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Looking at it from my consumer perspective Uber is net positive - even if it ends up being unsustainable and goes bust eventually. The prices in the local taxi

Looking at it from my consumer perspective Uber is net positive - even if it ends up being unsustainable and goes bust eventually. The prices in the local taxi market didn't go down a few % it got fractionally cheaper - it went from being barely affordable and only used in exceptional cases to a substitute for car ownership and not having to think about using it (depending on your daily commute). The market expanded incredibly around here. Also traveling around with Uber is a great experience (in countries that didn't ban it) - the service has been consistent across Europe and it's another thing I don't have to worry about when travelling - not having to navigate public transport or roads in a foreign country while also being relatively sure you're not getting ripped off by the local taxi service is amazing.

chefkoch 6y ago
> The prices in the local taxi market didn't go down a few % it got fractionally cheaper - it went from being barely affordable and only used in exceptional cases to a substitute for car ownership and not having to think about using it (depending on your daily commute). That's because they loose money with every ride? I mean it really can't be cheap to have your have your personal driver for your daily commute.
- rubber_duck 6y ago
  The thing is there are other taxi services locally that are competing with Uber at similar prices. Even if prices went up 30% it would still be in the "I don't have to think about it" territory.
  - chefkoch 6y ago
    I'm not sure how this is possible as afaik taxi fares are heavy regulated. Just because Uber subsedises rides no city council will change the taxi fares. https://www1.nyc.gov/site/tlc/passengers/taxi-fare.page https://www1.nyc.gov/site/tlc/passengers/taxi-fare.page
    - rubber_duck 6y ago
      Oh I should mention I'm in Europe and have no idea about how Uber works in the US.
    - andrewl-hn 6y ago
      "Taxi" taxis are not the only types of services like this. Depending on where in the world we're talking there have been other companies - often locally run or covering a few neighboring countries that use the same model Uber is using. Or offering similar ridesharing options via a phone since 1980s or 1990s. In my area (Eastern Europe) Uber matched the prices of other unofficial "taxi" services that existed for 40+ years. However, the convenience of having an app, not dealing with cash, ability to see your driver getting to meet you, etc. boosted the number of taxi riders tenfold. Many other ridesharing companies are offering apps these days, too. So even when Uber goes bust, the industry won't revert back to cash payments and phone numbers. So like the grandparent said it's a net positive for consumers.
    - KptMarchewa 6y ago
      Do you know NYC and SF are not the only places where people live?
      - chefkoch 6y ago
        Yeah, i'm from germany but most people here would have trouble reading german taxi regulation.
    - vidarh 6y ago
      A lot of places there is a sharp licensing distinction between requirements for those who want to be able to pick up unscheduled passengers on the street or taxi ranks, vs. those who only pick up on request or from their own locations. Overall the latter category tends to face far fewer limitations and be a lot more competitive.
- edouard-harris 6y ago
  They do not lose money with every ride, at least according to their most recent investor presentation [1]. Their rides segment is already profitable - albeit on an EBITDA basis, but with decent and growing margins. [1] https://s23.q4cdn.com/407969754/files/doc_financials/2019/sr/InvestorPresentation_2020_Feb13.pdf https://s23.q4cdn.com/407969754/files/doc_financials/2019/sr... (slide 15)
azernik 6y ago
Of course it's a net positive to consumers. It's a business being run at a loss, and propped up with constant capital inflow - i.e. a massive transfer of wealth from investors to consumers.
- rubber_duck 6y ago
  My point is that it's not just about operating on a loss - other companies locally are competing with Uber and amongst each other and the market that was once protected by shady licensing monopoly is now open wide - even a price increase of 20-30% will not change the way I use taxis right now - and that would be very sustainable (I don't see local uber as a loss generator with their pricing as the other taxi companies are able to compete - the marketing money Uber is sinking is probably what's generating the losses)
  - Traster 6y ago
    A price increase of 20-30% may not effect how you use taxis, but it will effect how lots of other people use taxis, and because loads less people will use taxis at 20% more they won't need to charge 20% more, they'll need to charge 20% + their decrease in utilization. Suddenly you're in a death spiral where they can't charge enough to make a living at any price.
    - rubber_duck 6y ago
