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Having new “one-time” charges every quarter means those are not one-time charges. They’re part of the business, which means the business doesn’t work. One of U

Having new “one-time” charges every quarter means those are not one-time charges. They’re part of the business, which means the business doesn’t work. One of Ubers biggest problems is that they have zero brand loyalty. For a company that sells a utility (get me, or my food, from A to B) rather than an experience (like a cool vacation in a unique mansion), I will always pick the cheapest option. Whether that’s Uber or Bobs Taxis it doesn’t matter. That means this whole business is a race to the bottom. Profits will stabilize at approximately zero for everyone in that business. The second huge problem is that nothing about providing this utility (neither the driving itself, nor the human labor required of the driver) has decreased since Uber came into existence. Driving a car from A to B still costs the same per mile (gas or electricity and wear and tear), and the driver still costs the same per hour (at least minimum wage). Uber has only made finding the ride more efficient but it has not made the actual ride itself more efficient. So in the best case, Uber can be as profitable as a taxi company. But ONLY if it raises its prices to taxi company levels. And then it’s a taxi company. Taxis are expensive for a reason, because without a VC subsidy they have to be profitable to exist. And what if there are robot drivers? Wouldn’t that eliminate at least the human cost? It would. But it would do so for every other transport company as well, and by the same amount. Since there is no customer loyalty for a transport like this, Uber would still be fighting the same competitors in a similar race to the bottom. In summary, nothing can save Uber.

