5 ms·

It doesn't matter if Uber's not actually making money. And they're not, last I heard.

by rthomas6 10y ago

valuearb 10y ago
it only matters if they can. Few rapidly growing tech startups make money while still investing in growth.
- nebabyte 10y ago
  That 'growth' has included subsidizing rides, so their userbase once the 'growth' levels off will look radically different - likely diminished - from now. Obviously in larger cities the taxi model can and does thrive, but as Uber's price goes up, more frugal users comfortable with installing new apps will likely move to other platforms that offer the same basic service minus massive investor pockets to fill, while others might use it as a niche transport service for longer-distance ridesharing or as one of several taxi services in cities. Autonomous could save the margins there, but imo it's another front that Uber won't be able to afford fighting. Once the subsidizing ends, there'll be no love lost between Uber and users eager/happy to stick it to Kalanick and save a few bucks in the process, nor drivers who might've felt slighted/affronted by his or Uber's treatment of them, nor employees/users who don't care for the company's culture. Time's running out for Uber; whether or not it survives as a big fish basically comes down to how soon autonomous goes mainstream.
  - valuearb 10y ago
    Yea, autonomous has no bearing on the market. If it becomes a thing Uber will just go autonomous. In the meantime people won't switch because of branding. They will already have Uber on their phone and be comfortable with it. It will take a lot to get people to switch. Branding is a huge competitive advantage. Better colas than Coke have been developed for a hundred years and they still grew market share. Uber will get market rates, whatever they are and will make tons of money because their business model is super efficient. It should only cost pennies to dispatch each ride, they get dollars in revenue from each ride, and are developing huge economies of scale cab dispatch companies have never had. As soon as they stop investing so heavily on opening new markets and businesses their income statement is going to look a whole lot different.
- quizzas 10y ago
  The problem is market maturity. If Uber is currently facing a quickly maturing market, the upside is limited. Investing in growth is much different than investing in diversification. For example, Google's ad-click market is completely mature, there is very little new growth there. So all their investments are in something new to add to their revenue pipeline, whether that will be AR or autonomous technologies. The fact that Uber is already seeing a loss of market share indicates that market maturity is fast approaching. How much of their investment is simply protectionism to maintain market share rather than growth?

It doesn't matter if Uber's not actually making money. And they're not, last I heard.

valuearb 10y ago

it only matters if they can. Few rapidly growing tech startups make money while still investing in growth.

nebabyte 10y ago
That 'growth' has included subsidizing rides, so their userbase once the 'growth' levels off will look radically different - likely diminished - from now. Obviously in larger cities the taxi model can and does thrive, but as Uber's price goes up, more frugal users comfortable with installing new apps will likely move to other platforms that offer the same basic service minus massive investor pockets to fill, while others might use it as a niche transport service for longer-distance ridesharing or as one of several taxi services in cities. Autonomous could save the margins there, but imo it's another front that Uber won't be able to afford fighting. Once the subsidizing ends, there'll be no love lost between Uber and users eager/happy to stick it to Kalanick and save a few bucks in the process, nor drivers who might've felt slighted/affronted by his or Uber's treatment of them, nor employees/users who don't care for the company's culture. Time's running out for Uber; whether or not it survives as a big fish basically comes down to how soon autonomous goes mainstream.
- valuearb 10y ago
  Yea, autonomous has no bearing on the market. If it becomes a thing Uber will just go autonomous. In the meantime people won't switch because of branding. They will already have Uber on their phone and be comfortable with it. It will take a lot to get people to switch. Branding is a huge competitive advantage. Better colas than Coke have been developed for a hundred years and they still grew market share. Uber will get market rates, whatever they are and will make tons of money because their business model is super efficient. It should only cost pennies to dispatch each ride, they get dollars in revenue from each ride, and are developing huge economies of scale cab dispatch companies have never had. As soon as they stop investing so heavily on opening new markets and businesses their income statement is going to look a whole lot different.
quizzas 10y ago
The problem is market maturity. If Uber is currently facing a quickly maturing market, the upside is limited. Investing in growth is much different than investing in diversification. For example, Google's ad-click market is completely mature, there is very little new growth there. So all their investments are in something new to add to their revenue pipeline, whether that will be AR or autonomous technologies. The fact that Uber is already seeing a loss of market share indicates that market maturity is fast approaching. How much of their investment is simply protectionism to maintain market share rather than growth?