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This is the rub. What really surprises me is that people simultaneously claim Uber cannot possibly be profitable while lambasting it for taking too much of a c

This is the rub. What really surprises me is that people simultaneously claim Uber cannot possibly be profitable while lambasting it for taking too much of a cut. Which one is it? Either they're being greedy with excessive margins or dangerously dependent on venture capital to sustain an unprofitable business model.

jdmichal 10y ago
First, false dichotomy. There is the possibility that they are taking too large a cut, and not charging enough to be profitable. But I don't think that's what the issue is. I think that there's two perspectives here. One, Uber is a match-making service, and charging 20% to make an automated match on a server... That could seem excessive. However, once you tack on things like boarding, marketing, development, legal fees, etc., it's possible that 20% isn't enough.
- morgante 10y ago
  > There is the possibility that they are taking too large a cut, and not charging enough to be profitable. How? How can their margin be too high and simultaneously not enough to be profitable? The only other alternative is that you think consumers should pay higher prices. You present two perspectives, but only one can be correct: either it takes 20% to support the service, or it doesn't.
  - meira 10y ago
    Well, if customers paid 20% more, both Uber and drivers woould get more. And they would lose appeal compared to táxi, só Uber prefers to earn less and forces drivers to do the same in the fate of market share lol.
    - morgante 10y ago
      If Uber charged more than taxis, demand would drop substantially and Uber drivers would be out of a job. Nobody is forcing them to work for Uber.
      - jdmichal 10y ago
        Ah, the good old "no one forced him" gig. Yes, no one literally went up to an Uber driver and told them to become one. Same way that no one literally goes up to a homeless immigrant and tells them to steal food [0]. But it's folly to pretend that the "invisible hand" of economics doesn't have a strong part to play in such decisions. [0] http://www.nytimes.com/2016/05/04/world/europe/food-theft-in-italy-may-not-be-a-crime-court-rules.html http://www.nytimes.com/2016/05/04/world/europe/food-theft-in...
  - jdmichal 10y ago
    > The only other alternative is that you think consumers should pay higher prices. I don't think anything in this particular matter. I don't use Uber and I don't work for Uber, so I don't really have a dog in this race. However, I don't see how Uber not charging enough isn't a valid viewpoint.

jdmichal 10y ago

First, false dichotomy. There is the possibility that they are taking too large a cut, and not charging enough to be profitable. But I don't think that's what the issue is. I think that there's two perspectives here. One, Uber is a match-making service, and charging 20% to make an automated match on a server... That could seem excessive. However, once you tack on things like boarding, marketing, development, legal fees, etc., it's possible that 20% isn't enough.

morgante 10y ago
> There is the possibility that they are taking too large a cut, and not charging enough to be profitable. How? How can their margin be too high and simultaneously not enough to be profitable? The only other alternative is that you think consumers should pay higher prices. You present two perspectives, but only one can be correct: either it takes 20% to support the service, or it doesn't.
- meira 10y ago
  Well, if customers paid 20% more, both Uber and drivers woould get more. And they would lose appeal compared to táxi, só Uber prefers to earn less and forces drivers to do the same in the fate of market share lol.
  - morgante 10y ago
    If Uber charged more than taxis, demand would drop substantially and Uber drivers would be out of a job. Nobody is forcing them to work for Uber.
    - jdmichal 10y ago
      Ah, the good old "no one forced him" gig. Yes, no one literally went up to an Uber driver and told them to become one. Same way that no one literally goes up to a homeless immigrant and tells them to steal food [0]. But it's folly to pretend that the "invisible hand" of economics doesn't have a strong part to play in such decisions. [0] http://www.nytimes.com/2016/05/04/world/europe/food-theft-in-italy-may-not-be-a-crime-court-rules.html http://www.nytimes.com/2016/05/04/world/europe/food-theft-in...
- jdmichal 10y ago
  > The only other alternative is that you think consumers should pay higher prices. I don't think anything in this particular matter. I don't use Uber and I don't work for Uber, so I don't really have a dog in this race. However, I don't see how Uber not charging enough isn't a valid viewpoint.