MuffinFlavored 7y ago
> I will always pick the cheapest option. My friend's sister got hospitalized after her Uber driver ran a red light because they were not privy to traffic queues most normal people would have caught on to (like stopping when a light is turning red) I will gladly spend a couple extra bucks the ~20 times I need to Uber a year so that I am not getting into a screaming metal death trap with an unfit driver.
- deleted 7y ago
  [deleted]
- 1123581321 7y ago
  It’s not clear what you are spending extra money on or how you are evaluating driver aptitude. What about Uber’s driver requirements doesn’t work for you?
  - MuffinFlavored 7y ago
    I wouldn't feel comfortable knowing Uber cut driver wages to beyond razor thin because I'd question if the driver (who is willing to work for next to nothing) is qualified to safely drive me around.
ENOTTY 7y ago
They do have a loyalty program now, which is designed to drive brand loyalty. Whether it actually works is up to the market.
- ganitarashid 7y ago
  A low price is not loyalty
  - seltzered_ 7y ago
    I believe the person is referring to ‘uber cash’ as an loyalty incentive, paired with changes to the uber credit card coming next year which will only give uber cash (akin to airline miles).
  - DuskStar 7y ago
    Uber Rewards [0] is, though. Basically airline status. 0: https://www.uber.com/us/en/u/rewards/ https://www.uber.com/us/en/u/rewards/
- angstrom 7y ago
  I'm in the NYC market. I use Lyft to get around and Uber Eats to order things that could never have a business model delivering to me. To me market capture is just as bad as the original Taxi model, but even Taxis have gotten around to handling this problem. You can switch to the app in the middle of a ride and pay with the code on the back seat tv screen. The convenience factor is only there for food until another competitor enters that arena. It's a race to the bottom and I suspect after all the hard work is said and done Uber will be the Yahoo of ride share. Tesla may very well swoop in and say "Thanks for blazing the trail"
kbenson 7y ago
The only way Uber works as a service is if you leverage all the people that want to be a taxi driver for a few minutes, so are will g to take less than a living wage because it's extra income that they trade time (and a vehicle) that they weren't utilizing much already during that time, which allows rates lower than taxis. The only way Uber works as an investment (at the level they've accepted money) is if they somehow kill off traditional taxis and all competition and become the only game in town (where "town" is basically the whole U.S.), and charge taxi rates or above. Given that the cost of entry I to the market (at least for customers willing to see the cheaper rates) is essentially zero as by the nature of the business your drivers can drive for anyone, making Uber work as an investment doesn't look very likely to me. Not that I'll feel all that bad when those people lose money. I'll just call that karmic justice for investing in a company with such a horrible record (I believe if Uber didn't have billions invested by the elite they would have been shut down or heavily regulated for bad business practices years ago).
duud 7y ago
I disagree that they have zero brand loyalty. Yes it is a price sensitive industry but you're doing something right when your brand becomes a verb. I'm in Melbourne, Australia and I generally pay the extra few dollars for Uber rather than dealing with Didi, Taxify et al's inferior interfaces and slower pick up times. I think Uber take 28% commission vs Didi's 15% and that is reflected in the pricing eg. a $25 Didi fare is usually $30ish on Uber.
- geolqued 7y ago
  Didi is 5% commission, massive difference to the driver. As an alternative Melbourne opinion, no way am I using Uber. Last ride I got the driver told me he only considers the premium jobs from uber and prefers Didi.
  - duud 7y ago
    Ya wow if looks like they dropped it late last year. I'll have to try it again as that's a significant discount.
cavisne 7y ago
At least for me uber has huge brand loyalty, it’s sitting in the dock of my iPhone. If I need to go somewhere, or get home, Uber has never let me down. Likewise with food delivery, I certainly have been let down on that but Uber does the best job of letting me track the order and get a refund if needed. Sure Lyft is an alternative, I have it on my phone but simply never use it. It’s incorrect that nothing has changed about the cost of a ride. Taxi medallions used to be 500k-1m and require essentially taking out a mortgage. Now they are worth effectively $0. And cost was never the core issue with Taxi’s, it was the unpredictability of the cost, having to pay in cash because the drivers incentive is to skim from the owner, having to find one or call for one, having to put your trust in a random driver in a random country with no idea if you are going the right way. Look to NYC where they seem to have set the goal of making Uber as expensive as possible (10s of dollars in random fees per ride). It’s still popular - in a city with some of the best taxi options.
- appleshore 7y ago
  I check my Uber, my girlfriend checks hers and Lyfts. There’s various promos so it’s changes. And now there’s Opoli but maybe only at LAX.
- greggman2 7y ago
  I switched to Lyft a few years ago because of Uber's evil ways. I've had zero problems. If people won't stop using a company that is so blatantly bad we're in trouble.
  - deleted 7y ago
    [deleted]
  - arcticbull 7y ago
    Frankly they're basically interchangeable. I'm not sure what you mean by a company "so blatantly bad" -- most of the drivers in SF at least drive for both Uber and Lyft. You can use either app and end up with the same driver, in the same car, offering the same exact experience at a practically indistinguishable price point. Uber at least seems to know people are mad at them and offer excellent customer service. Now, that doesn't mean they're a good business of course -- they're probably a terrible business -- but that's a reason to use them, not to avoid them. With that in mind, unit economics at both Uber and Lyft seem to be about the same, and both equally dreadful. Lyft never made some of the even worse investments (like trying to compete in mainland China without government support). Those days appear long behind Uber, though, for better or worse.
marcell 7y ago
People in tech industry have excessive bias against businesses with no network effects or other obscenely effective barriers to entry. There are lots of successful, large corporations with varying levels of barriers to entry. Exxon Mobil doesn't have a network effect and has zero brand loyalty, but it's still a huge business. McDonald's also lacks network effects, though it does have some brand loyalty, perhaps similar to Uber. Of course these businesses have some barriers to entry (so does Uber. Lyft et al. notwithstanding), but it's not a result of network effects that we're used to with companies like FB and eBay.
