21 ms·

We must return to an economy fueled by innovation, rather than disruption

• baash05 5y ago
  https://greg-satell.medium.com/how-the-uber-economy-is-killing-innovation-prosperity-and-entrepreneurship-7222982cd457 https://greg-satell.medium.com/how-the-uber-economy-is-killi...
  • deleted 5y ago
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• ozim 5y ago
  So as I read the article main argument is, as rephrased: Commercial airlines are building on top what Wright brothers did and just grab easy money instead of figuring out how to fly people to the Moon.
  • Beltalowda 5y ago
    I think that is an unfair summarisation since all the Wright brothers did was fly a very non-practical plane for about ten seconds as a kind of "MVP". There was no market. Commercial airliners took that core technology, refined it, and used it to actually create an entire new service and market.
    • ozim 5y ago
      I am writing about Ryan air or Southwest those companies did nothing to on R&D for flights. No one is accusing them that we don't have a Moon colony because they are doing what they do. Author is accusing application operating company that there is not enough innovation because of them. So it seems author just took Uber marketing division where they shout about "innovation" seriously. There are companies that are doing actual R&D and Uber is buying services/goods from them, so it is like Southwest buying Boeing planes is actually paying R&D costs of coming up with better planes. Also author is making point that somehow there is not enough innovation - well I have different point of view - whole innovation happened and made it possible to operate something like Uber. Smartphones and mobile connectivity with GPS is the innovation that was not as widespread 20 years ago, heck even 10 years ago things were still starting up.
      • Apocryphon 5y ago
        > So it seems author just took Uber marketing division where they shout about "innovation" seriously. I mean so did VCs, the tech press, new CS graduates, and Silicon Valley in general.
• lifeisstillgood 5y ago
  My take on the productivity paradox is software is a form of literacy. We have put a pen and paper onto every desktop and every pocket but almost no-one can read or write. Edit: And those that can find that only a tiny fraction of the fold is written down (accessible through the virtual cyber world). Amazon's secret to success was forcing every service to live behind a "public" API.
  • heurisko 5y ago
    I disagree that writing software is comparable to literacy. I think it's more similar to any other profession, with a skillset you can learn if you're interested, or learn to get paid. Not everyone is interested in writing software, and that's fine. It has also never been easier to tinker with things, as root VMs are cheaply available, in comparison to 20 years ago, when you really were just given a cpanel interface, if you were on a budget.
    • verve_rat 5y ago
      Not writing software, using it requires software literacy. How many people do you know that refuse to learn the software they use everyday? How many times have you helped a friend or colleague with some problem just by googling it even when you don't really understand what they do for a living? It's not that we need everyone to create software, but it would unlock huge productivity gains if everyone stopped pasting screen shots into word. Excel might be the most important knowledge tool of our time, and almost no one knows how to use it.
      • andi999 5y ago
        Somehown I think the literature on excel is lacking. Do you know any reference which shows 'how to use it' in your sense?
        • sokoloff 5y ago
          I think learning has changed as well. It’s no longer a (traditional canonical) reference that’s most useful (though Microsoft surely has one on each version of excel) but rather “how do I formulate a search to help myself here?” Programmers have been doing GDD* for a while. Other knowledge workers will catch up or be left behind their peers. I use Excel weekly, but not daily. The last thing I remember googling in it was last week and it was (for the fiftieth time) “excel format as millions”. * Google Driven Development
• pabs3 5y ago
  https://archive.ph/20220313085155/https://greg-satell.medium.com/how-the-uber-economy-is-killing-innovation-prosperity-and-entrepreneurship-7222982cd457 https://archive.ph/20220313085155/https://greg-satell.medium...
• IMSAI8080 5y ago
  I heard the problem expressed as a good ideas shortage versus too much investment capital. Interest rates have been incredibly low since the 2008 banking crash, so where does the spare capital go? There's not enough innovative ideas around (that investors like) to absorb the money. So some of the cash is getting thrown at complete nonsense and the remaining good ideas are receiving excessive capital. So there's a lot of inefficiency in there.
  • HPsquared 5y ago
    It sounds more like a banking problem than an innovation problem.
    • ilikerashers 5y ago
      I agree with that. Money seems to flow to "safe" products. Some minor iteration of payments, CRM, taxis or fitness. How do you fix it when the incentives are skewed towards quick bucks? Government pushing certain industries has worked for China. There'll be a lot of opposition to that in the US I'd imagine.
