AUSTIN, Texas (Reuters) - On-demand ride companies Uber and Lyft suffered an embarrassing defeat in a Saturday election in Austin as voters backed a measure requiring fingerprint background checks for drivers. 
 
 Campaign signs concerning a municipal vote over fingerprint requirements for ride-hailing companies such as Uber and Lyft are seen along a roadway in Austin, Texas, May 6, 2016. REUTERS/Jon Herskovitz 
 
 The two companies spent more than $8 million to repeal a city ordinance requiring the fingerprint-based criminal checks and launched what turned into the most expensive race in the Texas capital’s history. Voters said by a margin of 56 to 44 percent they wanted the fingerprint checks to stay. 
 
 The companies outspent their opponents by 80-to-1 and when the votes were tallied their campaign contributions broke down to being more than $200 for each vote in favor of their position. 
 
 “Disappointment does not begin to describe how we feel about shutting down operations in Austin,” Uber’s Austin general manager Chris Nakutis said in a statement. 
 
 The stakes were high for the privately held Uber [UBER.UL] and Lyft, which say their background checks are already rigorous and ensure safety. 
 
 “Unfortunately, the rules passed by City Council don’t allow true ridesharing to operate,” Lyft said, adding it will suspend operations in Austin as of Monday. 
 
 The loss could prod other cities to require fingerprint criminal background checks, encouraged that they can survive a bruising electoral battle with the ride-hailing services, analysts said. 
 
 The costly municipal election in Austin came as other cities consider imposing fingerprint-based background checks on drivers. The Austin election marked the first time a major U.S. city put the regulations to a vote, which happened after a petition drive by Ridesharing Works for Austin, the political action group underwritten by Uber and Lyft. 
 
 Residents were asked to decide whether a transportation ordinance passed by the City Council in December should be repealed and replaced with one backed by the on-demand ride companies. 
 
 The city ordinance calls for all ride-hailing service drivers to have fingerprint-based criminal background checks, while the ride-hailing companies backed one that does not. 
 
 The group supporting mandated fingerprinting said the heavy spending was a signal that the Uber and Lyft campaign was motivated more by corporate profits than passenger safety. 
 
 Other places battling over fingerprints include Atlanta and Houston, which along with New York is one of the two major U.S. cities where Uber operates even though its drivers are required to undergo the fingerprint background checks. ||||| Mayor Steve Adler maintains that the ridesharing firms are "welcome to stay," and has offered to keep negotiating. However, it's doubtful that either of the companies will be so quick to come back. Both tend to play hardball when new laws make life difficult, often by threatening to end service -- they give up their main bargaining chip if they don't follow through on that threat. Sure enough, Lyft says this is taking a "stand for a long-term path forward," while Uber feels nothing but "disappointment." 
 
 No matter what, the outcome will be mixed. Opponents to Proposition 1 are happy that companies which do operate should have a stricter vetting process that reduces the chances of drivers committing crimes. It also pleases emergency crews worried that they'll have to dodge around mid-street pickups. However, the withdrawal is bound to be a hassle for both customers and drivers. Austin is a very car-focused city, and going without ridesharing means either paying much more for a cab or else using a mass transit system that's far from ideal. And of course, drivers who made significant cash through these services now have to scramble to find other work. Things aren't set in stone yet (this is just a proposition), but Austinites could still be in for a shock. ||||| US ride-hailing company to appeal against ruling but new chief executive admits it is the ‘cost of a bad reputation’ 
 
 Uber has been stripped of its London licence in a surprise move that dealt a serious blow to one of Silicon Valley’s fastest rising companies and sparked an outcry from a coalition of customers, government ministers and drivers at the ride-hailing company. 
 
 The firm’s application for a new licence in London was rejected by Transport for London on the basis that the company is not a “fit and proper” private car hire operator. 
 
 Uber’s cars will not disappear immediately as its current licence expires on 30 September and it plans to challenge the ruling by London’s transport authority in the courts immediately. The firm can continue to operate in the capital – where it has 3.5 million users – until it has exhausted the appeals process, which could take months.. 
 
 How will you be affected by Uber losing its licence to operate in London? Read more 
 
 Uber’s chief executive, Dara Khosrowshahi, wrote to staff on Friday confirming that the company would appeal against the ruling. He said he disagreed with the decision but it was based on past behaviour. 
 
 “The truth is that there is a high cost to a bad reputation,” he wrote. “It really matters what people think of us, especially in a global business like ours. 
 
 “It’s critical that we act with integrity in everything we do, and learn how to be a better partner to every city we operate in. That doesn’t mean abandoning our principles – we will vigorously appeal TfL’s decision – but rather building trust through our actions and our behaviour. In doing so, we will show that Uber is not just a really great product, but a really great company that is meaningfully contributing to society, beyond its business and its bottom line.” 
 
 Khosrowshahi, who was brought in to run the firm after a series of scandals, also tweeted an appeal to Londoners to “work with us” in solving the issue. 
 
 dara khosrowshahi (@dkhos) Dear London: we r far from perfect but we have 40k licensed drivers and 3.5mm Londoners depending on us. Pls work w/us to make things right 
 
 The decision by TfL was backed by the London mayor, Sadiq Khan, employment rights campaigners, and the trade body for the capital’s black-cab drivers, who have been staunch opponents of the US-based company. 
 
 However, it drew immediate criticism from Uber users, drivers and Greg Hands, the trade minister. 
 
 
 
 One of Uber’s 40,000 drivers in the capital, James Farrar, who has campaigned for better working conditions at the firm, said TfL’s decision was a “devastating blow”. 
 