- AlexandrB 7y ago
  > There are lots of successful, large corporations with varying levels of barriers to entry. Of course! But they’re not valued at 10x revenue like tech companies. Uber stock has nowhere to go but down.
- puranjay 7y ago
  I think the tech industry has been infected by a monopoly mindset, that the only way to build a business is to be the only business in that space. It doesn't help that the most visible "successful" tech companies are all monopolies or duopolies (Google, Facebook, etc.) But for every category-dominating Microsoft, there are dozens of very successful software companies in every vertical. Dozens of project management software companies, countless task management software companies, etc.
- avocado4 7y ago
  > McDonald's also lacks network effects, though it does have some brand loyalty McDonald's is top 10 most valuable brand in the world. It has massive brand loyalty & defensibility through it.
- TheCoelacanth 7y ago
  Businesses without network effects or barriers to entry are fine, but they can't afford to burn billions in investor cash every quarter the way that Uber does. They are never going to have the out-sized profits to justify those initial losses.
gok 7y ago
Which one-time charges are we talking about? Neither the linked results nor the supplemental call any out.
trimbo 7y ago
> That means this whole business is a race to the bottom. Seems like that's why they started limiting hackney carriages and regulating rates in London in 1662. Also the horse had to be less than 14 hands high! https://www.british-history.ac.uk/statutes-realm/vol5/pp351-357#h3-0004 https://www.british-history.ac.uk/statutes-realm/vol5/pp351-...
dclusin 7y ago
I use Uber and don't have any inclination to switch because the price difference is negligible. I also Uber to the airport maybe 1-2 times a year. So it's rarely used and there's little benefit to switching. Why change?
- ganitarashid 7y ago
  It’s not that you want to switch. It’s that you wouldn’t care if you did.
  - dclusin 7y ago
    But I also have no desire to, since there isn't any difference.
henrikschroder 7y ago
> Uber has only made finding the ride more efficient but it has not made the actual ride itself more efficient. Back when Uber was new and everyone in SF was exclaiming how awesome it was and disruptive, one of the major taxi companies in Stockholm launched a new version of their app that basically had a big button going "I want a taxi to my location now", and you pressed it, and you got a "Hey, your taxi will arrive in X minutes". And that's like the entire value of Uber right there, replicated cheaply by local competition.
- mikemotherwell 7y ago
  There are way more positives than that: # No money changes hands, so safer for drivers. # No payment is made in the vehicle, so faster exit times. # Uber records all trips, so easier to work out costs to expense. # Uber uses any credit card, so your boss can pay for your ride without the need for separate expensing. # Driver and passenger are tracked, so there it is easy to find who did what. There are a lot of rape charges and cases against Cabbies. # Rating - I've been in a LOT of awful, awful cabs. # Drivers can work 1 hour and make some money. Try that with any other job.
  - ganitarashid 7y ago
    Those are all great things. And all of them are done by the competitors. In Europe I use MyTaxi, same thing as Uber but much nicer cars
    - mikemotherwell 7y ago
      Could not agree more. There are lots of things, easily copied, that make the Uber app great, not just the ride. The question longer terms becomes who continues to get rides, and why? IMHO, ubiquity, especially when traveling, will ultimately be the winning move.
      - sah2ed 7y ago
        > IMHO, ubiquity, especially when traveling, will ultimately be the winning move. Many of Uber’s customers are price sensitive. The minority who are not price sensitive are more likely to (be able to afford frequent) travel, but I fail to see how loyalty from this segment will translate into profits over the long term, especially since their international presence in multiple but not homogenous markets is a bet that economies of scale will yield a handsome pay off, where it clearly hasn’t as they had to pull out from direct competition in China for instance.
ngoel36 7y ago
> Uber has only made finding the ride more efficient but it has not made the actual ride itself more efficient. Driver cost per trip = Driver cost per hour / Driver utilization. By making finding the ride more efficient, Uber meaningfully increases driver utilization, decreasing driver cost per trip.
- ganitarashid 7y ago
  Apparently the decrease hasn’t been enough to have a positive impact on Uber financials
- mepiethree 7y ago
  Drivers arent paid per hour though
pbreit 7y ago
Much of your post is wrong. Would need to evaluate the one-time charges to determine if they actually would be ongoing. Simply having some one-time charges doesn't mean they will necessarily be perpetual. In fact, the vast majority of riders have a preferred option even without the frequent rider incentives. This is even starker on the driver side. The advent of pooling and continuing improvement absolutely have had a significant impact on the economics. Uber has delivered various efficiency improvements including map-based routing and pricing, pooling. Lyft has "Shared Savers" that trade time/walking for lower fares and more efficient pickups/drop-ffs. In fact, Uber & Lyft are frequently more expensive than taxis because of surge pricing and superior product. Uber & Lyft are in the best position to take advantage of robo-drivers.
- ganitarashid 7y ago
  Once we have robo drivers everyone will have them. If Uber survives until that day, it will have no advantage over a localized competitor like Bobs Taxis with robo drivers.
- onion2k 7y ago
  Uber & Lyft are in the best position to take advantage of robo-drivers. I don't think they are. The cost savings on using driveless cars for taxis are huge. Any operator will be able to massively undercut the competition. Consequently the most sensible thing for whichever company gets a level 5 driverless car first would be to run their own ride company and not sell or license the tech to anyone else. That's what Waymo is all about and why Uber are trying to invent their own driverless tech. Any brand loyalty will evaporate literally overnight as soon as someone launches a driverless ride service simply because it'll be half the price of all the other human-operated services, far more reliable (no more cancellations for a better fare), and probably have many more cars available 24/7.
