6 ms·

> Sell $1 bills for $0.90. That worked really well for Uber. It can work for you too! Huh? What's the story there?

by ZainRiz 10y ago

IgorPartola 10y ago
It's mostly sarcasm, but Uber is one example of several companies whose business model was to disrupt an entrenched industry by providing more value than they were charging for, capture market share, then raise prices. Basically, initially it was cheaper to take an Uber than a Taxi. Currently that's no longer the case.
- Finbarr 10y ago
  In the SF Bay Area it's still way cheaper to take Uber than a Taxi.
  - guyzero 10y ago
    In the one urban area that has the worst taxi service in the US, Uber is winning. Great!
    - MichaelBurge 10y ago
      I'm not sure I understand your point. Are you claiming that they're losing in every single other market? At least in Portland, I've never taken a taxi in my life, but have taken probably a dozen Ubers.
      - BeetleB 10y ago
        >At least in Portland, I've never taken a taxi in my life, but have taken probably a dozen Ubers. Which is one reason why Uber is winning. You do not even bother to check taxi fares. I checked Uber rates to get to the airport. Not cheaper than taxi - about the same.
        brownbat 10y ago
        > I checked Uber rates to get to the airport. Not cheaper than taxi - about the same. Did people stop tipping cabs? Maybe you meant Ubers were 20% more expensive, or maybe people don't tip cabs anymore, I don't know. Honestly I'd pay more than cabfare + tips just to have the price be explicit. Tips basically become a tax on nice people. I'd much rather everyone was paying the same price.
        Veen 10y ago
        I live in Hungary where the taxis are pretty cheap but you have to call them, and there's not guarantee that you'll get someone who can speak English. When I first got here, I used Uber all the time, but the government passed some anti-über laws and Uber withdrew from the market. Now I just use the public transport, which is pretty good, but less convenient than Uber. I felt bad for all the drivers that lost their jobs.
    - serge2k 10y ago
      Cheaper in Seattle too. They are still losing billions a year.
    - friendlygrammar 10y ago
      It's cheaper everywhere in the US
  - nodesocket 10y ago
    In many cities it is still cheaper to Uber than Taxi. Personally I know it is cheaper to Uber than taxi in San Francisco, Stockholm, Cluj (Romania), Prague, and Brussels.
- freshyill 10y ago
  While the lower price was nice, one of the biggest selling points for Uber with me was convenience and a guaranteed minimum level of quality. While Uber is as cheap and convenient as ever for me (in and around DC), the quality has seriously suffered. I've been in some pretty beat Uber cars, and one time the driver got out to pee behind the car.
deleted 10y ago
[deleted]
kuschku 10y ago
Predatory Pricing. Something Uber did, which is illegal, but they will likely never get fined for it.
- prodigal_erik 10y ago
  A taxi driver has to rent a medallion and a car (because they can't just use the one they already own) and needs to charge extra for trips across city limits (because they're barred from picking up anyone in another city). It's not predatory pricing when your lower prices are due to lower costs.
  - kuschku 10y ago
    A taxi driver in my state has to rent nothing, has to only get insurance and a drivers license allowing them to transport people (which is basically 50$), and there’s two dozen competing services. Don’t assume your local shitty laws are an issue everywhere.
    - Cpoll 10y ago
      Likewise, don't assume your local good laws aren't shitty everywhere else.
- grkvlt 10y ago
  Predatory pricing is only illegal if you are a monopoly, or part of a price-fixing cartel. Simply selling something for less than cost is 100% legal, although as a business strategy it requires deep pockets, and if or when you raise prices you risk alienating your customers...
  - grkvlt 10y ago
    Clarification, having checked after being down-voted. It is also illegal if the below-cost pricing strategy can be shown to have been implemented with the express purpose of driving competitors out of business. This intent is the important thing, it would be fine to sell below cost to gain customers for a new market, or to encourage network effects, and if that had the unintended side effect of causing a competing company to fail this is fine. My understanding is that these cases are usually very hard to prove, unless you have 'smoking gun' evidence of some kind.

