4 ms·

Most discussions seem to take for granted that the self driving cars as a service would equally service all participants at all times. The operators will be in

by sharmi 9y ago

Most discussions seem to take for granted that the self driving cars as a service would equally service all participants at all times. The operators will be incentivised to service maximum people with minimum number of cars. At any point where there is high demand, there would not be enough cars to service everyone. So again, those who can afford it would opt to hace their own cars. If everyone is forced to use the self driving service, there comes the question of how the system prioritizes pickups, young vs old, healthy vs sick, the vulnerable etc. So, I believe it will still settle into the more wealthy using an elite service or owning their own car and others using a system not too different from a public transportation system, only self-driven.

dredmorbius 9y ago
The operators will be incentivised to obtain maximum revenue with a minimum cost. That will likely lead to similar dynamics of other transport modes: 1. A high-priced, high-amenity premium "first class" (perhaps "white glove") service, catering to upper-income / high-discretionary-spending households. 2. Possibly: a moderate-tier, principally professional-employment / shopping-oriented tier. The primary support for this will come from the businesses served by the livery, notably professional employers (a transport/commute perk) and upscale shopping districts (to increase in-store traffic). I'm presuming that brick-and-mortar retail will remain a thing, and given a less-than 10% incursion by e-commerce, this seems likely. 3. A bare-bones "economy" tier. This will be made intentionally bad, not because of price, but because any amenity enhancement will erode demand to the higher-priced tiers. This will be offered to low-income households, and possibly to noneconomic sectors (children, students, handicapped, elderly). One characteristic of transport services dating to the dawn of large-scale passenger ship travel and rail service is that the lowest-tier amenities are made intentionally worse than necessary, for the logic outlined above.
- fulafel 9y ago
  100 years ago large passanger ships and railways were enormous investments that made it hard for competitors to enter the market, but the barrier to entry in driverless taxi service can be quite low. Regulation is another way that intentionally bad service can be fixed, it's widely done in rail and air travel.
  - dredmorbius 9y ago
    To be clear: the competition wasn't from other operators but between service classes. The commercial airline market is one in which there is route competition between carriers ... and yet there remains a race-to-the-bottom dynamic in economy class (that is, third-class) accomodations. If anything, an open-competition market will tend to further erode bottom-end margins. I also suspect it will tend to produce extralegal competitive dynamics, e.g., mob influence.
    - fulafel 9y ago
      In a competed market, cost savings that are passed on to consumers in exchange for less comfort is just normal business following consumer preferences. In many of the world (not familiar with the US), the minimum level of comfort is regulated and some consumers would probably go for even less comfort if airlines were allowed to provide it.
      - dredmorbius 9y ago
        The argument otherwise is long, but fairly well founded. I'd point generally to regulatory floors in service (or safety) levels, the dynamics of Gresham's Law and "race-to-the-bottom" dynamics, information asymmetries (Akerlof, "The Market for Lemons"), among other elements. The fact that a "free market" (or generally: one devoid of regulation or moral buttress) seeks a particular level does not make that level good. Untreated wood rots, unpainted steel rusts. These are natural tendencies. I'll posit they're not preferable to alternatives.
- majewsky 9y ago
  As a counter-point: There used to be three travel classes on trains at least here in Germany, but today, only two are left (basically "white glove" and "economy"). EDIT: Also, what does "first class" entail in the context of self-driving cars? Most differentiation between travel classes is in the area of service by train/flight attendants. The only thing I could think of is the comfortableness of the seat and the amount of leg space.
  - dredmorbius 9y ago
    Appointments, SLA, and quite probably some level of arbitrarily selected Veblen differentiators. Much as elsewhere. Private vs. shared space as well -- think an service which might collect and drop off multiple passengers en route. The ultimate differentiator would likely be a dedicated chauffeur.

by sharmi 9y ago

dredmorbius 9y ago

The operators will be incentivised to obtain maximum revenue with a minimum cost. That will likely lead to similar dynamics of other transport modes: 1. A high-priced, high-amenity premium "first class" (perhaps "white glove") service, catering to upper-income / high-discretionary-spending households. 2. Possibly: a moderate-tier, principally professional-employment / shopping-oriented tier. The primary support for this will come from the businesses served by the livery, notably professional employers (a transport/commute perk) and upscale shopping districts (to increase in-store traffic). I'm presuming that brick-and-mortar retail will remain a thing, and given a less-than 10% incursion by e-commerce, this seems likely. 3. A bare-bones "economy" tier. This will be made intentionally bad, not because of price, but because any amenity enhancement will erode demand to the higher-priced tiers. This will be offered to low-income households, and possibly to noneconomic sectors (children, students, handicapped, elderly). One characteristic of transport services dating to the dawn of large-scale passenger ship travel and rail service is that the lowest-tier amenities are made intentionally worse than necessary, for the logic outlined above.

fulafel 9y ago
100 years ago large passanger ships and railways were enormous investments that made it hard for competitors to enter the market, but the barrier to entry in driverless taxi service can be quite low. Regulation is another way that intentionally bad service can be fixed, it's widely done in rail and air travel.
- dredmorbius 9y ago
  To be clear: the competition wasn't from other operators but between service classes. The commercial airline market is one in which there is route competition between carriers ... and yet there remains a race-to-the-bottom dynamic in economy class (that is, third-class) accomodations. If anything, an open-competition market will tend to further erode bottom-end margins. I also suspect it will tend to produce extralegal competitive dynamics, e.g., mob influence.
  - fulafel 9y ago
    In a competed market, cost savings that are passed on to consumers in exchange for less comfort is just normal business following consumer preferences. In many of the world (not familiar with the US), the minimum level of comfort is regulated and some consumers would probably go for even less comfort if airlines were allowed to provide it.
    - dredmorbius 9y ago
      The argument otherwise is long, but fairly well founded. I'd point generally to regulatory floors in service (or safety) levels, the dynamics of Gresham's Law and "race-to-the-bottom" dynamics, information asymmetries (Akerlof, "The Market for Lemons"), among other elements. The fact that a "free market" (or generally: one devoid of regulation or moral buttress) seeks a particular level does not make that level good. Untreated wood rots, unpainted steel rusts. These are natural tendencies. I'll posit they're not preferable to alternatives.
majewsky 9y ago
As a counter-point: There used to be three travel classes on trains at least here in Germany, but today, only two are left (basically "white glove" and "economy"). EDIT: Also, what does "first class" entail in the context of self-driving cars? Most differentiation between travel classes is in the area of service by train/flight attendants. The only thing I could think of is the comfortableness of the seat and the amount of leg space.
- dredmorbius 9y ago
  Appointments, SLA, and quite probably some level of arbitrarily selected Veblen differentiators. Much as elsewhere. Private vs. shared space as well -- think an service which might collect and drop off multiple passengers en route. The ultimate differentiator would likely be a dedicated chauffeur.