      • amurthy1 5y ago
        It happens to a degree in the US with federal research grants, but maybe not to the extent of other countries.
      • nradov 5y ago
        That's not even remotely accurate. There's a huge amount of investment capital flowing to other sectors. Just because people aren't posting about it on HN doesn't mean it's not happening. https://www.crunchbase.com/ https://www.crunchbase.com/
    • xoserr 5y ago
      We talk about these things like they are separate closed systems when they are not. It is an innovation and banking problem. There are all kinds of feedback loops involved. The ridiculous amount of liquidity in the global system changes and distorts risk preferences. It also creates these giant sinks of brain power that are just moving money around. We have had amazing innovation the past twenty years in electronic markets, hedge funds, venture capital firms, cryptocurrency. Think of how much brain power is being wasted just modeling capital structures instead of something actually innovating because there is so much capital moving around that needs to be modeled. How much brain power is being wasted at hedge funds? I have read hedge fund manager Jim Simons say he thinks he has the best research department in the world inside his hedge fund. It is not that much different than dedicating the best research department in the world to playing better poker. It is an utter waste of resources and we see it all around us with the complete lack of innovation.
• hughrr 5y ago
  It’s also killing customer confidence by providing the shittiest low ball unreliable service possible.
  • sokoloff 5y ago
    Uber did many things, but “provide shittier or less reliable service than circa-2000 taxis” isn’t among them.
    • hughrr 5y ago
      I regularly use non Uber taxis and have found them to actually be reliable. I'm in London and I'm not talking about black cabs for ref.
      • chii 5y ago
        Was taxi reliable and good prior to the advent of uber?
        • hughrr 5y ago
          Yes very reliable. They still are. Just Uber has an app and attention now.
  • whitepaint 5y ago
    There is a button, you click on it, a few minutes later someone comes to pick you up. Like seriously, what the hell are you talking about?
    • hughrr 5y ago
      Mostly the demand pricing model which is up to 5x the cost of other local services, the absolutely abhorrent non-existent customer service, the 25% of the time when you order an Uber and it gets cancelled, the transaction processing problems which seem to go in waves of plague and the buggy as hell app. And don't even get me started on Uber Eats which universally delivers cold, damaged food which is twice the price of going in the store and their customer support is so bad that it's nearly impossible to get a refund from them now even though it was 2 hours late and looked like it'd been delivered in a washing machine on a spin cycle.
• taurath 5y ago
  Having taken a $30 Uber to drive 15 minutes lately, when a taxi would’ve cost $10 or so, I don’t think they’ve ultimately created much value with their rideshare service. They’ve basically just moved the entities around, and now it takes a lot longer to get a taxi. Ultimately this is an era largely of the conglomerate, it doesn’t matter who you are unless you’re one of the big fishes. Media, Advertising, etc. Its no longer small shops that are creating interesting and useful things, at least not at the rate they were. It’s more likely to be an expansion out of a big company into a marketplace trying to sip an audience than it is a disruptor changing any of the game. The disrupters that exist must get and stay large as fast as possible as well. I’m looking for things that don’t scale. I think we’ve basically poured all societies money into anything that might scale. We’ve found we have run out of those things. And all the problems we have left are things like education, homelessness, lack of meaning, healthcare, etc. All problems so entrenched I’m willing to say at this point they can’t scale, and therefore won’t be solved. Maybe the next technological revolution will be a social dynamic. Who knows.
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  • xmprt 5y ago
    That doesn't sound right to me. The only place where you're paying $30 for an Uber where 1. it would have been possible to call a taxi, 2. the taxi only costs $10, 3. it's a 15 minute drive, is in the middle of a big city. In that case, why are you calling an Uber instead of using public transit? Yes, Ubers are more expensive than taxis in some cases, but in many other cases, they can do things that taxis can't.
    • unicornporn 5y ago
      > but in many other cases, they can do things that taxis can't. Like what?
      • sokoloff 5y ago
        Easily coordinate pre-paid transportation limited to your event as one: https://help.uber.com/riders/article/vouchers-for-events-faq?nodeId=00668aab-aeba-435b-bd1c-674cf566b3a7 https://help.uber.com/riders/article/vouchers-for-events-faq...