  - b3kart 7y ago
    > (no more cancellations for a better fare) Wouldn’t be so sure about that. The operating company will still be trying to maximise profits after all.
sytelus 7y ago
Experience matters - a lot! Recently I got new phone and it was bit of an adventure just to login to Uber. After that I'd to add CC numbers manually. For Lyft it was simply taking a photo. There are several other small things, for example, I want tips to be included in single charge for easier receipts for business trips. I want review to be annonymous. I want app to ask me landmark if it detects poor GPS in places like NYC. I want some sort of negative reward for driver if they cancel on me. In my trip to India I learned that there was 50% chance drivers would cancel on you in Ola and 20% in Uber. All these are complex issues and neither Uber or Lyft has solved it perfectly. My money will go to company which provides greatest experience, not the 10% difference in price. Both companies are doing right thing to invest heavily in new businesses + experiences + new markets - despite what pundits say around here and that wall street wants to suck out all growth for short term "shareholder value maximization".
pif 7y ago
> For a company that sells a utility (...) rather than an experience (...), I will always pick the cheapest option. That's exactly how they built their business. They should not be surprised of the consequences!
kmlx 7y ago
"I will always pick the cheapest option... That means this whole business is a race to the bottom." wow. how many trips do you do?
- jaysh 7y ago
  Not OP, but in the same boat, and currently travel regularly. I always almost all of them installed (e.g. Uber/Lyft/Ola/Bolt/Grab etc.) and pick the cheapest. For now, there's the added incentive that you never pay full-fare for your first ride, too, so new competition is great.
code4tee 7y ago
The first time I got in an Uber and saw two other phones on the dashboard with the driver working Lyft and another competitor at the same time I knew it was game over for these companies. Both the drivers and the riders were taking the best deal each ride and the VCs were in the middle subsidizing the whole thing for both sides. It’s a race to the bottom. I enjoy the product and will enjoy the cheap rides while they last but the business mode seems flawed.
SergeAx 7y ago
Uber is actually marketplace and it's goal is to balance demand and supply. Great upsides of being big company, e.g. having more cars and drivers, is 1) less waiting time for passenger and 2) less empty mileage for drivers/cars. First is good catch for client (I will not wait extra 10 minutes for Bobs Taxis even with 5% price difference), second is a no-brainer for drivers (one got paid for more hours ber day). Actually second one is a good edge against any local Bobs Taxis: with less idle time bigger company pays minimal wage faster and can make overall prices better.
V-2 7y ago
> One of Ubers biggest problems is that they have zero brand loyalty. It may not warrant as much customer loyalty as - say - Apple, but "zero" is simply untrue. To give a most ovious example, in a foreign country/city I'd be strongly inclined to choose Uber over other alternatives because I'm already familiar with it. For the same reason why I'd eat at McDonald's (rather than some local hot-dog stand): not quality, but safety. I see the risk that I get scammed / food-poisoned as lower. > Uber has only made finding the ride more efficient but it has not made the actual ride itself more efficient. It has, to some extent: in the form of shared rides. Traditional taxi companies don't provide such option, for fairly obvious reasons. > And what if there are robot drivers? Wouldn’t that eliminate at least the human cost? It would. But it would do so for every other transport company as well, and by the same amount. Not if you've got your own IP behind it - whereas your competitors need to rely on third-party solutions - or even if you can get a better deal on a third-party solution. > Uber would still be fighting the same competitors in a similar race to the bottom. In summary, nothing can save Uber. The exact same case could be made for Burger King. It's quite possible that nothing can save Uber, it's clearly struggling, but I don't think your reasoning correctly sums up actual causes of that.
- jaysh 7y ago
  Landed in Sydney a few weeks ago. First visit so I ordered an Uber (as I've used it a lot, trust it, etc.). After we were picked up, the driver helpfully informed us if we'd ordered the same ride via Ola (he drives both), it'd have been ~50% cheaper (as a new user). Naturally, I installed it and now I'll switch between Uber and m Ola. This then expands to Bolt, Grab, and so on, and you realise it's virtually the same experience with different branding and the sole differentiating factor is price. I definitely buy the convenience aspect: it's way more comfortable to pull out your phone and order a ride on a platform you're already familiar with. My trouble is the barrier is so low to install another app (and new joiner incentives are financially motivating) that this leads to virtually no brand loyalty. Perhaps in a different world, where there are no up significant upfront financial incentives and perhaps drivers were exclusive to a platform (i.e. to pass their rigorous screening processes is a sign of quality), that'd certainly buy some loyalty from me.
iamgopal 7y ago
Profitable business are the one when one can not add Further value to it. i.e. advertise. Or retail trading like business.
not_a_cop75 7y ago
I really hate Uber, but you're partly wrong. Brand loyalty works when there isn't a competing brand of similar quality. So Uber at worst will always be second choice. Driving is getting cheaper as better cars are built, but they have to work against inflation, which is not real value, but you'll measure that anyway. Lastly, Uber can limit their fleet to efficient cars and effective drivers if they want. This should limit costs, but I think this happens almost naturally without them doing too much.
jpalomaki 7y ago
Might be different in other markets, but in my home city picking the best (price, time) ride is not so easy. The time it takes for the car to arrive varies a lot. In all the services available I need to first place the order, then they find the car and after that I get estimate how long it takes to arrive. I can cancel and try another one, but that’s quite inconvenient. Also the time estimates seem to be fairly optimistic. At least on my case this means that I’m not always trying to pick the cheapest option, but instead go with the option that has had good price/performance ratio in the past.

