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Ride Service Users Need To Beware Of 'Surge' Pricing On New Year's Eve

DENVER (CBS4) - After the clock strikes midnight on New Year's Eve a lot of people will be looking to get a lift home, and it could cost more for those who choose to use a ride service.

In years past, taxis were the only game in town -- and they raked in the money. But then came the apps -- Uber and Lyft.

"I'd say they've take at least 50 percent of the business and 50 percent of the drivers," a cab driver told CBS4.

And unlike taxis, they can raise prices when demand is high.

"Uber was skyrocketed about 10 times the cost it probably should've been," said a man looking for a ride on a busy night downtown.

Uber calls it "surge" pricing. Lyft calls it "prime time."

"Prime time exists basically as an incentive to get people out on the road," said Lyft driver Mika Sanfilippo. "When people know there's going to be a higher percentage of prime time, they'll be like, 'All right, I might as well drive these few hours.' "

In many cities Lyft is raising the cap on prime time rates -- up to a possible four times the normal fare.

Uber will have no cap on surge pricing. Uber riders have to confirm on their phone the increased rate before a car will even pick them up.

The best thing to do is to shop around.

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