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I can only see them making money in three ways : - They scale up massively and capture a huge fraction of the ride sharing market, thus allowing them to offer

by govg 7y ago

I can only see them making money in three ways : - They scale up massively and capture a huge fraction of the ride sharing market, thus allowing them to offer low cost / low margin rides, but making up for it by volumes : At least in India, they are in a good position, but they seem to have conceded the other markets with high potential for growth like SE Asia and China. - They have a premium offering that is actually quite a trend-setter : Revive the Uber Black service and take it up a notch, target richer clientele which will be willing to pay a premium to ride in a much better car and with trained chauffeurs. - They push heavily in the pooling space - this allows them to use their vehicular inventory better as well as drive up margins per ride : This doesn't seem to be a huge focus for them as of now, but it could change. The other big change that could transform their fortunes is if they put out a viable self driving product. I do not think it'll be economically profitable, or even technologically viable in the near term.

dcolkitt 7y ago
Option 4: Uber uses the expertise, infrastructure, and brand it built in ridesharing to expand into the becoming the de facto standard for timely last mile delivery. This is why UberEats is such a major strategic focus for the company. It's proof of concept that they can do more than be a taxi. An efficient platform for quickly and cheaply ferrying around stuff around town is a way bigger market than ridesharing. We're not only talking about the obvious examples like residential packages, groceries, and laundry. But entirely new business models that didn't previously exist, because there's no efficient last-mile delivery solution. Cloud kitchen are an example of a nascent industry that could only emerge in a post-Uber world.
- idlewords 7y ago
  Saying that we're going to work to dominate a low-margin sector at a staggering loss for years, so that we can enter an even lower-margin established industry and recoup our losses there, is a gutsy proposition.
  - dcolkitt 7y ago
    Sure is. But remember, that playbook's almost exactly how Amazon became the largest company in the world.
    - quickben 7y ago
      AWS lock-in is different from a taxi app. Only a few players so far managed to respond to AWS in scale and offerings. Lots of taxi companies have their own apps at this point.
      - joncrane 7y ago
        The comment you're replying to means the original Amazon business model of selling things online. Pretty sure AWS was profitable almost from day 1.
    - xtian 7y ago
      You’re saying cloud services is lower margin than retail? I don’t think that has ever been true.
    - TheCoelacanth 7y ago
      Except that Amazon didn't have remotely close to the level of losses that Uber has. The year Amazon went public, they lost $30 million. Uber is losing a billion a quarter.
      - idlewords 7y ago
        Not only that, but there's no Uber analogue to Amazon Web Services, which makes the analogy specious.
    - acdha 7y ago
      Amazon was making real profits in each line of business shortly after entering - 1-2 years for books, music, etc. IIRC. They chose to reinvest that in further expansion but always had the option of halting expansion and being fully profitable if they wanted. Uber has nothing remotely like that and, unlike Amazon, their costs scale linearly and their workers (who are most of the business) have no reason to be loyal.
- bduerst 7y ago
  Expanding on this Option 4: They become an auction platform for last mile deliveries. - Demand comes from third party apps through API, or SMBs that are looking to make a same-day delivery. Higher delivery bids means network is more likely to fulfill sooner. - Uber fulfills supply with their own network of drivers but also allows other regional rideshare networks to plug in. - Reputation is keyed to driver's license, and better reputation means preferred bids and/or a better cut of the delivery fee, scaling at a ratio to cover the risk of bad/unknown drivers. - Self driving cars become a reality, and the network allows autonomous delivery swarms to plug in and fulfill supply.
  - vinayakkulkarni 7y ago
    Become another locus.sh
- hi5eyes 7y ago
  option 4 is closer to the full scope of the company. uber has positioned to be more than simply a taxi company and a strong logistics competitor
- bluGill 7y ago
  Courier services have existed for years for last mile. I have a friend who was (20 years ago) paid full time by one law office to get papers to/from the court room (he worked for a company that dedicated him to that job). Part of his job was knowing the proper way to walk into a trial in progress. My dad more than once hired a taxi to take a package to the airport. I suspect post 9-11 this isn't legally allowed, but back then if you needed to get a bug fix to a customer your fastest option was put it on a tape, put the tape in a suitcase, buy a plane ticket for "Mr Package", and then check the suitcase in the name of Mr Package.