MuffinFlavored 7y ago

> I will always pick the cheapest option. My friend's sister got hospitalized after her Uber driver ran a red light because they were not privy to traffic queues most normal people would have caught on to (like stopping when a light is turning red) I will gladly spend a couple extra bucks the ~20 times I need to Uber a year so that I am not getting into a screaming metal death trap with an unfit driver.

deleted 7y ago
[deleted]
1123581321 7y ago
It’s not clear what you are spending extra money on or how you are evaluating driver aptitude. What about Uber’s driver requirements doesn’t work for you?
- MuffinFlavored 7y ago
  I wouldn't feel comfortable knowing Uber cut driver wages to beyond razor thin because I'd question if the driver (who is willing to work for next to nothing) is qualified to safely drive me around.

ENOTTY 7y ago

They do have a loyalty program now, which is designed to drive brand loyalty. Whether it actually works is up to the market.

ganitarashid 7y ago
A low price is not loyalty
- seltzered_ 7y ago
  I believe the person is referring to ‘uber cash’ as an loyalty incentive, paired with changes to the uber credit card coming next year which will only give uber cash (akin to airline miles).
- DuskStar 7y ago
  Uber Rewards [0] is, though. Basically airline status. 0: https://www.uber.com/us/en/u/rewards/ https://www.uber.com/us/en/u/rewards/
angstrom 7y ago
I'm in the NYC market. I use Lyft to get around and Uber Eats to order things that could never have a business model delivering to me. To me market capture is just as bad as the original Taxi model, but even Taxis have gotten around to handling this problem. You can switch to the app in the middle of a ride and pay with the code on the back seat tv screen. The convenience factor is only there for food until another competitor enters that arena. It's a race to the bottom and I suspect after all the hard work is said and done Uber will be the Yahoo of ride share. Tesla may very well swoop in and say "Thanks for blazing the trail"

kbenson 7y ago

The only way Uber works as a service is if you leverage all the people that want to be a taxi driver for a few minutes, so are will g to take less than a living wage because it's extra income that they trade time (and a vehicle) that they weren't utilizing much already during that time, which allows rates lower than taxis. The only way Uber works as an investment (at the level they've accepted money) is if they somehow kill off traditional taxis and all competition and become the only game in town (where "town" is basically the whole U.S.), and charge taxi rates or above. Given that the cost of entry I to the market (at least for customers willing to see the cheaper rates) is essentially zero as by the nature of the business your drivers can drive for anyone, making Uber work as an investment doesn't look very likely to me. Not that I'll feel all that bad when those people lose money. I'll just call that karmic justice for investing in a company with such a horrible record (I believe if Uber didn't have billions invested by the elite they would have been shut down or heavily regulated for bad business practices years ago).

duud 7y ago

I disagree that they have zero brand loyalty. Yes it is a price sensitive industry but you're doing something right when your brand becomes a verb. I'm in Melbourne, Australia and I generally pay the extra few dollars for Uber rather than dealing with Didi, Taxify et al's inferior interfaces and slower pick up times. I think Uber take 28% commission vs Didi's 15% and that is reflected in the pricing eg. a $25 Didi fare is usually $30ish on Uber.

geolqued 7y ago
Didi is 5% commission, massive difference to the driver. As an alternative Melbourne opinion, no way am I using Uber. Last ride I got the driver told me he only considers the premium jobs from uber and prefers Didi.
- duud 7y ago
  Ya wow if looks like they dropped it late last year. I'll have to try it again as that's a significant discount.

