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We did see the same doubters in the early days of Amazon. And we see how that turned out. Personally, I'm not confident of either success or failure with Uber.

We did see the same doubters in the early days of Amazon. And we see how that turned out. Personally, I'm not confident of either success or failure with Uber. They (and their investors) are making a big gamble. In their favor is that it is a very capital-intensive gamble, and I don't see any other companies stepping forward to make that investment. A large car company could do so, but they've not made the transition to thinking in terms of the future "autonomous mobility services" paradigm.

epistasis 10y ago
I think the doubts about Amazon were different though. The doubt was whether they would succeed at their goal, rather than whether the goal would actually constitute financial success. Wal-mart for the digital era is clearly a successful position, and Amazon didn't subsidize their product to the degree that Uber has had to.
- intrasight 10y ago
  I respectfully disagree. Amazon MASSIVELY subsidized their service. It was commonly stated, and I believe true, that shareholders were paying for that critical 2-day free shipping.
  - epistasis 10y ago
    In, say, 2006, $884M was spent on shipping and $567M in shipping revenue[1], so there was a subsidy of $317M. This was in total revenue of $10.71B[2]. That's a 3% subsidy, and is within a profit margin. Uber is a bit harder to pin down from a quick google [3]. I'm seeing $750M loss in the recent quarter, which are "largely" attributed to driver subsidies by third parties, but Uber isn't talking. Let's say $500 as a rough estimate, which is 10% of the $5B in bookings that quarter. So I guess Uber's subsidies aren't as high as I thought, but are still significantly higher than Amazon's. They both operate in cut throat industries with slim margins. Whereas Amazon invested in warehouses and their infrastructure. Uber may have something up their sleeve, and I hope they do, but it's not clear for an outside observer how they are anywhere as likely as Amazon was to have profits to justify their valuation. [1] https://www.statista.com/statistics/236503/amazons-annual-shipping-revenue-and-outbound-shipping-costs/ https://www.statista.com/statistics/236503/amazons-annual-sh... [2] http://www.wikinvest.com/stock/Amazon.com_(AMZN)/Data/Revenue/2006/Q1 http://www.wikinvest.com/stock/Amazon.com_(AMZN)/Data/Revenu... [3] https://www.bloomberg.com/news/articles/2016-08-25/uber-loses-at-least-1-2-billion-in-first-half-of-2016 https://www.bloomberg.com/news/articles/2016-08-25/uber-lose...

epistasis 10y ago

I think the doubts about Amazon were different though. The doubt was whether they would succeed at their goal, rather than whether the goal would actually constitute financial success. Wal-mart for the digital era is clearly a successful position, and Amazon didn't subsidize their product to the degree that Uber has had to.

intrasight 10y ago
I respectfully disagree. Amazon MASSIVELY subsidized their service. It was commonly stated, and I believe true, that shareholders were paying for that critical 2-day free shipping.
- epistasis 10y ago
  In, say, 2006, $884M was spent on shipping and $567M in shipping revenue[1], so there was a subsidy of $317M. This was in total revenue of $10.71B[2]. That's a 3% subsidy, and is within a profit margin. Uber is a bit harder to pin down from a quick google [3]. I'm seeing $750M loss in the recent quarter, which are "largely" attributed to driver subsidies by third parties, but Uber isn't talking. Let's say $500 as a rough estimate, which is 10% of the $5B in bookings that quarter. So I guess Uber's subsidies aren't as high as I thought, but are still significantly higher than Amazon's. They both operate in cut throat industries with slim margins. Whereas Amazon invested in warehouses and their infrastructure. Uber may have something up their sleeve, and I hope they do, but it's not clear for an outside observer how they are anywhere as likely as Amazon was to have profits to justify their valuation. [1] https://www.statista.com/statistics/236503/amazons-annual-shipping-revenue-and-outbound-shipping-costs/ https://www.statista.com/statistics/236503/amazons-annual-sh... [2] http://www.wikinvest.com/stock/Amazon.com_(AMZN)/Data/Revenue/2006/Q1 http://www.wikinvest.com/stock/Amazon.com_(AMZN)/Data/Revenu... [3] https://www.bloomberg.com/news/articles/2016-08-25/uber-loses-at-least-1-2-billion-in-first-half-of-2016 https://www.bloomberg.com/news/articles/2016-08-25/uber-lose...