 TfL said it had rejected the company’s application to renew its licence because “Uber’s approach and conduct demonstrate a lack of corporate responsibility” in relation to reporting serious criminal offences, obtaining medical certificates and driver background checks. 
 
 The licensing body also said it was concerned by Uber’s use of Greyball, software that can be used to block regulatory bodies from gaining full access to its app and undertaking regulatory or law enforcement duties. 
 
 The decision to remove Uber from one of its biggest markets is the latest blow for a company that has shot to a $70bn (£52bn) valuation since it was founded in 2009 but has been hobbled by opposition from national and municipal governments around the world – including in Italy and Rio de Janeiro – due to concerns over safety or the threat to existing taxi businesses. 
 
 
 
 Prof Andre Spicer, from Cass Business School in London, said the decision was a “potentially mortal blow” to Uber. “In the past Uber operated at the edge of the law with new technology as an alibi. Now its rogue business model is proving to be a big liability.” 
 
 Khan said he fully supported TfL’s decision, saying all companies needed to “play by the rules”. 
 
 
 
 He said: “I want London to be at the forefront of innovation and new technology and to be a natural home for exciting new companies that help Londoners by providing a better and more affordable service. 
 
 “However, all companies in London must play by the rules and adhere to the high standards we expect – particularly when it comes to the safety of customers.” 
 
 But Hands, who is also minister for London, said: “At the flick of a pen Sadiq Khan is threatening to put 40,000 people out of work and leave 3.5 million users of Uber stranded. 
 
 “Uber must address safety concerns and it is important there is a level playing field across the private hire market. 
 
 “But a blanket ban will cause massive inconvenience to millions of Londoners, all while showing that the Mayor of London is closed to business and innovation.” 
 
 Sam Gyimah, a Conservative justice minister and MP for East Surrey, said it was “possible to have effective regulation of Uber without 
 
 penalising the consumers who benefit from more choice and lower 
 
 prices”. 
 
 How will TfL's decision affect Uber? Read more 
 
 Steve McNamara, general secretary of the Licensed Taxi Drivers’ Association, which represents black-cab drivers, said the mayor had made the right decision. 
 
 “Since it first came on to our streets Uber has broken the law, exploited its drivers and refused to take responsibility for the safety of passengers. This immoral company has no place on London’s streets,” he said. 
 
 Uber said in a statement the decision would “show the world that, far from being open, London is closed to innovative companies”. 
 
 “3.5 million Londoners who use our app, and more than 40,000 licensed drivers who rely on Uber to make a living, will be astounded by this decision,” the company added. 
 
 The company wrote to users on Friday asking them to “defend the livelihoods” of its drivers and sign a petition asking the mayor to reverse TfL’s decision. 
 
 Uber (@Uber) Help ensure Londoners have more, not fewer, transportation options—sign the petition. https://t.co/nheuOcYjQH 
 
 Farrar, a co-claimant in a landmark employment tribunal decision against Uber and chair of the Independent Workers’ Union of Great Britain’s private hire drivers’ branch, said TfL should have stepped in earlier to protect drivers. 
 
 “To strip Uber of its licence after five years of laissez-faire regulation is a testament to a systemic failure at TfL,” he said. 
 
 The majority of Uber users responding to a Guardian request for comment opposed the decision to revoke the company’s licence. 
 
 Helen, from Walthamstow in east London, criticised the decision and said TfL should be working more closely with Uber. “With a lack of staff and police visible [on public transport], I often feel unsafe travelling alone and Uber has given me an affordable alternative to get home safely,” she said. 
 
 Leo, a wheelchair user, said less than 30% of the tube network was accessible to him and buses were slow. “Uber has been a lifesaver for me. It has got me to visit family at short notice when the nearest accessible station was miles away and the bus took two hours,” he said. 
 
 Uber is treating its drivers as sweated labour, says report Read more 
 
 In London, Uber has faced criticism from unions, lawmakers and traditional black-cab drivers over working conditions. Unions including the IWGB and GMB called on TfL to insist Uber guaranteed basic employment rights under the terms of its new five-year licence. 
 
 Employment rights campaigners said TfL’s decision was a warning shot to so-called gig economy companies, which include apps such as Deliveroo and delivery firms such as Hermes who argue their drivers and riders are self-employed. 
 
 Frank Field, the Labour MP who led a parliamentary inquiry which found that Uber drivers were treated as Victorian-style “sweated labour” said: “This is a gamechanger for the gig economy. Uber must now respond to TfL’s decision by totally resetting its business model.”
– Uber and Lyft have made good on their threat to terminate operations in Austin as of Monday morning after a referendum didn't go their way. The companies spent more than $8 million—more than 50 times what their opponents spent—in a failed attempt to overturn the Texas city's requirement for fingerprint-based background checks, reports Reuters. Despite blanketing the area with ads, the companies lost Saturday's vote on Proposition 1 by 56% to 44%, reports Engadget, which notes that the companies were also fighting to be able to pick up passengers in traffic lanes. Mayor Steve Adler says he wants Uber and Lyft to stay in Austin, but the companies say they are "disappointed" and they need to "take a stand." Uber says the withdrawal will leave around 10,000 people out of work. The Uber and Lyft spend on the campaign worked out to around $223 for every vote they received, making it the most expensive campaign in city history. The previous record, Adler's 2014 election campaign, cost only a seventh of what they spent on the Proposition 1 fight. Uber and Lyft "decided they were going to make Austin an example to the nation," political consultant David Butts, who led the opposition campaign, Our City, Our Safety, Our Choice, tells the Austin American-Statesman. "And Austin made Uber an example to the nation." After the Austin vote, other cities are now expected to target Uber on the fingerprinting issue. (The company's drivers are now allowed to encourage tipping.)