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It does on the supply side. It keeps drivers on the Uber network, which is good for both the rides business and the Eats business due to more consistent supply,

It does on the supply side. It keeps drivers on the Uber network, which is good for both the rides business and the Eats business due to more consistent supply, and good for drivers due to higher total volume of work. The eventual result is that Uber can operate more efficiently than competitors that only do rides or food, allowing them to compete better in both markets. (I used to work at Uber)

clairity 8y ago
exactly. ubereats is a flanking product, meant to protect the core business. strategically, uber really only has market power on the supply side, and ubereats is primarily about protecting that advantage and less about being a standalone business (although i'm sure they'd be thrilled if it succeeded as a standalone business). i'd be surprised if ubereats went away any time soon. at least, not without something else replacing it.
- slivym 8y ago
  In European markets there is literally no overlap between Uber Eats and Uber. Uber drivers are driving Toyotas, Uber eats drivers are riding mopeds and bicycles. You can't just switch from one to the other.
  - flak48 8y ago
    Same in Asia
konschubert 8y ago
I'd go even further. I'd say that Uber has zero moat in it's core business, anyone with a little bit of cash can roll out a competitive alternative in any city onces Uber raises prices. But with Uber eats, a competitor has to also roll out meal delivery in order to be equally profitable and thus competitive. Still not a huge moat, but a little bit harder to beat.
- valuearb 8y ago
  Disagree, in fact i see it the opposite way. Uber has a huge most that Eats adds almost nothing to. Every day millions of people reach into their pockets to request a ride using the Uber app. Competing with Uber means a) recruit large numbers of drivers so your app has rides to offer. b) convincing large numbers of people to download your app. c) convincing them to make your app their primary ride share choice. Even tackling a small city would be horrendously expensive. If it truly was easy Uber would be getting eaten alive by numerous small startups in every major city they operate in.
WorkLifeBalance 8y ago
Does this work in jurisdictions such as London where there are extra checks that drivers must pass? I can't imagine that a food delivery service could be competitive using drivers rated for safe person delivery. Is the driver fleet for Uber eats even the same as the minicab fleet or is it really just another business?

clairity 8y ago

exactly. ubereats is a flanking product, meant to protect the core business. strategically, uber really only has market power on the supply side, and ubereats is primarily about protecting that advantage and less about being a standalone business (although i'm sure they'd be thrilled if it succeeded as a standalone business). i'd be surprised if ubereats went away any time soon. at least, not without something else replacing it.

slivym 8y ago
In European markets there is literally no overlap between Uber Eats and Uber. Uber drivers are driving Toyotas, Uber eats drivers are riding mopeds and bicycles. You can't just switch from one to the other.
- flak48 8y ago
  Same in Asia

konschubert 8y ago

I'd go even further. I'd say that Uber has zero moat in it's core business, anyone with a little bit of cash can roll out a competitive alternative in any city onces Uber raises prices. But with Uber eats, a competitor has to also roll out meal delivery in order to be equally profitable and thus competitive. Still not a huge moat, but a little bit harder to beat.

valuearb 8y ago
Disagree, in fact i see it the opposite way. Uber has a huge most that Eats adds almost nothing to. Every day millions of people reach into their pockets to request a ride using the Uber app. Competing with Uber means a) recruit large numbers of drivers so your app has rides to offer. b) convincing large numbers of people to download your app. c) convincing them to make your app their primary ride share choice. Even tackling a small city would be horrendously expensive. If it truly was easy Uber would be getting eaten alive by numerous small startups in every major city they operate in.

WorkLifeBalance 8y ago

Does this work in jurisdictions such as London where there are extra checks that drivers must pass? I can't imagine that a food delivery service could be competitive using drivers rated for safe person delivery. Is the driver fleet for Uber eats even the same as the minicab fleet or is it really just another business?