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I'll be really interested in seeing what happens if Uber can't recover from the burn rate and make a sustainable business without self driving. I can see in th

I'll be really interested in seeing what happens if Uber can't recover from the burn rate and make a sustainable business without self driving. I can see in the best possible scenario we end up with more cities like Austin, Texas that have their own nonprofit ride sharing app. I actually have huge respect for what Austin did in banning Uber and Lyft and making their own app (Ride Austin) that isn't designed to make investors and owners rich, instead just benefit drivers and riders.

repomies69 10y ago
Wow, I didn't know about these. How well do those work? Do payments work automatically? What about reputation system?
- NathanKP 10y ago
  They work fantastically. Ride Austin is actually way better than Uber in my opinion. In fact even if Uber and Lyft decided to start following the city regulations and return to Austin I would probably never use either in Austin again, simply because I prefer the non profit approach that respects drivers and gives them a much higher percentage.
  - jimmywanger 10y ago
    > because I prefer the non profit approach that respects drivers and gives them a much higher percentage For now. I generally prefer for-profit approaches because their motivations are far more transparent. They want to make money for the investors. Non-profits exist to serve the wishes of the donors, which may be opaque. For instance, the Ride Austin investors might suddenly decide that they really want to focus on transportation to/from low income areas or art festivals. That would degrade service, and there would be no accountability to the customer in that regard.
    - cityhall 10y ago
      What you want is competition, not for one entity to control the market regardless of its organization.
      - mulmen 10y ago
        Well in this case sure, competition is good and apparently Austin has multiple choices so everything is fine but competition is not always the answer. Competition does not seem to be the answer to public transit for example. It's not such a leap to say that ride sharing type apps might end up being replaced by a more personal and dynamic form of bus service.
    - NathanKP 10y ago
      Yeah I can understand that. Honestly, the non profit / coop thing is just a big part of Austin culture. Not only are food coops a pretty big deal in Austin, but when I lived in Austin even the electricity company that I got my power from was a coop (https://www.pec.coop/ https://www.pec.coop/) and if the coop made too much money it redistributed the profits back out as credits to member accounts. I generally ended up with one out of twelve months effectively being free because of profit credits being redistributed back out to my account. The whole culture of coops and nonprofit service organizations is something I really miss about Austin now that I no longer live there.
      - ambicapter 10y ago
        > if the coop made too much money it redistributed the profits back out as credits to member accounts. This is great and all, but wouldn't that money be more effectively utilized maintaining or upgrading the grid or investing in renewable energy? Seems like the co-op model never really invests in progress.
        Doctor_Fegg 10y ago
        "never"? The (UK) Co-operative Bank was 99% powered by renewables in 2014.
        NathanKP 10y ago
        I don't think coops are necessarily anti maintenance or investment. Obviously they have to maintain their core business just like any other business. The difference is a for profit company distributes extra profit that they have on top of their basic needs out as dividends to big investors and as salary for a CEO. On the other hand a coop distributes that same money out to all the customers.
      - jimmywanger 10y ago
        With for-profit enterprises, there's generally an objective measure of how well you're doing, the bottom line. Non profits, you can get a lot of people arguing about how to best fulfill the intents of the non-profit. In that situation, whoever argues the most persuasively or loudly wins, and it's the customers that suffer.
    - Spooky23 10y ago
      Your description of a non-profit pretty well lines up with Uber.
  - wh-uws 10y ago
    Ride Austin is far from "way better" on par when the service works maybe but hardly better. This past Saturday none of the ride sharing services could handle demand and all went down. No riders could request and an no drivers could accept. Also when the service does work glitches like seeing the login screen when you are already logged in are routine. Source: I'm in Austin right now for sxsw and I'm a former Austin resident. Also this whole debacle was a clear and present tax grab for the city please dont pretend it wasn't. Now on balance Uber and Lyft ran an AWFUL campaign against the regulations when they already do background checks but still that was always about money.
    - ghaff 10y ago
      In all fairness, SXSW is a pretty severe stress test. FWIW, it can be hard to get personal transportation in a heavy rainstorm in NYC too.
    - wavefunction 10y ago
      I disagree with your "tax grab" angle since there is no evidence of that. Unless you mean that the city of Austin was somehow going to make money off fingerprinting?
      - thomasrognon 10y ago
        "(A) Each TNC operating in the City of Austin shall pay an annual fee calculated by the department based on one of the following methods of that TNCs choosing: (1) The total of the permit fee paid by taxicab companies times the number of persons driving for the TNC; (2) One (1) percent of the TNCs annual local gross revenues, or a comparable percentage of a TNCs portion of driver fares; or (3) Based on total miles driven. (B) Except for any TNC participating in the Safety Assurance Program, each TNC shall pay an additional fee of one (1) percent of the TNCs annual local gross revenue for the Compliant Driver Education Fund to be used to assist and incent drivers to become compliant." Also, it was about much more than just fingerprinting. Fingerprinting was emphasized because it would have affected Uber and Lyft's business model the most by reducing the supply of drivers due to higher onboarding friction. Here's the ordinance: https://www.austintexas.gov/edims/document.cfm%3Fid=245769 https://www.austintexas.gov/edims/document.cfm%3Fid=245769 Some more interesting parts: - "A TNC shall establish a driver-training program designed to ensure that each driver safely operates his or her vehicle prior to the driver being able to offer service" - "during periods of abnormal market disruptions, dynamic pricing shall be prohibited." - ...and the whole reporting section where they have to hand over all their internal operating data to the city