> Sell $1 bills for $0.90. That worked really well for Uber. It can work for you too! Huh? What's the story there?

by ZainRiz 10y ago

> Sell $1 bills for $0.90. That worked really well for Uber. It can work for you too! Huh? What's the story there?

It's mostly sarcasm, but Uber is one example of several companies whose business model was to disrupt an entrenched industry by providing more value than they were charging for, capture market share, then raise prices. Basically, initially it was cheaper to take an Uber than a Taxi. Currently that's no longer the case.

Finbarr 10y ago
In the SF Bay Area it's still way cheaper to take Uber than a Taxi.
- guyzero 10y ago
  In the one urban area that has the worst taxi service in the US, Uber is winning. Great!
  - MichaelBurge 10y ago
    I'm not sure I understand your point. Are you claiming that they're losing in every single other market? At least in Portland, I've never taken a taxi in my life, but have taken probably a dozen Ubers.
    - BeetleB 10y ago
      >At least in Portland, I've never taken a taxi in my life, but have taken probably a dozen Ubers. Which is one reason why Uber is winning. You do not even bother to check taxi fares. I checked Uber rates to get to the airport. Not cheaper than taxi - about the same.
      - brownbat 10y ago
        > I checked Uber rates to get to the airport. Not cheaper than taxi - about the same. Did people stop tipping cabs? Maybe you meant Ubers were 20% more expensive, or maybe people don't tip cabs anymore, I don't know. Honestly I'd pay more than cabfare + tips just to have the price be explicit. Tips basically become a tax on nice people. I'd much rather everyone was paying the same price.
        Veen 10y ago
        I live in Hungary where the taxis are pretty cheap but you have to call them, and there's not guarantee that you'll get someone who can speak English. When I first got here, I used Uber all the time, but the government passed some anti-über laws and Uber withdrew from the market. Now I just use the public transport, which is pretty good, but less convenient than Uber. I felt bad for all the drivers that lost their jobs.
  - serge2k 10y ago
    Cheaper in Seattle too. They are still losing billions a year.
  - friendlygrammar 10y ago
    It's cheaper everywhere in the US
- nodesocket 10y ago
  In many cities it is still cheaper to Uber than Taxi. Personally I know it is cheaper to Uber than taxi in San Francisco, Stockholm, Cluj (Romania), Prague, and Brussels.
freshyill 10y ago
While the lower price was nice, one of the biggest selling points for Uber with me was convenience and a guaranteed minimum level of quality. While Uber is as cheap and convenient as ever for me (in and around DC), the quality has seriously suffered. I've been in some pretty beat Uber cars, and one time the driver got out to pee behind the car.

deleted 10y ago

[deleted]

kuschku 10y ago

Predatory Pricing. Something Uber did, which is illegal, but they will likely never get fined for it.

prodigal_erik 10y ago
A taxi driver has to rent a medallion and a car (because they can't just use the one they already own) and needs to charge extra for trips across city limits (because they're barred from picking up anyone in another city). It's not predatory pricing when your lower prices are due to lower costs.
- kuschku 10y ago
  A taxi driver in my state has to rent nothing, has to only get insurance and a drivers license allowing them to transport people (which is basically 50$), and there’s two dozen competing services. Don’t assume your local shitty laws are an issue everywhere.
  - Cpoll 10y ago
    Likewise, don't assume your local good laws aren't shitty everywhere else.
grkvlt 10y ago
Predatory pricing is only illegal if you are a monopoly, or part of a price-fixing cartel. Simply selling something for less than cost is 100% legal, although as a business strategy it requires deep pockets, and if or when you raise prices you risk alienating your customers...
- grkvlt 10y ago
  Clarification, having checked after being down-voted. It is also illegal if the below-cost pricing strategy can be shown to have been implemented with the express purpose of driving competitors out of business. This intent is the important thing, it would be fine to sell below cost to gain customers for a new market, or to encourage network effects, and if that had the unintended side effect of causing a competing company to fail this is fine. My understanding is that these cases are usually very hard to prove, unless you have 'smoking gun' evidence of some kind.