• simonbarker87 5y ago
  Fully agree with this. It seems like so many of the apps that come to dominate just make up for shortcomings unique to the US that then, with money, take over the rest of the west for no good reason other than scale to get 25 people at the top of those companies rich. I’ve never seen the need for Uber. Taxis have never been an issue in the UK and the most successful firms in the city I lived when Uber was starting out already had apps. Literally the only thing Uber had going for it was masses of money to undercut the market and advertise to younger millennials - basically their excess money allowed them to get better distribution and cheat the market. I’ve used Uber three or four times in my life and each time was a worse experience than a taxi.
  • ur-whale 5y ago
    How do you pay your regular taxis in the UK?
    • deleted 5y ago
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    • simonbarker87 5y ago
      Cash, card or tap and pay. I was paying taxis with card before Uber was a thing. US payment systems lag the rest of the world massively - particularly the UK
      • ur-whale 5y ago
        > Cash, card or tap and pay. Still way more friction than Uber where you setup a payment method in the app once and no actual payment is ever required to the driver, pretty much anywhere in the world. Also: 1) how do you tell the driver where you want to go? I've found this to be a major PITA with many cab fares, especially if you drive to unusual destinations. I've met many a cab driver that simply are incapable of using google maps. Case in point: a month ago in a small European town where Uber is banned by the local thugs who run the town, I give my destination to the driver at the cab station, lo and behold, he proceeds to spending 10mn first asking and then arguing with his colleagues in the local patois how to get there. I tried to step in to show them on my phone, they basically ignore me, because they obviously know better. The fact that I;m in a hurry is the least of their concerns. Ugh. 2) How easily and quickly can you get cabs to pick you up exactly where and when you want, especially if we're talking less than 10mn delay? In a big city like LON that might not be a problem, but from experience, and I'm talking about European capitals, and smaller cities in the US or Asia, this is *way* worse than the Uber experience. As a matter of fact, an Uber ride requires zero interaction with the driver other than agreeing that you're the customer and he's the provider. Quasi-frictionless and immediate, which - in my book - makes it a winner in spite of them having a despicable corporate culture. The price considerations are a different conversation, but AFAIC, I'm certainly ready to pay more for an Uber to get to that frictionless transaction. The day a cab ride is as easy to setup as an Uber ride, I'll very gladly stop using Uber. But in most places, that simply isn't the case.
• morpheos137 5y ago
  Taxi service is not exactly an innovative idea. Neither is mail order catalogue (Amazon).
  • Ekaros 5y ago
    I think innovative idea is to get people think they make money when you rake rake of 20-25% and they provide the service for peanuts. And then they kicked out if they don't do it well enough.
• kjgkjhfkjf 5y ago
  Uber and Lyft have made life much easier in San Francisco, since the taxi service here is very poor. I was in Vancouver a few years ago, before they allowed Uber and Lyft, and we had an extremely hard time getting a taxi there too.
• Barrin92 5y ago
  One of the most interesting insights to me about this dynamic of profitless, innovation lacking platforms came from reading a Varoufakis piece. To him the reason platforms exist as they do right now is because they constitute a fundamental shift away from market capitalism to what he calls techo-feudalism. Instead of thinking of companies like Uber as selling software and paying wage labour to generate profit, it makes much more sense to think of it as a fiefdom that extract rents directly from its users outside of markets, maintains unpaid or barely paid labour, essentially a techno-peasant class, and is funded by barons in the form of VC capital directly and the state indirectly. Through that lens for the first time to me it made perfect sense why it isn't so absurd to have gigantic companies that barely make any profits, have no differentiated products or much of a workforce. The point of these new businesses isn't to dominate markets and sell things at great margins, it's to claim territory, extract value and then use that control to directly command users on your behalf. https://metacpc.org/en/crypto-blockchain/ https://metacpc.org/en/crypto-blockchain/
  • totetsu 5y ago
    Techo Serfdom.