  - duxup 7y ago
    >My dad more than once hired a taxi to take a package to the airport. I suspect post 9-11 this isn't legally allowed, but back then if you needed to get a bug fix to a customer your fastest option was put it on a tape, put the tape in a suitcase, buy a plane ticket for "Mr Package", and then check the suitcase in the name of Mr Package I worked for a company where we would hire a courier to fly with the package when needed. We sent a few tapes that way, but also some important equipment when it was critical to a customer. It was by far the fastest and best way to be sure a dude would be at the office door in X minutes, on the plane in Y, and at the customer site in Z with the needed thing(s). It was expensive, but they were really reliable and professional.
  - hyperbovine 7y ago
    I don’t think the “Mr Package” option has been available for a very long time, well before 9/11. I vividly remember in the 1990s being delayed for an hour at the gate while they dug around the cargo hold in search of somebody’s checked bag who didn’t show up to board the flight.
- seppin 7y ago
  > for timely last mile delivery perhaps the only industry with worse margins than ride-hailing.
- __jal 7y ago
  > that could only emerge in a post-Uber world. Maybe, but a lot of restaurants despise Ubereats and want it to die, so they can't count on goodwill or loyalty there. (This is second-hand from a couple local restaurant owners; I am not one.) As I understand it, Uber is playing a sort of TicketMaster-ish game, demanding exclusivity (no having your own drivers, no using competitors) and funny terms about hosting your menu designed to make you dependent on them. I despise Uber, and when my local pizza shop was essentially forced to start using them, I started walking to pick up my greasepie. So I guess Uber is good for me, too.
  - remote_phone 7y ago
    >As I understand it, Uber is playing a sort of TicketMaster-ish game, demanding exclusivity (no having your own drivers, no using competitors) and funny terms about hosting your menu designed to make you dependent on them. This is false.
    - __jal 7y ago
      I'm really curious about this. I've known one of the people I talked to a long time, and while I don't audit his business, I believe him when he says the contract says he can't hire his own drivers. What, exactly, is false?
      - deleted 7y ago
        [deleted]
      - mike00632 7y ago
        In my neighborhood I know of multiple restaurants that are on UberEats, Postmates and Amazon Restaurants. For example, Pick Up Stix has their own delivery service and they're on UberEats.
massung 7y ago
Option 4: sell your ride data to a 3rd party. Knowing who you are, where you travel to, what's around those areas. They - or a 3rd party - could advertise what's in the area you were taken to, track where you frequent and recommend riding to places you haven't been to in a while showing you what's "new" in those areas, etc. I don't Uber (and have only used Lyft once), so maybe they already do this or are planning to.
- hannasanarion 7y ago
  I can't imagine there's that much data to sell. I don't think a lot of people use uber on a daily basis, the takeaways are gonna be "people travel to and from airports close to them".
  - lalos 7y ago
    They can deduce a lot and not to mention Foursquare profits on selling check-in info to fin companies. Also, check this blog from Uber http://www.whosdrivingyou.org/blog/ubers-deleted-rides-of-glory-blog-post http://www.whosdrivingyou.org/blog/ubers-deleted-rides-of-gl... where they (with some confidence) deduce when someone was involved in one night stand. Not to mention they have valuable information about you on how sensitive you are to price changes, who you interact with (sharing rides), what places you frequent (bars, gyms, churches, etc), places you travel and on what season. It's a goldmine and more by cross-referencing with other data sets. They can even know when you are sick if you get an Uber to the doctor or if you are friendly or not (drivers also review you) and how strict you are with other people (your reviews of drivers). It's all about the meta-data.
    - smelendez 7y ago
      Is that data worth enough to subsidize taxi rides, though? And again, they only have that comprehensive level of data for heavy users. Lots of people only use Uber when they're going to the airport, as others said, or maybe when they plan on drinking. I use it when I'm running late or public transit is messed up so it's very skewed data for me. There's also a real risk that Congress or the states could ban them from selling that data.
mywittyname 7y ago
Pools are where the money is at, IMHO. If they can put together a good predictive transportation model, then I think they will really have a killer app. Personal transportation is just too costly for regular use. But having an "Uber Bus" that shows up down the street from your house right when you need it, then can bring you home right after work for maybe $5/day will have wide-spread appeal.
- charliebossy 7y ago
  that's called public transit
  - reblis 7y ago
    And it's pretty terrible in some cities...especially in the United States
  - deleted 7y ago
    [deleted]

