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There are a few reasons this is hard. 1) I'd imagine there are significant costs to entering a new city. Uber is a two-sided marketplace so in any new city Ube
by abvdasker 9y ago
There are a few reasons this is hard.
1) I'd imagine there are significant costs to entering a new city. Uber is a two-sided marketplace so in any new city Uber needs to invest resources and time into acquiring supply/drivers and to a lesser extent users. Combine this with the operational support to maintain that marketplace and the overhead becomes non-negligible.
2) First mover advantage is a real thing so any ride-sharing network that enters a city with an established player is going to have a harder time acquiring the aforementioned supply/demand.
3) When more than one ride-sharing company is in a city it eventually turns into a subsidy war for demand. From what I have read this is what happened to Uber competing with Didi in China and resulted in massive losses for both companies.
TL;DR entering new markets is in fact pretty expensive, and far more so when there is existing competition.
- curun1r 9y agoIt's only a two-sided marketplace if you need drivers. If Google uses Waymo tech to remove drivers from the equation, there's only one side to the market that they have to consider, which makes it a much easier proposition to enter those markets. The legal/compliance issues are probably the bigger hurdle since they can't hide behind "independent contractors" the way Uber has.