  - Eridrus 10y ago
    I don't know how much Uber cost in Austin, but it seems like the base costs for calling a car are $4.50; I've gotten Uber rides for less than that in NYC, and the cost has been the prime reason to call them (I probably would have taken a bus otherwise). I am very interested to see if aggressive pricing and cost/route optimisation can unlock enough demand to make pooling actually viable economically, which none of the Uber/Lyft alternatives really seem willing to try.
  - tbv 10y ago
    I believe you when you say you've had a good experience with Ride Austin, but I think you've been lucky. I've never been able to successfully book a ride with either Ride Austin or Fasten :\
- seanca 10y ago
  Very well. Now closing in on a year without Uber or Lyft, Fasten, Fare, and RideAustin have really come into their own as reliable options, especially on weekends that don't have extremely high demand numbers (ACL, SXSW, NYE weekends the apps have been less reliable).
deleted 10y ago
[deleted]
bbatsell 10y ago
Clearing up some serious misconceptions here: 1) Austin did not ban Uber or Lyft. The city council passed an ordinance that required a gradually increasing percentage of rideshare drivers pass an FBI-approved fingerprint background check. (These rules are in place in other locales in which Uber operates, such as NYC and Houston.) Uber and Lyft formed a PAC that got a proposition on the next local election ballot that would have overturned the ordinance, then spent $9 million on a massive advertising campaign supporting the proposition. The proposition failed overwhelmingly. 2) Uber and Lyft stopped providing services of their own volition within 48 hours. Considering they abide by the same regulations in other cities, it seems pretty obvious to me that it was done in retaliation in order to show other cities considering doing the same that they will actually pull out. 3) Several upstart ridesharing companies immediately jumped into the market and were fully operational in less than a month and are complying fully with the regulations. (Examples are Fasten, Fare, RideAustin, and GetMe.) 4) RideAustin is registered as a non-profit organization, formed by several local tech entrepreneurs affiliated with Capital Factory, an Austin accelerator/VC firm. It is not owned or operated by the city in any fashion.
- NathanKP 10y ago
  Yep I wasn't clear. Austin banned some of the wild west behavior of Uber and Lyft, and they refused to follow along with reasonable restrictions and decided to protest by leaving Austin.
- r00fus 10y ago
  #3 if anything should be proof to Uber's potential future investors that they need to be wary that Uber has anything but name recognition and first mover advantage. They have no moat, no barrier to entry, and a whole lot of hubris just waiting to mature in the form of fierce competitors and negative PR.
  - pm90 10y ago
    To be fair, the new apps do suffer with reliability issues in periods of high loads. e.g. I would not, from experience, trust fasten to get me back home at 2.30am on a weekend night (even if I'm willing to pay their "boosted" fares). Its not an unsolvable problem though. I bet if they could hire more/better engineers and invest in infra for reliability they could be a lot better. And it might actually happen if Uber suddenly raises its prices and people look around for alternatives. I think Uber and Lyft have made a huge mistake by leaving Austin. First of all they showed drivers and passengers just how little they cared about them; a lot of people in Austin were really angry at them and continue to be. Second, their stunt did not work. There was, obviously, a lot of backlash against the Mayor and local politicians but that has died down and the city has moved on. But lastly, and most importantly, the Austin market became available exclusively to all the other ridesharing apps, giving them a leg up and a source of reliable income and feedback. I get the feeling that next time this happens in another city, the other apps will similarly step in and take over the market. But this time they will be faster and better prepared.
mason240 10y ago
Kind of like how banning competition through taxi medallions are great because instead of investors and owners becoming rich, it just benefit drivers and riders.
clubm8 10y ago
One thing no one seems to talk about: a large chunk of the Uber drivers I've encountered are also Lyft drivers. If large chunks of people ditch Uber, Lyft could stand to grab the lion's share of the market.
- jethro_tell 10y ago
  This is really crazy to me. I feel like they missed an opportunity to build a moat by treating drivers as employees. Complete with health and non compete.
  - mdpopescu 10y ago
    On the other hand, I believe that non-exclusivity is partially responsible for their fast growth. (As a number of drivers, I mean.)
partiallypro 10y ago
How is what Austin did good? It dissuades capital investment and innovation. City governments were why rides were so expensive and service was poor for decades upon decades. Taxi licensing and medallions priced out everyone. Soon Austin's city government could easily be "captured" and limit the number of drivers, driving up ride prices and stifling competition. That wouldn't be market demand driving (unlike surge pricing.) That's actually why they passed the measure in the first place, the taxi lobby was incredibly strong. Now people I know in Austin use work around to use Uber.
- NathanKP 10y ago
  > That's actually why they passed the measure in the first place, the taxi lobby was incredibly strong. No the measure passed because Uber and Lyft failed to understand Austin culture and shot themselves in the foot by annoying Austinites with intrusive tactics that made them look bad in the eyes of a local culture that tends to be fiercely anti big business. It's the same type of mistake Airbnb made in SF with their big marketing campaign of 2015 that just offended everyone.
  - partiallypro 10y ago
    That's not what I've heard from insiders.
    - Neliquat 10y ago
      Well then share what you heard.
      - partiallypro 10y ago
        Politicians were captured by the taxi industry and exploited the liberal environment of Austin to achieve an effective ban on larger sharing services. What more is there to know?
    - mhayenga 10y ago
      As someone who voted "against" Uber/Lyft, I can promise you their PACs misleading and blatantly false propaganda regarding the city ordinance directly caused them to lose my vote. That and people love getting 4 fliers per day in their mailbox. Good riddance.
MBlume 10y ago
> and making their own app (Ride Austin) that isn't designed to make investors and owners rich, instead just benefit drivers and riders. As discussed upthread, Uber's investors and owners take a 20% loss on every ride. How much more benefit to drivers and riders do you want?