  • cuteboy19 5y ago
    The 3rd paragraph is incongruous with the 4th paragraph. If they are not generating profits then how come we accuse them of extracting rent and "maintaining techno-peasants"? The major characteristic of feudalism was that power centers deteriorated and power was distributed to local lords insted of central kings. So how is having a single gigantic company more like feudalism? Lastly, why come up with such convoluted theory when "too much speculation due to cheap debt" explains everything with much less gymnastics
    • Barrin92 5y ago
      > If they are not generating profits then how come we accuse them of extracting rent because those are not the same thing. Feudalists don't extract surplus wage labor, they extract direct tribute from their subjects, and just like that the entire value of Facebook say, is in what its users produce on its platform. That experience is the actual rent they collect. Ever wondered why all of this stuff is free? And power is deteriorating. Away from the state, which played a central role in organizing and managing the traditional market economy towards these private spheres of influence of which the principal unit is the tech-firm.
• servytor 5y ago
  I just find it really weird that there wasn't a thinktank in 2005 or so, that said "Okay, what are the next big phone applications?" and invented Uber and a few others. What is the point of these thinktanks if they can't predict 3 years ahead along our current technological advancement curve?
  • gervwyk 5y ago
    I have friends in South Africa who built a small business similar to uber in 2004 on SMS and future phones. Worked really well, however, at the end of the day an idea does not build a business like uber. Extremely well executed startups does, which of course requires a team in just the right milieu and timing.
    • DaiPlusPlus 5y ago
      > I have friends in South Africa who built a small business similar to uber in 2004 on SMS and future phones. (I assume you meant "feature-phone" there?) You should tell your SA friends to reach out to some tech journos, they'd love to write a "Uber before Uber" story, and I'd like to know the reasons why their project didn't pan-out myself. SMS-based applications had a lot of potential in the mid-2000s, often the failures were elsewhere, and doesn't SA also have SMS-based billing too? that could have been an amazingly successful service...
      • l-lousy 5y ago
        I would guess because they didn’t have billions in Vc money to lose while they tried to weed out competition and secure new customers
        • lotsofpulp 5y ago
          I would guess they did not have the timing right with the advent of 3G internet with minimum viable bandwidth to be able to operate things like maps and GPS and payment processing in real time, combined with the advent of usable mobile phones with sufficient qualities of battery life, touch screen sizes, and computing power. The 2007 to 2012 period was a perfect storm of bringing together connectivity with never before utility from newly developed devices, and if you were in the right place at the right time to stake a claim, then you had significant first mover advantages. It was discovering new land that had not been settled yet, similar to when computing and society advanced to allow for computers in every home, and then internet connectivity, and then finally, 24/7 computing plus internet computing in your pocket. Of course, having deep, deep pockets to hire the people at the forefronts of this land rush is also a huge advantage.
• CryptoPunk 5y ago
  In these conditions, it makes sense to pump as much money as possible into an early Amazon, Google or Facebook. However this seemingly happy story has a few important downsides. First, to a large extent these technologies do not create new markets as much as they disrupt or displace old ones, which is one reason why productivity gains are so meager. No. They displace old industries by introducing technologies and processes that made them more productive. People use them because they provide a higher quality service at a lower price. And all three of the examples he provided: Amazon, Google and Facebook, have been enormously innovative, and created entirely new markets. I could write a long essay on the markets that had their emergence faciliated by any one of the three companies listed. What's worrying is that such an obviously misinformed article could be held in such high esteem by so many on HN.
• roenxi 5y ago
  It is worth considering that the problem is too much debt and that people are missing the forest for the trees. Gambits like Uber still aren't profitable or sustainable, and we have no idea what sort of market it'll be working in once it tries to make money. By the books, it appears that Uber's "investors" have been burned quite badly. Putting in the hard work to build a profitable business is less rewarding by comparison to making a high-growth low-value-add play and trying to get money off people with access to big lines of credit. And, ranting, it is still quite possible that Amazon/Google/Facebook are going to lose the super profits in the long term. Which to me means 2030+, 2040+ as the market matures. Google is probably a bit more secure in that they have to commit suicide to lose money (which they will eventually, every company gets bad managers sooner or later). AWS on the other hand faces a risk of being chipped at from all angles by specialised providers. They do not have a magical spell that can resist the market moving towards the marginal cost of production. Facebook lives in a world where staying power is the exception not the norm, they came after numerous other competitors that fell apart under the complexity of managing social networks. They are all but guaranteed to fall in time too, they are in a delicate position where it takes one bad CEO/Director of Misinformation or some Chinese upstart that won't sell out and the whole thing could fall apart.
