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All of these pieces carefully avoid talking about the fact that Uber claims to have been profitable in several US cities in 2016. In places where they have had

by wwalser 10y ago

All of these pieces carefully avoid talking about the fact that Uber claims to have been profitable in several US cities in 2016. In places where they have had time to figure our their model, pricing and supply/demand, they appear to be capable of becoming profitable. While most people can understand pricing and supply/demand being different between cities, Uber's model actually changes in some cities as well. In some parts of the world they don't charge using credit cards because no consumers use them, in other parts their drivers don't use cars because it's impractical. I'm all for calling out companies for exhibiting abhorrent behavior toward contractors and employees. That has value and can elicit change. Doom & gloom pieces on the other hand are a dime a dozen. This one specifically I find lacking. Uber isn't losing mountains of cash because it's unsustainable. It's losing mountains of cash because it can afford to and wants to in order to continue it's absolutely astonishing growth rate. They may be bad people. You may not want to work for them. I grant those premises. I got an offer and turned it down. That said, I simply can not understand the desire to see them fall. The delta between what existed before and what they've built is vast. I'd happily pay 2x my current rate and the claim that I would _have_ to pay 5x to cover their costs is laughable.

paulddraper 10y ago
Really? 2x? I think 1.5x would be pushing it, considering the competition.
- wwalser 10y ago
  My opinion (and I know this varies): * The service is superior to a cab 100% of the time. It's never worse. Ever. The margin of "better" is not small. * I use to use Uber regularly in three cities[1]. * In one, Orlando, prices from the airport are the same as a cab _but_ the only cars available from the airport are Lux, meaning they are on par with most black car services at a fraction of a black car price. * In another city, Sydney, Uber x is literally 50% of the price of a cab during "peak" hour (most nights). * In the third city, NY, Uber X is just slightly less than a cab but the delta in service level is immense. Yes, I would pay 2x. 1. I'm currently not using Uber. I think this article is doom & gloom with no value, however, I do think that Uber's leadership is transparently fully of ass hats who have no intention of cleaning up the company's culture. I'm sitting out because of the culture and leadership, not because I think they will eventually fail. I hope they fix their shit and succeed for all of the reasons I've outlined.
jlgaddis 10y ago
> All of these pieces carefully avoid talking about the fact that Uber claims to have been profitable in several US cities in 2016. This piece does talk about that: > The company reportedly said it wanted to achieve profitability in the second quarter of 2016, and it claimed at the time it had reached that goal [0] in the U.S. and Canada. In the very next sentence, however, we learn that: > But by December, according to Bloomberg [1], Uber was losing money again in the U.S., to the tune of $100 million per year. (links from original article) So maybe they were profitable -- in 2Q16 -- but apparently that didn't last very long. > I'd happily pay 2x my current rate ... In order for Uber to become profitable and/or continue to exist long term, you -- and all other Uber customers -- may have to. According to the article: > ... amid findings that rider fares only cover roughly 40 percent of a ride, with the remainder subsidized by venture capitalists ... [0]: https://www.bloomberg.com/news/articles/2016-04-14/lyft-is-gaining-on-uber-as-it-spends-big-for-growth https://www.bloomberg.com/news/articles/2016-04-14/lyft-is-g... [1]: https://skift.com/2016/12/21/uber-isnt-profitable-in-the-u-s-and-is-on-track-to-lose-3-billion-in-2016/ https://skift.com/2016/12/21/uber-isnt-profitable-in-the-u-s...
- wwalser 10y ago
  Thanks for pointing out the profitability bit that I missed. That was far enough into the article that I must have been skimming at that point. Cheers.
erdevs 10y ago
> All of these pieces carefully avoid talking about the fact that Uber claims to have been profitable in several US cities in 2016. In places where they have had time to figure our their model, pricing and supply/demand, they appear to be capable of becoming profitable. No, they don't. Mid-way through the article, Uber's profitability by geo is addressed. It's not broken down by city because apparently the data isn't available. But purportedly Uber had set goals to reach profitability in the US and Canada but backslid on US profitability at least. It's profitability by geo and operating line of business is also discussed with respect to their debt from investment banks.
- wwalser 10y ago
  Cheers, I missed that they did actually cover this. My mistake.
lsc 10y ago
>I'd happily pay 2x my current rate and the claim that I would _have_ to pay 5x to cover their costs is laughable. That's the thing, though; I think demand is super elastic. I used Uber almost every day when they ran their 50% off specials. It was glorious; whole weeks where I didn't drive at all. Now? sure, sometimes when I'm tired, I'll take an uber home (and back to work the next day) but most of the time, I drive myself, unless I'm drinking or going somewhere with challenging parking. At 2x current rates, I'd probably very rarely use the service to commute, though I'd still use it when there's even a chance of me getting a drink. even at 5x, I'd choose uber or lyft over a cab from five years ago, but I wouldn't use it much more than a cab from five years ago. but... this is all predicated on the current "no planning required" density of cars. right now, where I live, uber or lyft will be here within five minutes of my request, most of the time. If people took uber or lyft less often because it was more expensive, we'd have fewer cars in service, and my wait times would increase. That was the reason I didn't use cabs very often before the advent of uber; I didn't want to plan my rides in advance. The ride sharing services have a certain SLA they have to meet; if in service uber or lyft drivers fall below a certain density, demand will fall off a cliff. so that's the question; if they have to double their rates, will that drop demand (and thus supply of drivers) below that critical mass that allows them to be "transportation without planning"?
- pas 10y ago
  In some countries the difference between taxis and ride-sharing came down to the ability to order the service by an exact time. (So you can schedule a taxi, but you can't really ask for an uber to be at your house at 13:00.) But you can "publish your planned itinerary" and the smart ride sharing service can factor that in and maybe alert potential drivers (riders who might want to share?) close to you that were they to alter their schedule a bit like this, they'll have an increased chance of getting a ride-share. And similarly you might be willing to modify your very vague plans. (It might be enough if you can signal that you are likely going out with friends that night, and if enough people signal their intent, there will be enough ubers that night.)