by govg 7y ago

dcolkitt 7y ago

Option 4: Uber uses the expertise, infrastructure, and brand it built in ridesharing to expand into the becoming the de facto standard for timely last mile delivery. This is why UberEats is such a major strategic focus for the company. It's proof of concept that they can do more than be a taxi. An efficient platform for quickly and cheaply ferrying around stuff around town is a way bigger market than ridesharing. We're not only talking about the obvious examples like residential packages, groceries, and laundry. But entirely new business models that didn't previously exist, because there's no efficient last-mile delivery solution. Cloud kitchen are an example of a nascent industry that could only emerge in a post-Uber world.

idlewords 7y ago
Saying that we're going to work to dominate a low-margin sector at a staggering loss for years, so that we can enter an even lower-margin established industry and recoup our losses there, is a gutsy proposition.
- dcolkitt 7y ago
  Sure is. But remember, that playbook's almost exactly how Amazon became the largest company in the world.
  - quickben 7y ago
    AWS lock-in is different from a taxi app. Only a few players so far managed to respond to AWS in scale and offerings. Lots of taxi companies have their own apps at this point.
    - joncrane 7y ago
      The comment you're replying to means the original Amazon business model of selling things online. Pretty sure AWS was profitable almost from day 1.
  - xtian 7y ago
    You’re saying cloud services is lower margin than retail? I don’t think that has ever been true.
  - TheCoelacanth 7y ago
    Except that Amazon didn't have remotely close to the level of losses that Uber has. The year Amazon went public, they lost $30 million. Uber is losing a billion a quarter.
    - idlewords 7y ago
      Not only that, but there's no Uber analogue to Amazon Web Services, which makes the analogy specious.
  - acdha 7y ago
    Amazon was making real profits in each line of business shortly after entering - 1-2 years for books, music, etc. IIRC. They chose to reinvest that in further expansion but always had the option of halting expansion and being fully profitable if they wanted. Uber has nothing remotely like that and, unlike Amazon, their costs scale linearly and their workers (who are most of the business) have no reason to be loyal.
bduerst 7y ago
Expanding on this Option 4: They become an auction platform for last mile deliveries. - Demand comes from third party apps through API, or SMBs that are looking to make a same-day delivery. Higher delivery bids means network is more likely to fulfill sooner. - Uber fulfills supply with their own network of drivers but also allows other regional rideshare networks to plug in. - Reputation is keyed to driver's license, and better reputation means preferred bids and/or a better cut of the delivery fee, scaling at a ratio to cover the risk of bad/unknown drivers. - Self driving cars become a reality, and the network allows autonomous delivery swarms to plug in and fulfill supply.
- vinayakkulkarni 7y ago
  Become another locus.sh
hi5eyes 7y ago
option 4 is closer to the full scope of the company. uber has positioned to be more than simply a taxi company and a strong logistics competitor
bluGill 7y ago
Courier services have existed for years for last mile. I have a friend who was (20 years ago) paid full time by one law office to get papers to/from the court room (he worked for a company that dedicated him to that job). Part of his job was knowing the proper way to walk into a trial in progress. My dad more than once hired a taxi to take a package to the airport. I suspect post 9-11 this isn't legally allowed, but back then if you needed to get a bug fix to a customer your fastest option was put it on a tape, put the tape in a suitcase, buy a plane ticket for "Mr Package", and then check the suitcase in the name of Mr Package.
- duxup 7y ago
  >My dad more than once hired a taxi to take a package to the airport. I suspect post 9-11 this isn't legally allowed, but back then if you needed to get a bug fix to a customer your fastest option was put it on a tape, put the tape in a suitcase, buy a plane ticket for "Mr Package", and then check the suitcase in the name of Mr Package I worked for a company where we would hire a courier to fly with the package when needed. We sent a few tapes that way, but also some important equipment when it was critical to a customer. It was by far the fastest and best way to be sure a dude would be at the office door in X minutes, on the plane in Y, and at the customer site in Z with the needed thing(s). It was expensive, but they were really reliable and professional.
- hyperbovine 7y ago
  I don’t think the “Mr Package” option has been available for a very long time, well before 9/11. I vividly remember in the 1990s being delayed for an hour at the gate while they dug around the cargo hold in search of somebody’s checked bag who didn’t show up to board the flight.
seppin 7y ago
> for timely last mile delivery perhaps the only industry with worse margins than ride-hailing.
__jal 7y ago
> that could only emerge in a post-Uber world. Maybe, but a lot of restaurants despise Ubereats and want it to die, so they can't count on goodwill or loyalty there. (This is second-hand from a couple local restaurant owners; I am not one.) As I understand it, Uber is playing a sort of TicketMaster-ish game, demanding exclusivity (no having your own drivers, no using competitors) and funny terms about hosting your menu designed to make you dependent on them. I despise Uber, and when my local pizza shop was essentially forced to start using them, I started walking to pick up my greasepie. So I guess Uber is good for me, too.
- remote_phone 7y ago
  >As I understand it, Uber is playing a sort of TicketMaster-ish game, demanding exclusivity (no having your own drivers, no using competitors) and funny terms about hosting your menu designed to make you dependent on them. This is false.
  - __jal 7y ago
    I'm really curious about this. I've known one of the people I talked to a long time, and while I don't audit his business, I believe him when he says the contract says he can't hire his own drivers. What, exactly, is false?
    - deleted 7y ago
      [deleted]
    - mike00632 7y ago
      In my neighborhood I know of multiple restaurants that are on UberEats, Postmates and Amazon Restaurants. For example, Pick Up Stix has their own delivery service and they're on UberEats.

