Uber sets up taxi service in the Hamptons, lured by deep-pocketed partygoers

Like many New York City dwellers, Adam Cosentino's summer ritual includes making the 100-mile trek to the beach towns of the Hamptons every weekend.

He isn't going to play with the rich and famous who regularly dot the white-sand beaches, nightclubs and house parties in tony towns like East Hampton and Amagansett. Cosentino, 43, who works with mobile car-booking application Uber Technologies, is there to profit off the Hamptons hordes as their driver.

Cosentino and hundreds of other Uber drivers who head to Long Island's east end have helped define a new market for Uber called a "pop-up," in which drivers operate only during high-demand periods.

"I can make $1,000 in half the time it would take me in New York, where the summer weekends are dead," Cosentino said while driving his Chrysler 300 to Sag Harbor on a recent Saturday.

Uber previously created pop-up markets to promote its service at events that draw big audiences, such as the annual South by Southwest Interactive conference in Austin, Texas.

But the Hamptons market operates the entire summer, allowing Uber to continue serving the New York market — its biggest by revenue — even as residents move around. The average trip is nearly three times the distance of one in New York City, the company said. A trip in Uber's black-car service starts at $16,  in an Uber sport utility vehicle, it starts at $25. Uber pays the $150 cost of a Hamptons car permit, while drivers own their cars and pay for gas and insurance.

San Francisco-based Uber, which landed a $17 billion valuation in a June financing, added its lower-cost UberX service to the beach towns this year. In July, Uber offered helicopter service from New York City to East Hampton, costing $3,000 and seating for as many as five people for Independence Day.

The Hamptons provides one of the most concentrated pools of wealthy passengers during the summer. Bill Clinton and Hillary Clinton have spent time in an East Hampton rental, while Goldman Sachs chief executive Lloyd Blankfein bought a property listed for $32.5 million in 2012.

All of that is drawing drivers like Don Banks, who's worked for UberX for the past year in New York. He recently spent $65,000 on a new Chevy Suburban so he could ferry passengers in the Hamptons this summer.

"I bought an SUV to make more money," said Banks, who owns a three livery cars in Westchester County.

Miodrag Susa, who has been driving his limousine for Uber's black-car service for four months in New York, estimates he's reaping $1,500 to $2,000 a weekend in the Hamptons, compared with $700 over a similar period in the city.

"I love Uber because I can be my own boss," he said.

But many drivers said they can't find affordable places to stay in the Hamptons, so they typically commute each day of the weekend from the city to Long Island. Some drivers also said there are too many Uber vehicles there. As a result, demand for Uber luxury cars peaks only at night when the partying starts, said Mohamed Bhatti, who drives a Suburban for UberX in East Hampton.

"There's too much competition," he said.

But for passengers, wait times in the Hamptons is now a fraction of that for a regular taxi service, which on a Saturday night might have been as long as one hour, said John Foley, founder of Peloton Cycle, which has a store in East Hampton.

"Uber has done an amazing job in guaranteeing a high quality service with an average wait of four to five minutes," said Foley, who uses Uber so he can drink without worrying about driving back from gathering spots like the Crow's Nest or the Surf Lodge in Montauk, Long Island's increasingly popular eastern point.

Given the plethora of summer visitors, taxi drivers haven't united in protest against the app, as they have in markets from Europe to Seattle.

"As long as people can afford Uber, there's business for everybody," said Ted Kopoulos, who owns five cabs in East Hampton. "Uber isn't here during the week or in the winter; my business didn't slow down."

For some local cab companies out East, Uber’s arrival is not welcome. They say the huge numbers of Uber cars on summer weekends gives them an edge in providing service to customers in a hurry for a ride, even though, the local companies contend, Uber usually charges considerably higher rates than they do.

Larry Smygura, owner of Taxi One in East Hampton, which operates five cars during summer, said, “They have so many cars that their penetration in customers here is good and they are able to come to the customer very quickly. For customers, that is an advantage if they need something immediately during the party hours, but by doing this Uber is completely killing the local businesses and their employees.”

East End Taxi co-owner Carol Damart, whose company operates about 15 vehicles based in East Hampton during the summer, claims Uber drivers sometimes solicit passengers at bars and Hamptons Jitney stops, in violation of regulations requiring that customers call them for service. “That’s not how a car service is supposed to operate,” she said. She says, though, it’s not hurting her business much.

An Uber spokesman said, “Taxi companies claim a lot of things in attempt to restrict competition and consumer choice ... any solicitation independent from the app is strictly prohibited.”

Working in the Hamptons is a perk for Uber's top drivers. Only those with the highest ratings from riders -- at least a 4.7 out of 5 stars -- can operate in the area because "Uber wants to preserve its image keeping a high-standard of service," Cosentino said.

Cosentino, who started working for Uber in 2012 to pay for a business degree after being honorably discharged from the Army, said he can make up to $3,000 in a good week.

The Hamptons hit his radar screen this summer after Uber, which last year demoted his Chrysler 300 from the black-car service to its cheaper UberX service, opened the market to its lower-priced rides. Cosentino said he usually drives to Bridgehampton on Friday afternoons because that's the area he knows the best and cellular network reception is poor elsewhere.

A typical Hamptons work night involves spending the evening driving patrons to East Hampton's Pink Elephant or Southampton's 1 Oak, he said. While the clients tend to be younger than the typical professionals he has in Manhattan, they are similarly well mannered, he said.

Cosentino adds that he doesn't think there are too many Uber drivers competing for the youthful beachgoers.

"Demand is endless," he said.

Tom Incantalupo contributed to this story.