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I believe they are profitable in many city venues, their cash outlays have to do with targeting new markets, and moon-shot style projects. If they want to be p

I believe they are profitable in many city venues, their cash outlays have to do with targeting new markets, and moon-shot style projects. If they want to be profitable, they can pull back on aggressive expansion, and dump the more expensive, less fruitful projects.

easytiger 10y ago
Didn't make much sense to me they would put money into self driving cars. It works be much more sensible to await a viable commercial solution and then buy it in bulk.
- jacques_chester 10y ago
  Presumably they want to at least hold a portfolio of strategic patents.
  - jschwartzi 10y ago
    Why? If you can buy driverless cars from, say, GM, what do the strategic patents get you? If GM, Toyota, Ford, et al all sell them, there's pressure to reduce prices anyway. Lyft's core competence is in hooking people up with drivers, not in building advanced new automation tech. The smart thing to do is double down on it since there's a market and presumably a path to profitability.
    - jacques_chester 10y ago
      > Why? If you can buy driverless cars from, say, GM, what do the strategic patents get you? Royalties, most likely. Discounts on cars in exchange for licenses. Maybe something to auction off during the bankruptcy process so that investors get a fraction of their money back. Patents can be the most valuable thing a company has. Google pretty much wound up scooping the patents out of Motorola and selling the rest (you know, the thousands of smart people and hardware and history) for a discount.
    - danblick 10y ago
      Are you assuming these automakers won't compete with Uber directly? I think some automakers are looking to enter the "transportation services" market. http://www.wsj.com/articles/ford-says-it-will-focus-more-on-transportation-services-sector-1452016172 http://www.wsj.com/articles/ford-says-it-will-focus-more-on-...
- rhizome 10y ago
  My assumption is that it was merely to juice their valuation.
- edblarney 10y ago
  No, it makes a lot more sense for Uber to be involved in self driving than maybe anyone else. Self-driving is a 'near rality' meaning, the tech has progressed to the point wherein we can feasibly see it working at some point. I think it'll take a little longer, but it's basically going to happen. It represents an existential issue to Uber, it's a huge competitive issues, as well as a massive opportunity. Uber would be more readily able to lever the tech, than say Google, who has no fleet, and no ability to build cars. If GM/Ford get the tech going first, then they'll hold that over Uber in a very heavy hand. Also GM/Ford are slow, big companies and may lag the whole way. Tesla, Google, Uber are the 'big players' who could do it fast and well, smaller innovative shops notwithstanding. Though self driving might be a little expensive, it's definitely not a moonshot, more of a somewhat risky but highly relevant venture. If Uber could 'get all the pieces right' - and have driverless cars everywhere before GM/Ford got to market in a material way - Uber would be a multi-trillon dollar company. I mean - not only would it wipe out all their competition, increase market a lot just on the basis of price alone ... but it would fundamentally change how people buy/drive/own and use cars. As risky as it is - the idea of 'driverless ubers' is just too big to ignore. It's worth 100x the market for iPhones. Something to remember guys - look at the exports for most countries: #1 is cars. Look at family expenditures. After mortgage/rent - it's cars. Silicon Valley is used to 0.001 cent CPE's or 25 cent click-throughs. That's peanuts compared to transport. Disrupting cars is 100x bigger than anything the Valley has done before. The numbers are mind blowing. Now add in trucking/transportation ... it's basically mind-boggling. So as long as they can afford to pushing the driverless car front and as long as it's not costing them billions and billions a year in R&D, they should be definitely pushing it as their #1 long term strategic priority.
  - inimino 10y ago
    I guess this is the thinking driving Uber's current valuation. It's a pipe dream. Yes, self-driving is a near reality, and when it becomes feasible, a few quarters later it will be a commodity. It's just software, lots of people working on it, nobody has any secret sauce here. When that happens, what does Uber have? That's right, nothing. Their cars, which aren't equipped for self-driving. And their drivers, who are all going to be out of work. And their customers, who use Uber because it is artificially cheap and have no brand loyalty (widely hated company). Sure, disrupting transportation is big, but no advantage in sight for Uber there. They only thing they disrupted was traditional taxis on a wave of dumb investor money.
iambateman 10y ago
They really can't. Centralized taxi service is a winner-take-all market for at least individual countries. If uber lays off and decides to get profitable, they risk lyft taking hold because they're the only option in X markets. On the other hand, up until a few weeks ago it seemed like Uber had enough cash to outlast every competitor, achieve functional monopoly and from there they can charge whatever they want.
- deleted 10y ago
  [deleted]

easytiger 10y ago

Didn't make much sense to me they would put money into self driving cars. It works be much more sensible to await a viable commercial solution and then buy it in bulk.

