Taxis are either independent contractors driving their own or company cars and getting most or part of the fare, or employees paid by the hour who are pushed to get a particular revenue per hour. Yes, the contractors will now have to be employees in California, so that model is gone there.

The former tends to adapt okay to predictable demand, the latter tends to not at all.

Before Lyft and Uber, my usual wait time for a Taxis in the Seattle area was on the order of 45 minutes to an hour. Since the rideshare companies became common, the wait time for taxis has gone down, but its still longer than the wait for Lyft.

There's actually jurisprudence that taxi drivers can be employees, not independent contractors, even when they are working for fares and lease the vehicle. See Linton v. DeSoto Cab.