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Bitter/hating much? I know Uber is not liked, but the fact that they have done a great job at disturbing the market in a great way. (Lyft as well, but they ar

by ardit33 10y ago

Bitter/hating much? I know Uber is not liked, but the fact that they have done a great job at disturbing the market in a great way. (Lyft as well, but they are still a minority player) Having have to deal with NYC cabs often, when they will lock the doors and ask where you are going before letting you in, Uber is a great improvement overall. Also, a NYC taxi medallion would cost 500k to almost 750k (that's like a mortgage). Basically half of your fare is going to some dude's coffers, and not to the drivers and taxis. Classical rent seeking behaviour caused by misguided regulation. Glad to see an outsider disrupt it.

JohnJamesRambo 10y ago
But aren't they just disrupting it temporarily? My understanding is that VC funding is propping up those low fares. I guess it is good until that runs out though.
- kornish 10y ago
  Well, part of Uber's strategy was to subsidize rides with VC funding until they could have fleets of self-driving cars to provide rides at truly low costs (and thus efficient unit economics). We'll see how well that plays out in light of the Waymo lawsuit.
- thinkloop 10y ago
  The medallion is a huge cost, that alone might be enough - not to mention economies of scale, logistics expertise, data collection value, uber pool network effect, etc.
  - giaour 10y ago
    It's not like medallion cabs were the only game in town before Uber came along. Black car services have been popular as taxi alternatives for decades.
    - dx034 10y ago
      But were only an option if you are from the city. There's a considerable risk ordering any minicab service if you don't know your way around the city. Uber and Lyft change that by verifying drivers.
- deleted 10y ago
  [deleted]
- nikcub 10y ago
  There is nothing wrong with their financial model at the moment - it's just high stakes, winner takes all, swing for the fences style of company building. The most famous example is Amazon, fueling growth with raised capital over emphasis if profits. It lets them capture market and mindshare and do it extremely cheaply - Uber has raised $8B for what is likely less than a third of the company - including $5B at $90B+ only 8 months ago This is exactly what investors want - turn what some might grow to be a respectable 20-30x return into 1000x and a shot at global domination. Its amazing how global uber is - it really has total mindshare outside of the small number of areas competitors operate. I've heard "uber" used as a verb in 4 languages and in about a dozen different countries. Uber claim they're profitable in older markets on a margin basis. That bodes well for being able to grow into profitability as you run out of countries to grow into, which is a little better and different to Amazon.com's "flicking the profit switch"
- mahyarm 10y ago
  Your still not paying for a taxi medalion
- marcosdumay 10y ago
  That half of the cost due to medallions isn't temporary. Whatever was there due to supply restrictions isn't temporary either. Uber still subsidizes the price beyond rents and supply restrictions. That part is temporary.
brainflake 10y ago
Have you really had that experience in NYC? I've lived in Brooklyn for 10 years and have only once had a cab refuse to drive me home.
- URSpider94 10y ago
  Many times, yes.
- hueving 10y ago
  Perhaps you haven't committed the crime of living in a poor neighborhood or looking like a minority.
  - pbhjpbhj 10y ago
    Aren't most taxi drivers [in NYC] from "minority" populations? Do they really discriminate in this way?
    - hueving 10y ago
      Yes, some the most racist taxi drivers I have encountered were minorities with prejudices against other minorities. Everyone is afraid to call a minority a bigot so this behavior tends to be unchecked compared to when a white guy does it.
  - brainflake 10y ago
    That's a good point. I've lived in poor neighborhoods but I'm not a minority.
- garethsprice 10y ago
  Try getting a cab in Manhattan at peak times, or during shift change (6pm-ish?). Technically they have to take you by law but even if you get in and refuse to move they will sit there until you are forced to get out. It got to the point I was getting turned down more than accepted for rides from Manhattan to Brooklyn so now I just use ride share by default. (For reference, I'm white so it's not a problem of being a minority. I do live pretty deep in Brooklyn in a "bad" neighborhood though - maybe getting a ride to Williamsburg etc is easier)

by ardit33 10y ago

JohnJamesRambo 10y ago

But aren't they just disrupting it temporarily? My understanding is that VC funding is propping up those low fares. I guess it is good until that runs out though.

kornish 10y ago
Well, part of Uber's strategy was to subsidize rides with VC funding until they could have fleets of self-driving cars to provide rides at truly low costs (and thus efficient unit economics). We'll see how well that plays out in light of the Waymo lawsuit.
thinkloop 10y ago
The medallion is a huge cost, that alone might be enough - not to mention economies of scale, logistics expertise, data collection value, uber pool network effect, etc.
- giaour 10y ago
  It's not like medallion cabs were the only game in town before Uber came along. Black car services have been popular as taxi alternatives for decades.
  - dx034 10y ago
    But were only an option if you are from the city. There's a considerable risk ordering any minicab service if you don't know your way around the city. Uber and Lyft change that by verifying drivers.
deleted 10y ago
[deleted]
nikcub 10y ago
There is nothing wrong with their financial model at the moment - it's just high stakes, winner takes all, swing for the fences style of company building. The most famous example is Amazon, fueling growth with raised capital over emphasis if profits. It lets them capture market and mindshare and do it extremely cheaply - Uber has raised $8B for what is likely less than a third of the company - including $5B at $90B+ only 8 months ago This is exactly what investors want - turn what some might grow to be a respectable 20-30x return into 1000x and a shot at global domination. Its amazing how global uber is - it really has total mindshare outside of the small number of areas competitors operate. I've heard "uber" used as a verb in 4 languages and in about a dozen different countries. Uber claim they're profitable in older markets on a margin basis. That bodes well for being able to grow into profitability as you run out of countries to grow into, which is a little better and different to Amazon.com's "flicking the profit switch"
mahyarm 10y ago
Your still not paying for a taxi medalion
marcosdumay 10y ago
That half of the cost due to medallions isn't temporary. Whatever was there due to supply restrictions isn't temporary either. Uber still subsidizes the price beyond rents and supply restrictions. That part is temporary.

brainflake 10y ago

Have you really had that experience in NYC? I've lived in Brooklyn for 10 years and have only once had a cab refuse to drive me home.

URSpider94 10y ago
Many times, yes.
hueving 10y ago
Perhaps you haven't committed the crime of living in a poor neighborhood or looking like a minority.
- pbhjpbhj 10y ago
  Aren't most taxi drivers [in NYC] from "minority" populations? Do they really discriminate in this way?
  - hueving 10y ago
    Yes, some the most racist taxi drivers I have encountered were minorities with prejudices against other minorities. Everyone is afraid to call a minority a bigot so this behavior tends to be unchecked compared to when a white guy does it.
- brainflake 10y ago
  That's a good point. I've lived in poor neighborhoods but I'm not a minority.
garethsprice 10y ago
Try getting a cab in Manhattan at peak times, or during shift change (6pm-ish?). Technically they have to take you by law but even if you get in and refuse to move they will sit there until you are forced to get out. It got to the point I was getting turned down more than accepted for rides from Manhattan to Brooklyn so now I just use ride share by default. (For reference, I'm white so it's not a problem of being a minority. I do live pretty deep in Brooklyn in a "bad" neighborhood though - maybe getting a ride to Williamsburg etc is easier)