• a-dub 5y ago
  this is what the real web3 is actually going to solve. out with globally centralized service dispatch and paupers doing the work on unencrypted user data siphons and in with decentralized identity, reputation and commerce systems that sell to small business. tools so small business can be as good as uber, everywhere.
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• shmde 5y ago
  In India, the drivers at Uber Bikes(paid better than rapido), Rapido(bike ride startup) are paid sooo damn low by these companies that we have to give them 20-30% extra on top of the actual ride price. How low you might ask ? 40 cents to travel 3-4Kms in my city. One Gallon of petrol costs over 6 Dollars in India. They keep showing these ads that the price is low to attract the customers, pay the drivers even less and then The customer and the drivers have to make a deal outside of the platform before the ride is even initiated. I have no idea how will the drivers survive with the extremely low wage. I have switched back to public transport just like the good ol days before the uber era.
  • nstart 5y ago
    For some who might wonder how Uber attracts riders to the platform, it’s done through “bonus” payments. They give riders “goals” to achieve in terms of numbers of orders completed. Achieve these numbers each month and you get a bonus. The bonus is usually comparable to an expected monthly wage. Over time though, the goals go higher (Uber says the demand is more but fails to say the supply is more as well) and then the bonus goes down. Over time it just becomes an abusive relationship. But like a person trapped in a Ponzi scheme, many drivers believe they can do it if they work hard enough (they shoulder the blame) and they stick on.
• ChicagoDave 5y ago
  The loss of innovation has zip to do with the Uber Economy. Try the fact that the middle class has been gutted by an unfair tax structure that shreds responsibility away from the wealthy and corporations and has created peripheral damage in high college cost and low public school expectations. Bring back the tax rate where people making over 540k (the 1980 equivalent of the top tax rate $225,000) pay 50% on anything over that amount. In 1980 it was 70%. SEVENTY PERCENT. If we raise the top tax rate, we pay for infrastructure, college, teachers that can teach critical thinking instead of how to pass a test. The middle class can chill out and raise a family, take a vacation, save for retirement, and not live pay check to pay check. We rebuild the middle class. What happens if college goes back to a Pell grant and a part-time job cost? INNOVATION. People will have the ability to think freely and be creative. They won't be forced to figure out a career at 18-21 years old. Guess what else we do? We start paying down the national debt for once and actually reducing the debt ceiling. Our tax structure is insanely out of balance. That's the number one core problem in the United States.
  • alexashka 5y ago
    > Our tax structure is insanely out of balance. That's the number one core problem in the United States. How do you know that? What are your qualifications?
    • ChicagoDave 5y ago
      I can read and look up historical records. This isn’t rocket science. The combination of gutting our tax rates plus the GOP spending trillions on wars and tax breaks has killed the middle class. Look at everything Reagan did during his first 4 years. He decimated the middle class and waged war on black people and the poor.
  • solatic 5y ago
    Excepting star-power labor (professional athletes, entertainers), most of the income in the upper tax brackets goes to the owners of capital. When stocks pay dividends, the dividends are taxed as income. If you raise taxes on upper-tax-bracket income, you just promote stock-based compensation instead: compensation in stock options (which are taxed as capital gains when realized, not income), stock buy-backs instead of issuing dividends (again, capital gains rather than income), etc. The long-term capital gains tax rate, for those in high tax brackets, is 20%. Go ahead, set the income tax rate for high tax brackets to seventy percent. It won't actually make a difference.
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• herunan 5y ago
  Can we get an open source gig economy app where 75% of the profits go to gig workers? Then 7.5% would go towards employee rights and benefits of gig workers, 7.5% towards contributors improving the software, and 10% towards customer support and legal third parties.
  • timkam 5y ago
    IMHO, such apps should be considered infrastructure and be regulated accordingly (or be managed by foundations).
  • 300bps 5y ago
    Can we get an open source gig economy app Sure, start writing it now. The journey of a thousand miles begins with one step.
  • akvadrako 5y ago
    It's called a platform co-op and many exist, but it's hard to compete with VC money. Uber is losing money so I don't know think drivers want a slice of the profits.
    • jlokier 5y ago
      What, if anything, is preventing for-profit platform co-ops from obtaining VC money and chasing a similar growth-to-unicorn curve? Is it just cultural inertia, i.e. nobody has tried yet?