repomies69 10y ago

Wow, I didn't know about these. How well do those work? Do payments work automatically? What about reputation system?

NathanKP 10y ago
They work fantastically. Ride Austin is actually way better than Uber in my opinion. In fact even if Uber and Lyft decided to start following the city regulations and return to Austin I would probably never use either in Austin again, simply because I prefer the non profit approach that respects drivers and gives them a much higher percentage.
- jimmywanger 10y ago
  > because I prefer the non profit approach that respects drivers and gives them a much higher percentage For now. I generally prefer for-profit approaches because their motivations are far more transparent. They want to make money for the investors. Non-profits exist to serve the wishes of the donors, which may be opaque. For instance, the Ride Austin investors might suddenly decide that they really want to focus on transportation to/from low income areas or art festivals. That would degrade service, and there would be no accountability to the customer in that regard.
  - cityhall 10y ago
    What you want is competition, not for one entity to control the market regardless of its organization.
    - mulmen 10y ago
      Well in this case sure, competition is good and apparently Austin has multiple choices so everything is fine but competition is not always the answer. Competition does not seem to be the answer to public transit for example. It's not such a leap to say that ride sharing type apps might end up being replaced by a more personal and dynamic form of bus service.
  - NathanKP 10y ago
    Yeah I can understand that. Honestly, the non profit / coop thing is just a big part of Austin culture. Not only are food coops a pretty big deal in Austin, but when I lived in Austin even the electricity company that I got my power from was a coop (https://www.pec.coop/ https://www.pec.coop/) and if the coop made too much money it redistributed the profits back out as credits to member accounts. I generally ended up with one out of twelve months effectively being free because of profit credits being redistributed back out to my account. The whole culture of coops and nonprofit service organizations is something I really miss about Austin now that I no longer live there.
    - ambicapter 10y ago
      > if the coop made too much money it redistributed the profits back out as credits to member accounts. This is great and all, but wouldn't that money be more effectively utilized maintaining or upgrading the grid or investing in renewable energy? Seems like the co-op model never really invests in progress.
      - Doctor_Fegg 10y ago
        "never"? The (UK) Co-operative Bank was 99% powered by renewables in 2014.
      - NathanKP 10y ago
        I don't think coops are necessarily anti maintenance or investment. Obviously they have to maintain their core business just like any other business. The difference is a for profit company distributes extra profit that they have on top of their basic needs out as dividends to big investors and as salary for a CEO. On the other hand a coop distributes that same money out to all the customers.
    - jimmywanger 10y ago
      With for-profit enterprises, there's generally an objective measure of how well you're doing, the bottom line. Non profits, you can get a lot of people arguing about how to best fulfill the intents of the non-profit. In that situation, whoever argues the most persuasively or loudly wins, and it's the customers that suffer.
  - Spooky23 10y ago
    Your description of a non-profit pretty well lines up with Uber.
- wh-uws 10y ago
  Ride Austin is far from "way better" on par when the service works maybe but hardly better. This past Saturday none of the ride sharing services could handle demand and all went down. No riders could request and an no drivers could accept. Also when the service does work glitches like seeing the login screen when you are already logged in are routine. Source: I'm in Austin right now for sxsw and I'm a former Austin resident. Also this whole debacle was a clear and present tax grab for the city please dont pretend it wasn't. Now on balance Uber and Lyft ran an AWFUL campaign against the regulations when they already do background checks but still that was always about money.