      I doubt this. Initially when Uber arrived there was no regulation around here - the prices were ~30% lower and people driving Uber were actual part time drivers with clunky old cars - this was the ideal Uber time for me because in my smaller hometown I could get a ride almost instantly in any part of the city and I didn't care about ride quality if I didn't get dirty or smelt bad after I left the car. After taxi protests the government stepped in to basically enforce rules where part time driving became really hard - you have to have a car newer than 5 years, need to have some sort of work contract - not necessarily with Uber but a lot of forms of started small companies that then partner with Uber - but you no longer had limited taxi licenses - anyone can get a car and setup Uber. This resulted in prices eventually rising by 30-50% depending on the city, more importantly it resulted in lower availability in smaller places because it blocked small part time drivers. At this point local taxi companies are still complaining but there are now taxi services cheaper than uber depending on mileage. So in a way this Uber market transformation already happened. Like even at current prices an average taxi ride is 2-3x cheaper than it would be 10 years ago when it was basically a government granted cartel. And you were at the mercy of the driver randomly quoting you whatever he though you would pay in a lot of situations. Uber brought a lot of consistency and availability to the market.
TeMPOraL 6y ago
That's why you can't look at it just from your consumer perspective. The only thing necessary for the triumph of evil is to hide it from good men behind a layer of indirection. Another thing is: taxi innovation isn't either Uber or nothing. All these improvements Uber boasts about could have been achieved (many were achieved in some places) without tolerating illegal business practices by a thoroughly sociopathic international corporation. Maybe the progress would've been a bit slower, maybe there would be more competition on the market (which is usually considered a good thing). But it would be there, and done the way civilized people do things. And before someone replies, "but MLK was also doing illegal things!" - which is a response I see surprisingly often in Uber threads - let me remind everyone, that MLK was engaging in civil disobedience to fight for the common people and a just cause. Uber is a for-profit company with long and documented history of antisocial behavior, and one which only cares about dominating their market by dumping any and all externalities onto the society at large.
- roenxi 6y ago
  It is fine for consumers to look at things from a consumer's perspective. And it isn't controversial that Uber is offering the consumers a fantastic deal. The real question to me is do Uber's stockholders understand that they own the stock, or ar they indirectly holding them through some sort of pension -> managed fund -> ??? style chain where they are exposed to the madness without realising it. As long as Uber's owners know who they are, it is on their heads if burning money turns out to be a bad idea. Not a problem for the rest of us, if we can be confident we don't own the company. Assuming the government doesn't helpfully bail them out at some point.
  - tixocloud 6y ago
    >> they indirectly holding them through some sort of pension -> managed fund -> ??? style chain where they are exposed to the madness without realising it. This is the main reason why big companies are never allowed to fail. Why banks and all the traditional giant establishments continue to live. It's also why publicly listed companies that have been dividend paying for some time would rather layoff employees when growth prospects are scarce than to rather maintain them on payroll. So if your company's stock is ever owned by government/pension funds, you'll have a pretty good argument for getting bailed out until you find your next trick.
uptown 6y ago
> "Looking at it from my consumer perspective Uber is net positive - even if it ends up being unsustainable and goes bust eventually." Leaving behind what options for short-range travel? If Uber goes bust and in the process, they've killed off both their competition and traditional taxis, what options does that leave for short-range individual commuting where bikes and scooters aren't sensible?
- matthewdgreen 6y ago
  The Uber model is pretty easy to duplicate. See e.g., http://www.rideaustin.com/ http://www.rideaustin.com/
  - uptown 6y ago
    Sure. But why would anyone pursue it if they've demonstrated that long-term it's financially insolvent?
    - matthewdgreen 6y ago
      Presumably prices will increase to a sustainable level if the big VC-money-burning firms go out of business. I can see ride sharing becoming more expensive -- I just don't see any future in which it goes away.
  - mycall 6y ago
    Even mass transit is experimenting with Flex semi-fixed routing.
bart_spoon 6y ago
A net positive from a consumer is not equivalent to a net positive for society.