      • PeterisP 5y ago
        If the purpose of the co-op is to ensure that profits go to the workers and not to company owners/investors, then either you plan to fail at that purpose or you're not interesting to the investors. If the lion's share of the operating profits would go to the investors, it's no better than Uber, if the lion's share of the operating profits would go to the drivers, then what's the motivation to invest?
      • noogle 5y ago
• Hnrobert42 5y ago
  I thought I read in a different article that we have seen tremendous gains in productivity but no gains in real wages.
  • bsenftner 5y ago
    There is no real journalism, only perspectives trying to win mindshare. Those that believe, and may be able to prove in productivity gains are being actively shouted down by those better funded saying otherwise. The truth? There is no truth.
    • Hnrobert42 5y ago
      I believe this is not true. There are degrees of truthfulness. Some journalist do a better job than other. Such cynicism is the exact effect tyrants like Trump and Putin seek. It means they are free to do as they please.
      • bsenftner 5y ago
        It's a market place of rationalizations, with the winner being the most feel good.
• temporalparts 5y ago
  Any article that says: > Anybody who’s ever taken an Economics 101 course knows clearly has no idea what they're talking about. Real market are far more complex than what can be described by Economics 101
  • DaiPlusPlus 5y ago
    I gather that it's even worse than that: I've heard that Econ 101 teaches those commonly heard things (supply/demand curves, inflation, etc) so that higher-level courses can then contextualize why they're so wrong and oversimplistic when they teach the "real" current theory (kinda like how we still teach the "electrons orbiting a nucleus" model in HS physics only for undergrad-level physics to say "that's all wrong: their position is described by a probability-density wave-function". Gotta start somewhere, I guess - but I'm just afraid that because I'm nowhere near an expert that I'll be bamboozled by someone with legitimate qualifications, but without realizing that they're actually still not qualified to speak about the subject either.
• pete_nic 5y ago
  From “ Total Factor Productivity Growth in Historical Perspective” referenced in the article: > Economists have long found that they can explain only a portion of economic growth by the growth of inputs to production, such as the number of hours worked or the amount of capital used. The unexplained (or residual) portion, which presumably reflects advances in production technologies and processes, is conventionally attributed to all of the production factors together and is referred to as total factor productivity (TFP) growth. I don’t think it’s fair to blame Uber for the lack of economic growth for the entire USA. In addition, the paper referencing the economic slowdown compares 1970-2006, 36 years, to 2006-2016, 10 years. And during those 10 years the housing bubble collapsed. The dates selected appear cherry picked to show the largest decline possible.
• edw519 5y ago
  We must return to an economy fueled by innovation, rather than disruption, 1920 - 1970: Technology = Solution for a Problem At Hand 1970 - present: Technology = Solution looking for a Problem to Solve
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• MomoXenosaga 5y ago
  Disruption in our economy means "losing billions of euro for years". The race to the bottom I'm seeing in e-commerce is just hilarious. Great for consumers. Not so great if you are a delivery driver.
  • ChuckNorris89 5y ago
    So, Amazon's business model?
    • pessimizer 5y ago
      Amazon's business model was being first and not having to pay taxes for a decade and a half.
      • Shuang1 5y ago
        Amazon was not the first in e-commerce and they "didn't pay taxes" because they reinvested the money rather than taking it as dividends. Amazon won because of their efficiency and customer service. Even today, FedEx usually takes weeks to deliver while Amazon has same day or two day delivery.
  • buran77 5y ago
    Disruption these days is mostly about playing by a set of rules you invent for yourself to get an edge on the competition and calling it innovation. It's rare that real innovation is used to disrupt. Imagine disrupting any industry where some form of accreditation is required by making an app which allows any person to perform those services. Anyone could be a doctor, lawyer, notary, etc. with no license needed. That's not disruption, that's breaking the law until the company is big enough to bribe (lobby) to change the law to allow that. That's literally Über-style "disruption".