  - ghaff 10y ago
    In all fairness, SXSW is a pretty severe stress test. FWIW, it can be hard to get personal transportation in a heavy rainstorm in NYC too.
  - wavefunction 10y ago
    I disagree with your "tax grab" angle since there is no evidence of that. Unless you mean that the city of Austin was somehow going to make money off fingerprinting?
    - thomasrognon 10y ago
      "(A) Each TNC operating in the City of Austin shall pay an annual fee calculated by the department based on one of the following methods of that TNCs choosing: (1) The total of the permit fee paid by taxicab companies times the number of persons driving for the TNC; (2) One (1) percent of the TNCs annual local gross revenues, or a comparable percentage of a TNCs portion of driver fares; or (3) Based on total miles driven. (B) Except for any TNC participating in the Safety Assurance Program, each TNC shall pay an additional fee of one (1) percent of the TNCs annual local gross revenue for the Compliant Driver Education Fund to be used to assist and incent drivers to become compliant." Also, it was about much more than just fingerprinting. Fingerprinting was emphasized because it would have affected Uber and Lyft's business model the most by reducing the supply of drivers due to higher onboarding friction. Here's the ordinance: https://www.austintexas.gov/edims/document.cfm%3Fid=245769 https://www.austintexas.gov/edims/document.cfm%3Fid=245769 Some more interesting parts: - "A TNC shall establish a driver-training program designed to ensure that each driver safely operates his or her vehicle prior to the driver being able to offer service" - "during periods of abnormal market disruptions, dynamic pricing shall be prohibited." - ...and the whole reporting section where they have to hand over all their internal operating data to the city
- Eridrus 10y ago
  I don't know how much Uber cost in Austin, but it seems like the base costs for calling a car are $4.50; I've gotten Uber rides for less than that in NYC, and the cost has been the prime reason to call them (I probably would have taken a bus otherwise). I am very interested to see if aggressive pricing and cost/route optimisation can unlock enough demand to make pooling actually viable economically, which none of the Uber/Lyft alternatives really seem willing to try.
- tbv 10y ago
  I believe you when you say you've had a good experience with Ride Austin, but I think you've been lucky. I've never been able to successfully book a ride with either Ride Austin or Fasten :\
seanca 10y ago
Very well. Now closing in on a year without Uber or Lyft, Fasten, Fare, and RideAustin have really come into their own as reliable options, especially on weekends that don't have extremely high demand numbers (ACL, SXSW, NYE weekends the apps have been less reliable).

deleted 10y ago

[deleted]

bbatsell 10y ago

Clearing up some serious misconceptions here: 1) Austin did not ban Uber or Lyft. The city council passed an ordinance that required a gradually increasing percentage of rideshare drivers pass an FBI-approved fingerprint background check. (These rules are in place in other locales in which Uber operates, such as NYC and Houston.) Uber and Lyft formed a PAC that got a proposition on the next local election ballot that would have overturned the ordinance, then spent $9 million on a massive advertising campaign supporting the proposition. The proposition failed overwhelmingly. 2) Uber and Lyft stopped providing services of their own volition within 48 hours. Considering they abide by the same regulations in other cities, it seems pretty obvious to me that it was done in retaliation in order to show other cities considering doing the same that they will actually pull out. 3) Several upstart ridesharing companies immediately jumped into the market and were fully operational in less than a month and are complying fully with the regulations. (Examples are Fasten, Fare, RideAustin, and GetMe.) 4) RideAustin is registered as a non-profit organization, formed by several local tech entrepreneurs affiliated with Capital Factory, an Austin accelerator/VC firm. It is not owned or operated by the city in any fashion.

