16 ms·

This is a thoughtful analysis into the whole Uber CEO opinion, but it is opinionated. Aggregation theory is one way to derive Uber's value, but you can make a c

by dannyw 9y ago

This is a thoughtful analysis into the whole Uber CEO opinion, but it is opinionated. Aggregation theory is one way to derive Uber's value, but you can make a compelling argument that supply drives demand. The reason why I don't use taxis in Australia is partly because the experience is far better with Uber and the cost is cheaper, but also because Uber is the most reliable. Without drivers and such reliability, I can't use Uber even if I want to. Does demand drive supply? Yes. But does supply drive demand? Yes too. With a two sided marketplace, you can't just focus on one.

agandy 9y ago
I don't think the author makes any claims that this is anything other than a positive feedback loop. He's mainly saying that it makes sense for Uber to prioritize the user experience over anything else in order to further accelerate growth.
erikb 9y ago
With "driving demand" you don't mean "creating demand" but "directing demand to my business instead of the competitors", right? Because it sounds a little like you want to say "creating demand", but your demand to go from A to B is already created before you choose between a Taxi and Uber. You don't decide to go to B because Uber exists.
- SomeStupidPoint 9y ago
  Conceivably, I could decide to make three trips (to B, C, and D) instead of just two trips (to B and C) because Uber is cheaper/nicer/better/etc than other forms of travel. My demand for travel is somewhat elastic, not completely set before I know the cost of travel.
- ssalazar 9y ago
  In markets with unreliable, inconvenient, or overpriced taxi service your options before Uber were to drive yourself, have a friend drive you, use public transportation, rough it in a taxi that may or may not show up and do so 30 minutes late, or simply not go. Since low quality was previously a barrier to using any taxi service at all, it absolutely creates demand.
  - mseebach 9y ago
    It seems that what you're describing is "simply" meeting existing unfulfilled demand, not creating new demand. Creating new demand would be when you move to a part of town with poor public transport because you can now Uber.
- JumpCrisscross 9y ago
  > your demand to go from A to B is already created before you choose between a Taxi and Uber In the Bay Area and New York City, for me, this is untrue. Distances feel smaller when you can cross them with the press of a button. That, in turn, makes peripatetic schedules realistic. Case in point: I took a Lyft Line from Berkeley to Mountain View yesterday. If that wasn't an option, I would have (a) taken the train or (b) not gone that far.
  - erikb 9y ago
    Many comments say it as yours. After reading them I have to agree. I spend most of my time in areas with highly developed public transport. I assumed in the US at least taxis would offer a similar level of flexibility, but apparently not.
    - cwilkes 9y ago
      In Seattle the taxis usually gather at designated pickup spots, in fact I think there's a law about them only being able to pick up from there or if they are called vs hailing from the street. In the past I've helped tourists by directing them to these locations which aren't noted anywhere. So it can be really confusing plus inconvenient. That's one of the reasons I like Uber and the like: I don't have to know what to do.
- dagw 9y ago
  your demand to go from A to B is already created before you choose between a Taxi and Uber. If getting from A to B is time consuming and expensive then I might not bother unless it's really important. By lowering the costs of getting from A to B I might do it more often than I would otherwise.
- morgante 9y ago
  > You don't decide to go to B because Uber exists. Actually, I absolutely do. I've gone on many trips that I simply wouldn't have gone on pre-Uber. On a regular basis I'll decide to go somewhere (ex. a party in Brooklyn) which I wouldn't have bothered with if it meant a slow and unreliable taxi (or an even slower subway ride).
  - feedjoelpie 9y ago
    Just curious: What makes you call Uber fast and taxis unreliable in NYC? I would agree with you in almost any other market, but I find getting a taxi in NYC using Curb just as fast and reliable, yet cheaper.
    - tashoecraft 9y ago
      Cabs in NYC are simply a terrible experience that needs to step up. Since they don't really care about you, I've had refusals to turn on AC, them blasting music or talking loudly on the phone, and even one guy pulling his emergency brake and telling me "my brakes aren't working you need to get out" because he didn't want to go from battery park to Williamsburg. I will go out of my way to not use a cab, I'll pay more, deal with more inconvenience because cabs are just a terrible experience that I don't want to deal with anymore.