chefkoch 6y ago

> The prices in the local taxi market didn't go down a few % it got fractionally cheaper - it went from being barely affordable and only used in exceptional cases to a substitute for car ownership and not having to think about using it (depending on your daily commute). That's because they loose money with every ride? I mean it really can't be cheap to have your have your personal driver for your daily commute.

rubber_duck 6y ago
The thing is there are other taxi services locally that are competing with Uber at similar prices. Even if prices went up 30% it would still be in the "I don't have to think about it" territory.
- chefkoch 6y ago
  I'm not sure how this is possible as afaik taxi fares are heavy regulated. Just because Uber subsedises rides no city council will change the taxi fares. https://www1.nyc.gov/site/tlc/passengers/taxi-fare.page https://www1.nyc.gov/site/tlc/passengers/taxi-fare.page
  - rubber_duck 6y ago
    Oh I should mention I'm in Europe and have no idea about how Uber works in the US.
  - andrewl-hn 6y ago
    "Taxi" taxis are not the only types of services like this. Depending on where in the world we're talking there have been other companies - often locally run or covering a few neighboring countries that use the same model Uber is using. Or offering similar ridesharing options via a phone since 1980s or 1990s. In my area (Eastern Europe) Uber matched the prices of other unofficial "taxi" services that existed for 40+ years. However, the convenience of having an app, not dealing with cash, ability to see your driver getting to meet you, etc. boosted the number of taxi riders tenfold. Many other ridesharing companies are offering apps these days, too. So even when Uber goes bust, the industry won't revert back to cash payments and phone numbers. So like the grandparent said it's a net positive for consumers.
  - KptMarchewa 6y ago
    Do you know NYC and SF are not the only places where people live?
    - chefkoch 6y ago
      Yeah, i'm from germany but most people here would have trouble reading german taxi regulation.
  - vidarh 6y ago
    A lot of places there is a sharp licensing distinction between requirements for those who want to be able to pick up unscheduled passengers on the street or taxi ranks, vs. those who only pick up on request or from their own locations. Overall the latter category tends to face far fewer limitations and be a lot more competitive.
edouard-harris 6y ago
They do not lose money with every ride, at least according to their most recent investor presentation [1]. Their rides segment is already profitable - albeit on an EBITDA basis, but with decent and growing margins. [1] https://s23.q4cdn.com/407969754/files/doc_financials/2019/sr/InvestorPresentation_2020_Feb13.pdf https://s23.q4cdn.com/407969754/files/doc_financials/2019/sr... (slide 15)

azernik 6y ago

Of course it's a net positive to consumers. It's a business being run at a loss, and propped up with constant capital inflow - i.e. a massive transfer of wealth from investors to consumers.

