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Well, to be fair, it's because someone's handing out free money in the form of subsidized rides. The fact that hailing a taxi is more expensive (nevermind less

Well, to be fair, it's because someone's handing out free money in the form of subsidized rides. The fact that hailing a taxi is more expensive (nevermind less convenient) is a strong argument when the consumer is making a choice. Wrapped in that argument is the obvious idea that Uber is burning investor money to capture the market, but you can't expect consumers to protest by paying more. That's what's so insidious about market capture; everyone is behaving rationally in their own self interest, but the outcome can become monopolistic, with increasing returns to the monopolist. That's why it's traditionally been the role of the government to break up monopolies, because the market won't sort itself out. It's just that today's digital monopolies smell a little different, and the appetite for government intervention is lower than it used to be (perhaps because we don't remember catastrophic failings of the market quite as sharply as we used to -- 401ks being decimated is one thing, but bread lines and starvation are another). So yeah, I think Uber's potentially dangerous. But I use it. Definitely some mental frisson, but I've spent time trying to fathom it and this is the best mental gymnastics I can manage.

FabHK 10y ago
Agreed. As I like to say, Uber screws their drivers (already, but wait for autonomous cars...), Uber screws their competition (subsidised), and their investors, too. For now, they don't screw their customers, but let's see what happens when they've gotten to monopoly market share. I've also argued before that it is somewhat of a natural monopoly insofar as the biggest player will typically have more cars nearer you, and their app will offer the shortest waiting time. To combat that, one could regulate taxis like a public utility, and require that all providers submit their data to a register that collates the data and lists all cars and all riders centrally. Then one could have different companies and different apps compete on a level playing field. Some people disagree with that. I think it boils down to the definition of monopoly (barriers to entry? decreasing marginal cost? network effect? ...?), but at the end of the day definitions don't really matter -- what matters is a better outcome for consumers, and I fear regulation is required for that at some point.
- chx 10y ago
  > For now, they don't screw their customers Dismantling the rule of law in my book counts as screwing up the entire society.

FabHK 10y ago

Agreed. As I like to say, Uber screws their drivers (already, but wait for autonomous cars...), Uber screws their competition (subsidised), and their investors, too. For now, they don't screw their customers, but let's see what happens when they've gotten to monopoly market share. I've also argued before that it is somewhat of a natural monopoly insofar as the biggest player will typically have more cars nearer you, and their app will offer the shortest waiting time. To combat that, one could regulate taxis like a public utility, and require that all providers submit their data to a register that collates the data and lists all cars and all riders centrally. Then one could have different companies and different apps compete on a level playing field. Some people disagree with that. I think it boils down to the definition of monopoly (barriers to entry? decreasing marginal cost? network effect? ...?), but at the end of the day definitions don't really matter -- what matters is a better outcome for consumers, and I fear regulation is required for that at some point.

chx 10y ago
> For now, they don't screw their customers Dismantling the rule of law in my book counts as screwing up the entire society.