• version_five 5y ago
  Where I was during uber's ascent, uber's defining value proposition was circumventing the artificial monopoly created by the taxi medallion system. This "disruption" was actually great, it shook up an industry that needed shaking up (ironically I now use cabs because they have become better than uber where I am. This would not be the case if uber never existed). But even if it did some good "disrupting", I think the article's point is it's not real innovation. Same e.g. with self booked travel, self scan groceries, etc, they are not really innovating, they just change a power balance. So the it ends up being bad when all the capital is chasing these disruptors instead of "innovators" for some definition. The thing it misses, I think, is that many of the big winners (or monopolies if you like) actually do end up funding massive amounts of innovation. Facebook and Google have contributed huge $ to AI/ML research, Amazon Go I think qualifies as real innovation (and I think there are many amazon examples that are more than just an app). Tech is easy to pick on (I've picked on it a lot) and Uber may be an egregious example of a company that disrupted and didn't give back (though they don't make money either). But I think there has been some major innovation come out of tech companies, even if that isn't how they got rich in the first place.
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  • Retric 5y ago
    What’s missed in these discussions is these regulations had a point to them. It’s obvious Uber driving around without passengers increases congestion. Really look at AirBnb, Bird, etc and they all offload externalities from the company and it’s customers to everyone around them. When the basic building model is to break the law, chances are the law had a point and people are going to want a return to normal eventually. The only way they survive long term is if the general population feels it’s the new normal is a useful tradeoff. In the short term they can massively subsidize users, but long term the same basic economic reality sets in so they need some actual innovation.
    • horsawlarway 5y ago
      > What’s missed in these discussions is these regulations had a point to them. This varies a lot by area - For example, I'd say the NY medallion regulations had a point to them, and that point was to systematically abuse cab drivers for the profit of the local government and banks. Then for example - in my area (Atlanta) medallion supply was capped at 1600 - the result meant cabs basically didn't exist outside of the airport. Need a ride home from a party? Called a cab company? They won't show up. At all. They will dispatch cab after cab after cab that simply will never EVER show up. Cabs would show up to exactly two places - Nice hotels that paid them under the table to make sure they kept coming, and the airport. Conveniently those two places tended to make circular trips. So are there negative externalities to ride-sharing? Sure. Is it currently better than the previous cab monopolies? I'd argue yes. Do Uber and Lyft really represent a sustainable model? I don't think so.
• zaptheimpaler 5y ago
  The problem is incumbents get lazy and start profit-seeking. Competition is the only way we know to have a chance of fighting it. The taxi industry got away with ripping off customers and having terrible service for ages. In my country they would regularly overcharge or take longer routes. Or you call and they decide not to come, or you walk around waving your hands frantically at a taxi hoping they stop. As a tourist, its even worse because you have no idea what the rate should be. I don't know if gig companies or all VC companies are perfect, but lets not pretend industries regularly fail to innovate in the absence of competition. Healthcare - the tech disruption in healthcare actually makes it easy to see a doctor over video call for small stuff and easy to track my records over time. The existing healthcare system requires me to call and wait weeks for an appointment and use some clunky UI to even message a doctor. And everyone knows how terrible insurance is.. Banks - In Canada, I can't get a single bank to give me API access to my own account. Their native interfaces suck, and connecting with Mint is frequently buggy. Mint itself is much worse than Quicken for browsing transactions, grouping, charting, but Quicken's API connection to banks sucks, despite also being built by Intuit. Crypto websites and apps are much better & provide great API access. If they had a trustworthy stablecoin, i would move in a heartbeat. Education - university prices keep going up even as their model remains the same. Even as the actual content of courses is freely available online. University costs are insane, student debt levels are insane. Software is the first industry where the majority of what you need to know especially as you move beyond general CS comes from the internet, _for free_. Electric cars/space - Reusable rockets were literally considered impossible a decade ago, they are reality now. Like it would be great to have actual innovation. It would be nice if we had any meaningful anti trust enforcement or other ways to force innovation. But in my (relatively short) lifetime, i have almost never seen large scale innovation happen in the absence of competition. Any serious competition feels like "disruption" to industries accustomed to hanging out and collecting profits.
  • adfgadfgaery 5y ago
    >Reusable rockets were literally considered impossible a decade ago And we have always been at war with Eastasia. The Shuttle program was started in the 1970s. Reusable launch vehicles have never been considered impossible, merely inefficient.