rubber_duck 6y ago
My point is that it's not just about operating on a loss - other companies locally are competing with Uber and amongst each other and the market that was once protected by shady licensing monopoly is now open wide - even a price increase of 20-30% will not change the way I use taxis right now - and that would be very sustainable (I don't see local uber as a loss generator with their pricing as the other taxi companies are able to compete - the marketing money Uber is sinking is probably what's generating the losses)
- Traster 6y ago
  A price increase of 20-30% may not effect how you use taxis, but it will effect how lots of other people use taxis, and because loads less people will use taxis at 20% more they won't need to charge 20% more, they'll need to charge 20% + their decrease in utilization. Suddenly you're in a death spiral where they can't charge enough to make a living at any price.
  - rubber_duck 6y ago
    I doubt this. Initially when Uber arrived there was no regulation around here - the prices were ~30% lower and people driving Uber were actual part time drivers with clunky old cars - this was the ideal Uber time for me because in my smaller hometown I could get a ride almost instantly in any part of the city and I didn't care about ride quality if I didn't get dirty or smelt bad after I left the car. After taxi protests the government stepped in to basically enforce rules where part time driving became really hard - you have to have a car newer than 5 years, need to have some sort of work contract - not necessarily with Uber but a lot of forms of started small companies that then partner with Uber - but you no longer had limited taxi licenses - anyone can get a car and setup Uber. This resulted in prices eventually rising by 30-50% depending on the city, more importantly it resulted in lower availability in smaller places because it blocked small part time drivers. At this point local taxi companies are still complaining but there are now taxi services cheaper than uber depending on mileage. So in a way this Uber market transformation already happened. Like even at current prices an average taxi ride is 2-3x cheaper than it would be 10 years ago when it was basically a government granted cartel. And you were at the mercy of the driver randomly quoting you whatever he though you would pay in a lot of situations. Uber brought a lot of consistency and availability to the market.

TeMPOraL 6y ago

That's why you can't look at it just from your consumer perspective. The only thing necessary for the triumph of evil is to hide it from good men behind a layer of indirection. Another thing is: taxi innovation isn't either Uber or nothing. All these improvements Uber boasts about could have been achieved (many were achieved in some places) without tolerating illegal business practices by a thoroughly sociopathic international corporation. Maybe the progress would've been a bit slower, maybe there would be more competition on the market (which is usually considered a good thing). But it would be there, and done the way civilized people do things. And before someone replies, "but MLK was also doing illegal things!" - which is a response I see surprisingly often in Uber threads - let me remind everyone, that MLK was engaging in civil disobedience to fight for the common people and a just cause. Uber is a for-profit company with long and documented history of antisocial behavior, and one which only cares about dominating their market by dumping any and all externalities onto the society at large.

roenxi 6y ago
It is fine for consumers to look at things from a consumer's perspective. And it isn't controversial that Uber is offering the consumers a fantastic deal. The real question to me is do Uber's stockholders understand that they own the stock, or ar they indirectly holding them through some sort of pension -> managed fund -> ??? style chain where they are exposed to the madness without realising it. As long as Uber's owners know who they are, it is on their heads if burning money turns out to be a bad idea. Not a problem for the rest of us, if we can be confident we don't own the company. Assuming the government doesn't helpfully bail them out at some point.
- tixocloud 6y ago
  >> they indirectly holding them through some sort of pension -> managed fund -> ??? style chain where they are exposed to the madness without realising it. This is the main reason why big companies are never allowed to fail. Why banks and all the traditional giant establishments continue to live. It's also why publicly listed companies that have been dividend paying for some time would rather layoff employees when growth prospects are scarce than to rather maintain them on payroll. So if your company's stock is ever owned by government/pension funds, you'll have a pretty good argument for getting bailed out until you find your next trick.

uptown 6y ago

> "Looking at it from my consumer perspective Uber is net positive - even if it ends up being unsustainable and goes bust eventually." Leaving behind what options for short-range travel? If Uber goes bust and in the process, they've killed off both their competition and traditional taxis, what options does that leave for short-range individual commuting where bikes and scooters aren't sensible?

matthewdgreen 6y ago
The Uber model is pretty easy to duplicate. See e.g., http://www.rideaustin.com/ http://www.rideaustin.com/
- uptown 6y ago
  Sure. But why would anyone pursue it if they've demonstrated that long-term it's financially insolvent?
  - matthewdgreen 6y ago
    Presumably prices will increase to a sustainable level if the big VC-money-burning firms go out of business. I can see ride sharing becoming more expensive -- I just don't see any future in which it goes away.
- mycall 6y ago
  Even mass transit is experimenting with Flex semi-fixed routing.

bart_spoon 6y ago

A net positive from a consumer is not equivalent to a net positive for society.