massung 7y ago

Option 4: sell your ride data to a 3rd party. Knowing who you are, where you travel to, what's around those areas. They - or a 3rd party - could advertise what's in the area you were taken to, track where you frequent and recommend riding to places you haven't been to in a while showing you what's "new" in those areas, etc. I don't Uber (and have only used Lyft once), so maybe they already do this or are planning to.

hannasanarion 7y ago
I can't imagine there's that much data to sell. I don't think a lot of people use uber on a daily basis, the takeaways are gonna be "people travel to and from airports close to them".
- lalos 7y ago
  They can deduce a lot and not to mention Foursquare profits on selling check-in info to fin companies. Also, check this blog from Uber http://www.whosdrivingyou.org/blog/ubers-deleted-rides-of-glory-blog-post http://www.whosdrivingyou.org/blog/ubers-deleted-rides-of-gl... where they (with some confidence) deduce when someone was involved in one night stand. Not to mention they have valuable information about you on how sensitive you are to price changes, who you interact with (sharing rides), what places you frequent (bars, gyms, churches, etc), places you travel and on what season. It's a goldmine and more by cross-referencing with other data sets. They can even know when you are sick if you get an Uber to the doctor or if you are friendly or not (drivers also review you) and how strict you are with other people (your reviews of drivers). It's all about the meta-data.
  - smelendez 7y ago
    Is that data worth enough to subsidize taxi rides, though? And again, they only have that comprehensive level of data for heavy users. Lots of people only use Uber when they're going to the airport, as others said, or maybe when they plan on drinking. I use it when I'm running late or public transit is messed up so it's very skewed data for me. There's also a real risk that Congress or the states could ban them from selling that data.

mywittyname 7y ago

Pools are where the money is at, IMHO. If they can put together a good predictive transportation model, then I think they will really have a killer app. Personal transportation is just too costly for regular use. But having an "Uber Bus" that shows up down the street from your house right when you need it, then can bring you home right after work for maybe $5/day will have wide-spread appeal.

charliebossy 7y ago
that's called public transit
- reblis 7y ago
  And it's pretty terrible in some cities...especially in the United States
- deleted 7y ago
  [deleted]