    - Zach_the_Lizard 9y ago
      In Manhattan below 110 street or so, taxis are reliable if your destination is also in Manhattan below 110 street or so. Also from the airports they're generally reliable. However, if you go from Manhattan to Queens you'll find they sometimes suddenly "forget" how to get there despite 90% of them living in Queens because they won't reliably get a return fare. Same in the rest of the boroughs. Also they often have "broken" credit card readers that magically get repaired after fighting with them. The cars are not always in the best condition. The other day I rode in a cab that had no suspension it seemed. Every bump in the road would send you flying. It was a nauseating experience, let me tell you. I still take taxis from time to time, especially when there's no real price difference or when I don't want to wait. A late night flight I might take an Uber to the airport and a taxi back if the wait time is too long. With Uber and Lyft I generally get clean cars with suspensions and don't have to worry about paying them (Already handled!), refusing service, etc. Although you get bad service from time to time in all transportation providers, Uber and Lyft tend to be much more consistent.
- ghaff 9y ago
  Demand is absolutely elastic (to a certain point) on a number of dimensions: price, time, comfort, hassle. There's an upper limit. The trip from A to B usually has some negative utility relative to being at B but the closer to zero you can make it, the more likely you are to make the trip. Personally, I just don't have many situations where I would make a trip but my available alternatives are just a bit too costly/inconvenient--while Uber wouldn't be. But I understand they exist.
robryan 9y ago
Yeah, I would never book a Taxi for spur of the moment travel in Melbourne but with Uber there will pretty much always be one within 5-10mins.
puranjay 9y ago
It's very interesting in India where you have enormous supply of auto-rickshaws ('tuk tuks') available in most public spaces. Often, when I'm in public, I'll choose an auto-rickshaw instead of an Uber because the rickshaw is right there. I don't have to wait for it, don't have to give it directions to find me. The service is worse - I have to haggle about prices, endure bumpy rides and dangerous driving - but the easy availability makes me choose them.
- deleted 9y ago
  [deleted]
- nhaehnle 9y ago
  Amusingly, India is the only place where I've used Uber so far, precisely because using an app is the best way to not get screwed over as a foreigner.
  - vadym909 9y ago
    I wouldn't be so sure - Ola is a lot more popular in India and using Uber is usually a giveaway that you may not be familiar with the routes.
    - lhorie 9y ago
      I think the point is that as a foreigner, you're more likely to have Uber already installed than even knowing about Ola/Didi/whatever happens to be popular in a given country
  - overcast 9y ago
    While I didn't use Uber in India, Mexico City was the same experience for me. In fact our local office strongly encouraged us ONLY to use Uber over anything else. It was by far the quickest, and safest way to get around.
- praneshp 9y ago
  I'm from Chennai, where the auto-drivers are very very infamous. I usually don't mind waiting for the Uber if that means no interaction with auto drivers.
bbarn 9y ago
> the company offers a compelling service for riders, an economically attractive one for drivers (who drive by choice), and makes the cities within which it operates better. Incredibly opinionated. It's a pretty disputed claim that more single passenger traffic improves a city.
- malandrew 9y ago
  Uber at least always shows you both Pool and X trip times and prices at the same time when ordering. This at least gives every X passenger the opportunity to consider a Pool trip first.
  - te_chris 9y ago
    Yes but why would you choose it? It's the most awkward experience I've ever had in my life
    - exhilaration 9y ago
      Because sometimes it's close to half the price? Some of us like saving $5 or $10 per ride.
    - kinkrtyavimoodh 9y ago
      In what ways was it awkward?
    - Shorel 9y ago
      Because cars are a bit less wasteful with pool?
    - jonknee 9y ago
      Some people have less money and a higher tolerance of strangers?
    - ch4s3 9y ago
      Despite having a dim view of Uber and Lyft generally, I've had good experiences in Pools. I find that they're a great way to get recommendations for bars/restaurants/events in the area, and you have either a source or destination in common. People are usually either friendly or silent. Not only that, but Pool encourages better transport resource utilization.