cavisne 7y ago

At least for me uber has huge brand loyalty, it’s sitting in the dock of my iPhone. If I need to go somewhere, or get home, Uber has never let me down. Likewise with food delivery, I certainly have been let down on that but Uber does the best job of letting me track the order and get a refund if needed. Sure Lyft is an alternative, I have it on my phone but simply never use it. It’s incorrect that nothing has changed about the cost of a ride. Taxi medallions used to be 500k-1m and require essentially taking out a mortgage. Now they are worth effectively $0. And cost was never the core issue with Taxi’s, it was the unpredictability of the cost, having to pay in cash because the drivers incentive is to skim from the owner, having to find one or call for one, having to put your trust in a random driver in a random country with no idea if you are going the right way. Look to NYC where they seem to have set the goal of making Uber as expensive as possible (10s of dollars in random fees per ride). It’s still popular - in a city with some of the best taxi options.

appleshore 7y ago
I check my Uber, my girlfriend checks hers and Lyfts. There’s various promos so it’s changes. And now there’s Opoli but maybe only at LAX.
greggman2 7y ago
I switched to Lyft a few years ago because of Uber's evil ways. I've had zero problems. If people won't stop using a company that is so blatantly bad we're in trouble.
- deleted 7y ago
  [deleted]
- arcticbull 7y ago
  Frankly they're basically interchangeable. I'm not sure what you mean by a company "so blatantly bad" -- most of the drivers in SF at least drive for both Uber and Lyft. You can use either app and end up with the same driver, in the same car, offering the same exact experience at a practically indistinguishable price point. Uber at least seems to know people are mad at them and offer excellent customer service. Now, that doesn't mean they're a good business of course -- they're probably a terrible business -- but that's a reason to use them, not to avoid them. With that in mind, unit economics at both Uber and Lyft seem to be about the same, and both equally dreadful. Lyft never made some of the even worse investments (like trying to compete in mainland China without government support). Those days appear long behind Uber, though, for better or worse.

marcell 7y ago

People in tech industry have excessive bias against businesses with no network effects or other obscenely effective barriers to entry. There are lots of successful, large corporations with varying levels of barriers to entry. Exxon Mobil doesn't have a network effect and has zero brand loyalty, but it's still a huge business. McDonald's also lacks network effects, though it does have some brand loyalty, perhaps similar to Uber. Of course these businesses have some barriers to entry (so does Uber. Lyft et al. notwithstanding), but it's not a result of network effects that we're used to with companies like FB and eBay.

AlexandrB 7y ago
> There are lots of successful, large corporations with varying levels of barriers to entry. Of course! But they’re not valued at 10x revenue like tech companies. Uber stock has nowhere to go but down.
puranjay 7y ago
I think the tech industry has been infected by a monopoly mindset, that the only way to build a business is to be the only business in that space. It doesn't help that the most visible "successful" tech companies are all monopolies or duopolies (Google, Facebook, etc.) But for every category-dominating Microsoft, there are dozens of very successful software companies in every vertical. Dozens of project management software companies, countless task management software companies, etc.
avocado4 7y ago
> McDonald's also lacks network effects, though it does have some brand loyalty McDonald's is top 10 most valuable brand in the world. It has massive brand loyalty & defensibility through it.
TheCoelacanth 7y ago
Businesses without network effects or barriers to entry are fine, but they can't afford to burn billions in investor cash every quarter the way that Uber does. They are never going to have the out-sized profits to justify those initial losses.

gok 7y ago

Which one-time charges are we talking about? Neither the linked results nor the supplemental call any out.

trimbo 7y ago

> That means this whole business is a race to the bottom. Seems like that's why they started limiting hackney carriages and regulating rates in London in 1662. Also the horse had to be less than 14 hands high! https://www.british-history.ac.uk/statutes-realm/vol5/pp351-357#h3-0004 https://www.british-history.ac.uk/statutes-realm/vol5/pp351-...

dclusin 7y ago

I use Uber and don't have any inclination to switch because the price difference is negligible. I also Uber to the airport maybe 1-2 times a year. So it's rarely used and there's little benefit to switching. Why change?

ganitarashid 7y ago
It’s not that you want to switch. It’s that you wouldn’t care if you did.
- dclusin 7y ago
  But I also have no desire to, since there isn't any difference.

henrikschroder 7y ago

> Uber has only made finding the ride more efficient but it has not made the actual ride itself more efficient. Back when Uber was new and everyone in SF was exclaiming how awesome it was and disruptive, one of the major taxi companies in Stockholm launched a new version of their app that basically had a big button going "I want a taxi to my location now", and you pressed it, and you got a "Hey, your taxi will arrive in X minutes". And that's like the entire value of Uber right there, replicated cheaply by local competition.