jacques_chester 10y ago
Presumably they want to at least hold a portfolio of strategic patents.
- jschwartzi 10y ago
  Why? If you can buy driverless cars from, say, GM, what do the strategic patents get you? If GM, Toyota, Ford, et al all sell them, there's pressure to reduce prices anyway. Lyft's core competence is in hooking people up with drivers, not in building advanced new automation tech. The smart thing to do is double down on it since there's a market and presumably a path to profitability.
  - jacques_chester 10y ago
    > Why? If you can buy driverless cars from, say, GM, what do the strategic patents get you? Royalties, most likely. Discounts on cars in exchange for licenses. Maybe something to auction off during the bankruptcy process so that investors get a fraction of their money back. Patents can be the most valuable thing a company has. Google pretty much wound up scooping the patents out of Motorola and selling the rest (you know, the thousands of smart people and hardware and history) for a discount.
  - danblick 10y ago
    Are you assuming these automakers won't compete with Uber directly? I think some automakers are looking to enter the "transportation services" market. http://www.wsj.com/articles/ford-says-it-will-focus-more-on-transportation-services-sector-1452016172 http://www.wsj.com/articles/ford-says-it-will-focus-more-on-...
rhizome 10y ago
My assumption is that it was merely to juice their valuation.
edblarney 10y ago
No, it makes a lot more sense for Uber to be involved in self driving than maybe anyone else. Self-driving is a 'near rality' meaning, the tech has progressed to the point wherein we can feasibly see it working at some point. I think it'll take a little longer, but it's basically going to happen. It represents an existential issue to Uber, it's a huge competitive issues, as well as a massive opportunity. Uber would be more readily able to lever the tech, than say Google, who has no fleet, and no ability to build cars. If GM/Ford get the tech going first, then they'll hold that over Uber in a very heavy hand. Also GM/Ford are slow, big companies and may lag the whole way. Tesla, Google, Uber are the 'big players' who could do it fast and well, smaller innovative shops notwithstanding. Though self driving might be a little expensive, it's definitely not a moonshot, more of a somewhat risky but highly relevant venture. If Uber could 'get all the pieces right' - and have driverless cars everywhere before GM/Ford got to market in a material way - Uber would be a multi-trillon dollar company. I mean - not only would it wipe out all their competition, increase market a lot just on the basis of price alone ... but it would fundamentally change how people buy/drive/own and use cars. As risky as it is - the idea of 'driverless ubers' is just too big to ignore. It's worth 100x the market for iPhones. Something to remember guys - look at the exports for most countries: #1 is cars. Look at family expenditures. After mortgage/rent - it's cars. Silicon Valley is used to 0.001 cent CPE's or 25 cent click-throughs. That's peanuts compared to transport. Disrupting cars is 100x bigger than anything the Valley has done before. The numbers are mind blowing. Now add in trucking/transportation ... it's basically mind-boggling. So as long as they can afford to pushing the driverless car front and as long as it's not costing them billions and billions a year in R&D, they should be definitely pushing it as their #1 long term strategic priority.
- inimino 10y ago
  I guess this is the thinking driving Uber's current valuation. It's a pipe dream. Yes, self-driving is a near reality, and when it becomes feasible, a few quarters later it will be a commodity. It's just software, lots of people working on it, nobody has any secret sauce here. When that happens, what does Uber have? That's right, nothing. Their cars, which aren't equipped for self-driving. And their drivers, who are all going to be out of work. And their customers, who use Uber because it is artificially cheap and have no brand loyalty (widely hated company). Sure, disrupting transportation is big, but no advantage in sight for Uber there. They only thing they disrupted was traditional taxis on a wave of dumb investor money.

iambateman 10y ago

They really can't. Centralized taxi service is a winner-take-all market for at least individual countries. If uber lays off and decides to get profitable, they risk lyft taking hold because they're the only option in X markets. On the other hand, up until a few weeks ago it seemed like Uber had enough cash to outlast every competitor, achieve functional monopoly and from there they can charge whatever they want.

deleted 10y ago
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