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Uber is no more than an app with little network effect. If they start making money in a given city, a competitor can sweep in and take the city from them. I kn
by konschubert 10y ago
Uber is no more than an app with little network effect.
If they start making money in a given city, a competitor can sweep in and take the city from them.
I know they are planning a monopoly on self-driving taxis. But as of today, the valuation seems to be 3 orders of magnitude off.
- acchow 10y ago> Uber is no more than an app with little network effect. > If they start making money in a given city, a competitor can sweep in and take the city from them. Odd. I see their network effect as rather strong. Why would a driver use a new competitor app if the customers aren't there? Why would a customer download another app they haven't used before or heard of, especially if the rides aren't there?
- michaelbuddy 10y agoCompetitors always have it easier because they can see what works and doesn't work from original competition. Which means they can spend less and make more. Which means they can charge less and / or pay their drivers more.
- melvinmt 10y agoMore competition will pretty much always cause every competitor to spend more and make less... See: https://en.wikipedia.org/wiki/Perfect_competition#/media/File:Perfect_competition_in_the_short_run_(simple).svg https://en.wikipedia.org/wiki/Perfect_competition#/media/Fil...
- konschubert 10y ago> Why would a driver use a new competitor app if the customers aren't there? Because there is almost zero cost for the driver to sign up for yet another app. Already today, many drivers use multiple apps. > Why would a customer download another app they haven't used before or heard of, especially if the rides aren't there? He will hear about it and download it if the rides are cheaper.
- onewaystreet 10y ago> If they start making money in a given city, a competitor can sweep in and take the city from them. Uber uses their network effect to cut prices and force the competitor out. They have done this in a number of cities. No city has ever been "taken" from Uber (in the US at least).
- humidnyc 10y agoJuno has a good chance in NYC edit: and Lyft in SF
- konschubert 10y agoUber mainly uses their deep pockets to cut prices.
- aianus 10y agoThere are enormous network effects for their carpooling options such as UberPOOL, UberHOP, etc.
- konschubert 10y agoBut is this their main business?
- aianus 10y agoI don't use the other options if POOL is available and most of my friends are the same way.