by wwalser 10y ago

paulddraper 10y ago

Really? 2x? I think 1.5x would be pushing it, considering the competition.

wwalser 10y ago
My opinion (and I know this varies): * The service is superior to a cab 100% of the time. It's never worse. Ever. The margin of "better" is not small. * I use to use Uber regularly in three cities[1]. * In one, Orlando, prices from the airport are the same as a cab _but_ the only cars available from the airport are Lux, meaning they are on par with most black car services at a fraction of a black car price. * In another city, Sydney, Uber x is literally 50% of the price of a cab during "peak" hour (most nights). * In the third city, NY, Uber X is just slightly less than a cab but the delta in service level is immense. Yes, I would pay 2x. 1. I'm currently not using Uber. I think this article is doom & gloom with no value, however, I do think that Uber's leadership is transparently fully of ass hats who have no intention of cleaning up the company's culture. I'm sitting out because of the culture and leadership, not because I think they will eventually fail. I hope they fix their shit and succeed for all of the reasons I've outlined.

jlgaddis 10y ago

> All of these pieces carefully avoid talking about the fact that Uber claims to have been profitable in several US cities in 2016. This piece does talk about that: > The company reportedly said it wanted to achieve profitability in the second quarter of 2016, and it claimed at the time it had reached that goal [0] in the U.S. and Canada. In the very next sentence, however, we learn that: > But by December, according to Bloomberg [1], Uber was losing money again in the U.S., to the tune of $100 million per year. (links from original article) So maybe they were profitable -- in 2Q16 -- but apparently that didn't last very long. > I'd happily pay 2x my current rate ... In order for Uber to become profitable and/or continue to exist long term, you -- and all other Uber customers -- may have to. According to the article: > ... amid findings that rider fares only cover roughly 40 percent of a ride, with the remainder subsidized by venture capitalists ... [0]: https://www.bloomberg.com/news/articles/2016-04-14/lyft-is-gaining-on-uber-as-it-spends-big-for-growth https://www.bloomberg.com/news/articles/2016-04-14/lyft-is-g... [1]: https://skift.com/2016/12/21/uber-isnt-profitable-in-the-u-s-and-is-on-track-to-lose-3-billion-in-2016/ https://skift.com/2016/12/21/uber-isnt-profitable-in-the-u-s...

wwalser 10y ago
Thanks for pointing out the profitability bit that I missed. That was far enough into the article that I must have been skimming at that point. Cheers.

erdevs 10y ago

> All of these pieces carefully avoid talking about the fact that Uber claims to have been profitable in several US cities in 2016. In places where they have had time to figure our their model, pricing and supply/demand, they appear to be capable of becoming profitable. No, they don't. Mid-way through the article, Uber's profitability by geo is addressed. It's not broken down by city because apparently the data isn't available. But purportedly Uber had set goals to reach profitability in the US and Canada but backslid on US profitability at least. It's profitability by geo and operating line of business is also discussed with respect to their debt from investment banks.

wwalser 10y ago
Cheers, I missed that they did actually cover this. My mistake.

lsc 10y ago

>I'd happily pay 2x my current rate and the claim that I would _have_ to pay 5x to cover their costs is laughable. That's the thing, though; I think demand is super elastic. I used Uber almost every day when they ran their 50% off specials. It was glorious; whole weeks where I didn't drive at all. Now? sure, sometimes when I'm tired, I'll take an uber home (and back to work the next day) but most of the time, I drive myself, unless I'm drinking or going somewhere with challenging parking. At 2x current rates, I'd probably very rarely use the service to commute, though I'd still use it when there's even a chance of me getting a drink. even at 5x, I'd choose uber or lyft over a cab from five years ago, but I wouldn't use it much more than a cab from five years ago. but... this is all predicated on the current "no planning required" density of cars. right now, where I live, uber or lyft will be here within five minutes of my request, most of the time. If people took uber or lyft less often because it was more expensive, we'd have fewer cars in service, and my wait times would increase. That was the reason I didn't use cabs very often before the advent of uber; I didn't want to plan my rides in advance. The ride sharing services have a certain SLA they have to meet; if in service uber or lyft drivers fall below a certain density, demand will fall off a cliff. so that's the question; if they have to double their rates, will that drop demand (and thus supply of drivers) below that critical mass that allows them to be "transportation without planning"?

pas 10y ago
In some countries the difference between taxis and ride-sharing came down to the ability to order the service by an exact time. (So you can schedule a taxi, but you can't really ask for an uber to be at your house at 13:00.) But you can "publish your planned itinerary" and the smart ride sharing service can factor that in and maybe alert potential drivers (riders who might want to share?) close to you that were they to alter their schedule a bit like this, they'll have an increased chance of getting a ride-share. And similarly you might be willing to modify your very vague plans. (It might be enough if you can signal that you are likely going out with friends that night, and if enough people signal their intent, there will be enough ubers that night.)