NathanKP 10y ago
Yep I wasn't clear. Austin banned some of the wild west behavior of Uber and Lyft, and they refused to follow along with reasonable restrictions and decided to protest by leaving Austin.
r00fus 10y ago
#3 if anything should be proof to Uber's potential future investors that they need to be wary that Uber has anything but name recognition and first mover advantage. They have no moat, no barrier to entry, and a whole lot of hubris just waiting to mature in the form of fierce competitors and negative PR.
- pm90 10y ago
  To be fair, the new apps do suffer with reliability issues in periods of high loads. e.g. I would not, from experience, trust fasten to get me back home at 2.30am on a weekend night (even if I'm willing to pay their "boosted" fares). Its not an unsolvable problem though. I bet if they could hire more/better engineers and invest in infra for reliability they could be a lot better. And it might actually happen if Uber suddenly raises its prices and people look around for alternatives. I think Uber and Lyft have made a huge mistake by leaving Austin. First of all they showed drivers and passengers just how little they cared about them; a lot of people in Austin were really angry at them and continue to be. Second, their stunt did not work. There was, obviously, a lot of backlash against the Mayor and local politicians but that has died down and the city has moved on. But lastly, and most importantly, the Austin market became available exclusively to all the other ridesharing apps, giving them a leg up and a source of reliable income and feedback. I get the feeling that next time this happens in another city, the other apps will similarly step in and take over the market. But this time they will be faster and better prepared.

mason240 10y ago

Kind of like how banning competition through taxi medallions are great because instead of investors and owners becoming rich, it just benefit drivers and riders.

clubm8 10y ago

One thing no one seems to talk about: a large chunk of the Uber drivers I've encountered are also Lyft drivers. If large chunks of people ditch Uber, Lyft could stand to grab the lion's share of the market.

jethro_tell 10y ago
This is really crazy to me. I feel like they missed an opportunity to build a moat by treating drivers as employees. Complete with health and non compete.
- mdpopescu 10y ago
  On the other hand, I believe that non-exclusivity is partially responsible for their fast growth. (As a number of drivers, I mean.)

partiallypro 10y ago

How is what Austin did good? It dissuades capital investment and innovation. City governments were why rides were so expensive and service was poor for decades upon decades. Taxi licensing and medallions priced out everyone. Soon Austin's city government could easily be "captured" and limit the number of drivers, driving up ride prices and stifling competition. That wouldn't be market demand driving (unlike surge pricing.) That's actually why they passed the measure in the first place, the taxi lobby was incredibly strong. Now people I know in Austin use work around to use Uber.

NathanKP 10y ago
> That's actually why they passed the measure in the first place, the taxi lobby was incredibly strong. No the measure passed because Uber and Lyft failed to understand Austin culture and shot themselves in the foot by annoying Austinites with intrusive tactics that made them look bad in the eyes of a local culture that tends to be fiercely anti big business. It's the same type of mistake Airbnb made in SF with their big marketing campaign of 2015 that just offended everyone.
- partiallypro 10y ago
  That's not what I've heard from insiders.
  - Neliquat 10y ago
    Well then share what you heard.
    - partiallypro 10y ago
      Politicians were captured by the taxi industry and exploited the liberal environment of Austin to achieve an effective ban on larger sharing services. What more is there to know?
  - mhayenga 10y ago
    As someone who voted "against" Uber/Lyft, I can promise you their PACs misleading and blatantly false propaganda regarding the city ordinance directly caused them to lose my vote. That and people love getting 4 fliers per day in their mailbox. Good riddance.

MBlume 10y ago

> and making their own app (Ride Austin) that isn't designed to make investors and owners rich, instead just benefit drivers and riders. As discussed upthread, Uber's investors and owners take a 20% loss on every ride. How much more benefit to drivers and riders do you want?