mikemotherwell 7y ago
There are way more positives than that: # No money changes hands, so safer for drivers. # No payment is made in the vehicle, so faster exit times. # Uber records all trips, so easier to work out costs to expense. # Uber uses any credit card, so your boss can pay for your ride without the need for separate expensing. # Driver and passenger are tracked, so there it is easy to find who did what. There are a lot of rape charges and cases against Cabbies. # Rating - I've been in a LOT of awful, awful cabs. # Drivers can work 1 hour and make some money. Try that with any other job.
- ganitarashid 7y ago
  Those are all great things. And all of them are done by the competitors. In Europe I use MyTaxi, same thing as Uber but much nicer cars
  - mikemotherwell 7y ago
    Could not agree more. There are lots of things, easily copied, that make the Uber app great, not just the ride. The question longer terms becomes who continues to get rides, and why? IMHO, ubiquity, especially when traveling, will ultimately be the winning move.
    - sah2ed 7y ago
      > IMHO, ubiquity, especially when traveling, will ultimately be the winning move. Many of Uber’s customers are price sensitive. The minority who are not price sensitive are more likely to (be able to afford frequent) travel, but I fail to see how loyalty from this segment will translate into profits over the long term, especially since their international presence in multiple but not homogenous markets is a bet that economies of scale will yield a handsome pay off, where it clearly hasn’t as they had to pull out from direct competition in China for instance.

ngoel36 7y ago

> Uber has only made finding the ride more efficient but it has not made the actual ride itself more efficient. Driver cost per trip = Driver cost per hour / Driver utilization. By making finding the ride more efficient, Uber meaningfully increases driver utilization, decreasing driver cost per trip.

ganitarashid 7y ago
Apparently the decrease hasn’t been enough to have a positive impact on Uber financials
mepiethree 7y ago
Drivers arent paid per hour though

pbreit 7y ago

Much of your post is wrong. Would need to evaluate the one-time charges to determine if they actually would be ongoing. Simply having some one-time charges doesn't mean they will necessarily be perpetual. In fact, the vast majority of riders have a preferred option even without the frequent rider incentives. This is even starker on the driver side. The advent of pooling and continuing improvement absolutely have had a significant impact on the economics. Uber has delivered various efficiency improvements including map-based routing and pricing, pooling. Lyft has "Shared Savers" that trade time/walking for lower fares and more efficient pickups/drop-ffs. In fact, Uber & Lyft are frequently more expensive than taxis because of surge pricing and superior product. Uber & Lyft are in the best position to take advantage of robo-drivers.

ganitarashid 7y ago
Once we have robo drivers everyone will have them. If Uber survives until that day, it will have no advantage over a localized competitor like Bobs Taxis with robo drivers.
onion2k 7y ago
Uber & Lyft are in the best position to take advantage of robo-drivers. I don't think they are. The cost savings on using driveless cars for taxis are huge. Any operator will be able to massively undercut the competition. Consequently the most sensible thing for whichever company gets a level 5 driverless car first would be to run their own ride company and not sell or license the tech to anyone else. That's what Waymo is all about and why Uber are trying to invent their own driverless tech. Any brand loyalty will evaporate literally overnight as soon as someone launches a driverless ride service simply because it'll be half the price of all the other human-operated services, far more reliable (no more cancellations for a better fare), and probably have many more cars available 24/7.
- b3kart 7y ago
  > (no more cancellations for a better fare) Wouldn’t be so sure about that. The operating company will still be trying to maximise profits after all.

sytelus 7y ago

Experience matters - a lot! Recently I got new phone and it was bit of an adventure just to login to Uber. After that I'd to add CC numbers manually. For Lyft it was simply taking a photo. There are several other small things, for example, I want tips to be included in single charge for easier receipts for business trips. I want review to be annonymous. I want app to ask me landmark if it detects poor GPS in places like NYC. I want some sort of negative reward for driver if they cancel on me. In my trip to India I learned that there was 50% chance drivers would cancel on you in Ola and 20% in Uber. All these are complex issues and neither Uber or Lyft has solved it perfectly. My money will go to company which provides greatest experience, not the 10% difference in price. Both companies are doing right thing to invest heavily in new businesses + experiences + new markets - despite what pundits say around here and that wall street wants to suck out all growth for short term "shareholder value maximization".

pif 7y ago

> For a company that sells a utility (...) rather than an experience (...), I will always pick the cheapest option. That's exactly how they built their business. They should not be surprised of the consequences!

