Why in-street parking app Haystack failed

Finding a parking spot in a big city is like finding a needle in a haystack. That is probably how parking app Haystack got its name. The Haystack app allowed those with a highly desired on-street parking spot to sell it to someone looking for a place to park. The price of each spot depended on the city. In Baltimore, the cost of each spot was $3, and in Boston it was $5. We use the past tense because the app shut down in November after getting banned in several cities.

Haystack and other similar apps have been banned in Boston, Los Angeles, San Francisco and Santa Monica, California. These cities feel that profits are being made off of city property that doesn't belong to the person who is selling the parking spot. Before voting to ban such apps like Haystack, Boston city council member Frank Baker summed up his opposition to the service by saying "My understanding was that they (the parking spot sellers) were trying to buy and sell public property that wasn’t theirs to buy and sell." Also worrisome for lawmakers was the "Make-Me-Move" feature on the app that basically auctioned off parking spots for the highest bid.

But did these cities shoot themselves in the foot? After all, they banned a service that helped ease congestion on busy city streets. Donald Shoup, professor of urban planning at UCLA, says that 30% of traffic congestion is due to people searching for on-street parking. But the cities worried that the system could easily be abused. People could tie up in-street parking spots with cars and and profit from selling each spot.

Part of the problem is that Haystack, like Uber, went into business hoping to gain traction before the city could take regulatory action against them. The goal is to solve a problem for consumers first, and get on your knees in front of regulators afterward. While it worked for Uber in a few places, Haystack had the problem of selling something that local lawmakers felt belonged to the city, not consumers.

Haystack founder Eric Meyers even met with the Mayor's office in Boston, offering to change the Haystack model and share revenue and data with the city, but was turned down. As we said, the Haystack app is no longer available having been removed from the Apple App Store and the Google Play Store. The idea is still a good one, and hopefully there are some forward thinking cities that will allow Haystack to relaunch, even if the old model has to be re-worked a little.


source: Haystack via WSJ