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the difference is in the details. what you say is incredibly hard. they set up a global service in thousands of legal jurisdictions that let's you use one app
by dongvsascript 6y ago
the difference is in the details. what you say is incredibly hard. they set up a global service in thousands of legal jurisdictions that let's you use one app. in rome you can only legally get a black mercedes qualified as a limo. in dubai you can order a lexus taxi or an uber helicopter. in chicago anyone with a car can be an uber. in moscow they have to go through yandex taxi. to me, in any city with all its different rules, I pop open an app, order what i want, and it just gets charged to my amex. they handle insurance rules, they handle refunds and disputes, they provide mapping software drivers use - worldwide, so you can look at your route and not get ripped off by a cabbie. they provide car leasing services to drivers like a dealership.
this is an insanely complex feat to accomplish. it's also expensive.
what does a taxi service do? it's a guy sitting at dispatch assigning calls to cabs.
the stock exchange is complex too. not nearly as complex, with much more well-defined and common rules. but even they don't just charge you. they also charge listing fees, regulatory fees, governance, access to data fees, and sell services and software for trading. you are also comparing a trade transaction to a cab ride. sorry, a cab ride is a much bigger and more involved thing than a button you click on a website.
- rmrfstar 6y agoYou make a good point. NYSE fees do not represent the full cost of intermediation for cash equities. But my core point remains: the cost of intermediation in the financial sector is 1-2 orders of magnitude lower than 30%. I don't think you are making your complexity argument in good faith. It is ridiculous to suggest that Uber's order matching and payment infrastructure is more complex than the full chain of financial intermediation, from order matching through clearing, settlement, and custody.
- dongvsascript 6y agoi think you completely ignoring the main point i detailed out, that order matching is a tiny part of what uber does, is what is not in good faith. it's a company with 4 million workers in most countries and cities worldwide. let's say you want to start a taxi company in tokyo. find and hire about a thousand drivers. your costs are just writing an app, right? how about saudi arabia? now take those costs and multiply by 4000. you want to compare to nyse? cool. ask them how much money it will take to trade every stock worldwide following local rules, for any country's citizen. hire 4 million workers. make sure i can use the same app for every transaction and just put it on my amex.