kmlx 7y ago

"I will always pick the cheapest option... That means this whole business is a race to the bottom." wow. how many trips do you do?

jaysh 7y ago
Not OP, but in the same boat, and currently travel regularly. I always almost all of them installed (e.g. Uber/Lyft/Ola/Bolt/Grab etc.) and pick the cheapest. For now, there's the added incentive that you never pay full-fare for your first ride, too, so new competition is great.

code4tee 7y ago

The first time I got in an Uber and saw two other phones on the dashboard with the driver working Lyft and another competitor at the same time I knew it was game over for these companies. Both the drivers and the riders were taking the best deal each ride and the VCs were in the middle subsidizing the whole thing for both sides. It’s a race to the bottom. I enjoy the product and will enjoy the cheap rides while they last but the business mode seems flawed.

SergeAx 7y ago

Uber is actually marketplace and it's goal is to balance demand and supply. Great upsides of being big company, e.g. having more cars and drivers, is 1) less waiting time for passenger and 2) less empty mileage for drivers/cars. First is good catch for client (I will not wait extra 10 minutes for Bobs Taxis even with 5% price difference), second is a no-brainer for drivers (one got paid for more hours ber day). Actually second one is a good edge against any local Bobs Taxis: with less idle time bigger company pays minimal wage faster and can make overall prices better.

V-2 7y ago

> One of Ubers biggest problems is that they have zero brand loyalty. It may not warrant as much customer loyalty as - say - Apple, but "zero" is simply untrue. To give a most ovious example, in a foreign country/city I'd be strongly inclined to choose Uber over other alternatives because I'm already familiar with it. For the same reason why I'd eat at McDonald's (rather than some local hot-dog stand): not quality, but safety. I see the risk that I get scammed / food-poisoned as lower. > Uber has only made finding the ride more efficient but it has not made the actual ride itself more efficient. It has, to some extent: in the form of shared rides. Traditional taxi companies don't provide such option, for fairly obvious reasons. > And what if there are robot drivers? Wouldn’t that eliminate at least the human cost? It would. But it would do so for every other transport company as well, and by the same amount. Not if you've got your own IP behind it - whereas your competitors need to rely on third-party solutions - or even if you can get a better deal on a third-party solution. > Uber would still be fighting the same competitors in a similar race to the bottom. In summary, nothing can save Uber. The exact same case could be made for Burger King. It's quite possible that nothing can save Uber, it's clearly struggling, but I don't think your reasoning correctly sums up actual causes of that.

jaysh 7y ago
Landed in Sydney a few weeks ago. First visit so I ordered an Uber (as I've used it a lot, trust it, etc.). After we were picked up, the driver helpfully informed us if we'd ordered the same ride via Ola (he drives both), it'd have been ~50% cheaper (as a new user). Naturally, I installed it and now I'll switch between Uber and m Ola. This then expands to Bolt, Grab, and so on, and you realise it's virtually the same experience with different branding and the sole differentiating factor is price. I definitely buy the convenience aspect: it's way more comfortable to pull out your phone and order a ride on a platform you're already familiar with. My trouble is the barrier is so low to install another app (and new joiner incentives are financially motivating) that this leads to virtually no brand loyalty. Perhaps in a different world, where there are no up significant upfront financial incentives and perhaps drivers were exclusive to a platform (i.e. to pass their rigorous screening processes is a sign of quality), that'd certainly buy some loyalty from me.

iamgopal 7y ago

Profitable business are the one when one can not add Further value to it. i.e. advertise. Or retail trading like business.

not_a_cop75 7y ago

I really hate Uber, but you're partly wrong. Brand loyalty works when there isn't a competing brand of similar quality. So Uber at worst will always be second choice. Driving is getting cheaper as better cars are built, but they have to work against inflation, which is not real value, but you'll measure that anyway. Lastly, Uber can limit their fleet to efficient cars and effective drivers if they want. This should limit costs, but I think this happens almost naturally without them doing too much.

jpalomaki 7y ago

Might be different in other markets, but in my home city picking the best (price, time) ride is not so easy. The time it takes for the car to arrive varies a lot. In all the services available I need to first place the order, then they find the car and after that I get estimate how long it takes to arrive. I can cancel and try another one, but that’s quite inconvenient. Also the time estimates seem to be fairly optimistic. At least on my case this means that I’m not always trying to pick the cheapest option, but instead go with the option that has had good price/performance ratio in the past.