by dannyw 9y ago

agandy 9y ago

I don't think the author makes any claims that this is anything other than a positive feedback loop. He's mainly saying that it makes sense for Uber to prioritize the user experience over anything else in order to further accelerate growth.

erikb 9y ago

With "driving demand" you don't mean "creating demand" but "directing demand to my business instead of the competitors", right? Because it sounds a little like you want to say "creating demand", but your demand to go from A to B is already created before you choose between a Taxi and Uber. You don't decide to go to B because Uber exists.

SomeStupidPoint 9y ago
Conceivably, I could decide to make three trips (to B, C, and D) instead of just two trips (to B and C) because Uber is cheaper/nicer/better/etc than other forms of travel. My demand for travel is somewhat elastic, not completely set before I know the cost of travel.
ssalazar 9y ago
In markets with unreliable, inconvenient, or overpriced taxi service your options before Uber were to drive yourself, have a friend drive you, use public transportation, rough it in a taxi that may or may not show up and do so 30 minutes late, or simply not go. Since low quality was previously a barrier to using any taxi service at all, it absolutely creates demand.
- mseebach 9y ago
  It seems that what you're describing is "simply" meeting existing unfulfilled demand, not creating new demand. Creating new demand would be when you move to a part of town with poor public transport because you can now Uber.
JumpCrisscross 9y ago
> your demand to go from A to B is already created before you choose between a Taxi and Uber In the Bay Area and New York City, for me, this is untrue. Distances feel smaller when you can cross them with the press of a button. That, in turn, makes peripatetic schedules realistic. Case in point: I took a Lyft Line from Berkeley to Mountain View yesterday. If that wasn't an option, I would have (a) taken the train or (b) not gone that far.
- erikb 9y ago
  Many comments say it as yours. After reading them I have to agree. I spend most of my time in areas with highly developed public transport. I assumed in the US at least taxis would offer a similar level of flexibility, but apparently not.
  - cwilkes 9y ago
    In Seattle the taxis usually gather at designated pickup spots, in fact I think there's a law about them only being able to pick up from there or if they are called vs hailing from the street. In the past I've helped tourists by directing them to these locations which aren't noted anywhere. So it can be really confusing plus inconvenient. That's one of the reasons I like Uber and the like: I don't have to know what to do.
dagw 9y ago
your demand to go from A to B is already created before you choose between a Taxi and Uber. If getting from A to B is time consuming and expensive then I might not bother unless it's really important. By lowering the costs of getting from A to B I might do it more often than I would otherwise.
morgante 9y ago
> You don't decide to go to B because Uber exists. Actually, I absolutely do. I've gone on many trips that I simply wouldn't have gone on pre-Uber. On a regular basis I'll decide to go somewhere (ex. a party in Brooklyn) which I wouldn't have bothered with if it meant a slow and unreliable taxi (or an even slower subway ride).
- feedjoelpie 9y ago
  Just curious: What makes you call Uber fast and taxis unreliable in NYC? I would agree with you in almost any other market, but I find getting a taxi in NYC using Curb just as fast and reliable, yet cheaper.
  - tashoecraft 9y ago
    Cabs in NYC are simply a terrible experience that needs to step up. Since they don't really care about you, I've had refusals to turn on AC, them blasting music or talking loudly on the phone, and even one guy pulling his emergency brake and telling me "my brakes aren't working you need to get out" because he didn't want to go from battery park to Williamsburg. I will go out of my way to not use a cab, I'll pay more, deal with more inconvenience because cabs are just a terrible experience that I don't want to deal with anymore.
  - Zach_the_Lizard 9y ago
    In Manhattan below 110 street or so, taxis are reliable if your destination is also in Manhattan below 110 street or so. Also from the airports they're generally reliable. However, if you go from Manhattan to Queens you'll find they sometimes suddenly "forget" how to get there despite 90% of them living in Queens because they won't reliably get a return fare. Same in the rest of the boroughs. Also they often have "broken" credit card readers that magically get repaired after fighting with them. The cars are not always in the best condition. The other day I rode in a cab that had no suspension it seemed. Every bump in the road would send you flying. It was a nauseating experience, let me tell you. I still take taxis from time to time, especially when there's no real price difference or when I don't want to wait. A late night flight I might take an Uber to the airport and a taxi back if the wait time is too long. With Uber and Lyft I generally get clean cars with suspensions and don't have to worry about paying them (Already handled!), refusing service, etc. Although you get bad service from time to time in all transportation providers, Uber and Lyft tend to be much more consistent.
ghaff 9y ago
Demand is absolutely elastic (to a certain point) on a number of dimensions: price, time, comfort, hassle. There's an upper limit. The trip from A to B usually has some negative utility relative to being at B but the closer to zero you can make it, the more likely you are to make the trip. Personally, I just don't have many situations where I would make a trip but my available alternatives are just a bit too costly/inconvenient--while Uber wouldn't be. But I understand they exist.

robryan 9y ago

Yeah, I would never book a Taxi for spur of the moment travel in Melbourne but with Uber there will pretty much always be one within 5-10mins.

puranjay 9y ago

It's very interesting in India where you have enormous supply of auto-rickshaws ('tuk tuks') available in most public spaces. Often, when I'm in public, I'll choose an auto-rickshaw instead of an Uber because the rickshaw is right there. I don't have to wait for it, don't have to give it directions to find me. The service is worse - I have to haggle about prices, endure bumpy rides and dangerous driving - but the easy availability makes me choose them.

deleted 9y ago
[deleted]
nhaehnle 9y ago
Amusingly, India is the only place where I've used Uber so far, precisely because using an app is the best way to not get screwed over as a foreigner.
- vadym909 9y ago
  I wouldn't be so sure - Ola is a lot more popular in India and using Uber is usually a giveaway that you may not be familiar with the routes.
  - lhorie 9y ago
    I think the point is that as a foreigner, you're more likely to have Uber already installed than even knowing about Ola/Didi/whatever happens to be popular in a given country
- overcast 9y ago
  While I didn't use Uber in India, Mexico City was the same experience for me. In fact our local office strongly encouraged us ONLY to use Uber over anything else. It was by far the quickest, and safest way to get around.
praneshp 9y ago
I'm from Chennai, where the auto-drivers are very very infamous. I usually don't mind waiting for the Uber if that means no interaction with auto drivers.

bbarn 9y ago

> the company offers a compelling service for riders, an economically attractive one for drivers (who drive by choice), and makes the cities within which it operates better. Incredibly opinionated. It's a pretty disputed claim that more single passenger traffic improves a city.

malandrew 9y ago
Uber at least always shows you both Pool and X trip times and prices at the same time when ordering. This at least gives every X passenger the opportunity to consider a Pool trip first.
- te_chris 9y ago
  Yes but why would you choose it? It's the most awkward experience I've ever had in my life
  - exhilaration 9y ago
    Because sometimes it's close to half the price? Some of us like saving $5 or $10 per ride.
  - kinkrtyavimoodh 9y ago
    In what ways was it awkward?
  - Shorel 9y ago
    Because cars are a bit less wasteful with pool?
  - jonknee 9y ago
    Some people have less money and a higher tolerance of strangers?
  - ch4s3 9y ago
    Despite having a dim view of Uber and Lyft generally, I've had good experiences in Pools. I find that they're a great way to get recommendations for bars/restaurants/events in the area, and you have either a source or destination in common. People are usually either friendly or silent. Not only that, but Pool encourages better transport resource utilization.