• 650 5y ago
  I’ve been using delivery apps on and off for the past few months. Between the promos I’ve received, I’ve gotten groceries delivered for less than the items cost let alone the gas and time to deliver them. I’ve had multiple food items delivered at a lower cost than me walking there and buying in store as well. Talking to a few drivers for the companies - its tough, but they make a decent amount in the city (4-7k a month)
  • Ekaros 5y ago
    I think we will see crashes in food delivery eventually. As whole outside high margin items it doesn't make sense when you start to look at margin of restaurant, wage and operating costs of the delivery person and then the profit and cut for the platform, staffed by overpriced engineers, marketing people and executives...
    • alexashka 5y ago
      I don't know. Pizza delivery has been around longer than I've been alive. Why does that work?
      • Ekaros 5y ago
        As said it is high margin item. Many others don't deliver as well or have the margin making food delivery actually possible.
  • BoorishBears 5y ago
    I was you once, amazed at how badly the VCs had let me pull one over on them, and sure I'd stop if it became a bad deal. That was probably tens of thousands in spend on overpriced delivery meals making them huge profits off the initial "investment" they made in this customer Of course the promos dried up and the pricing became awful not too long into the process.
  • beepbooptheory 5y ago
    > its tough It is so tough, like beyond just the general psychological toll of your rent being a gamified award, there is little reprieve. No vacation, no security at all. I have had so many jobs, and being a GrubHub deliverer is perhaps the most alienating, and in long term, exhausting ones ive had. I used to think "well at least people can have flexible jobs, use their vehicles", but these days I just so no reason for labor to ever be like it for anyone. Its not a model that thinks about the actual worker at all.
• talkingtab 5y ago
  We do not have an economy built on disruption, we have an economy built on the myth of disruption. No better example than Theranos. And we have an economy built on lock-in. No better example that Apple, or perhaps Google and Amazon. These are both ways to extract value from the economic system, not ways to improve it. The Apple Tax, Google Adsense.
  • BoorishBears 5y ago
    That's an awful example being such an exceptional case, so maybe you should elaborate.
    • Apocryphon 5y ago
      What about WeWork then
      • BoorishBears 5y ago
        WeWork got heavily punished in pretty short order And to insert some other examples, Uber has taken a massive haircut, Zoom, etc. The reality is if you zoom in on a small window of time the market will always look irrational. But it all comes out in the wash once you zoom out, the companies of the .dot com boom that truly innovated were rewarded for example Amazon survived, created AWS, and look at them today.
  • nradov 5y ago
    It wasn't long ago that customers were locked in to IBM mainframes and DEC minicomputers. How did that work out? Eventually some new disruptive technology appears and the incumbents miss the market shift. https://en.wikipedia.org/wiki/The_Innovator%27s_Dilemma?wprov=sfla1 https://en.wikipedia.org/wiki/The_Innovator%27s_Dilemma?wpro...
  • qgin 5y ago
    The economy is built on companies like Theranos? That doesn’t seem right to me.
• toss1 5y ago
  >>you can make a business viable by pumping a lot of cash into it, you can actually crowd-out a lot of good businesses with bad, albeit well-funded ones. Yup And in most of the gig economy, it appears that that the only winning move is to not play. The exceptions are only certain circumstances such as where one can do arbitrage between economies, e.g., computing nomad living in a very low-cost economy but selling services in the US or EU. Otherwise, every account I've read of Uber/Lyft drivers is which way they are losing the most money after being lured in by promises of good income...
• kragen 5y ago
  Unpaywalled link: https://archive.fo/Kjl1d https://archive.fo/Kjl1d
• bregma 5y ago
  Both innovation and disruption are useful tools to keep in the chest. A completely free market economy is rife with undesirable downsides, so it's necessary to introduce regulation. Regulations in a capitalist system is rife with regulatory capture usually used to artificially restrict supply. Regulatory capture needs to be disrupted. Disruptors quickly become rent seekers (nice system... shame if something should happen to it). The way around disruptors is to innovate, until the capitalists seek to capture regulations on the innovative. It's a dynamic system constantly seeking equilibrium. It's not perfect but it seems to be working OK.
• datavirtue 5y ago
  Our lack of research funding in the US over the last few decades has been appalling. It makes no sense to pull back they way we did after making such wild gains on the back of it. Open source knowledge is literally the greatest thing since sliced bread. By some odd chance, a few people at Sun open-sourced Java and literally changed the world for the better. Look at the productivity and opportunity that is now available to everyone because of it. Look at how it spurred real competition and gave birth to new technology. It lit a fire under everyone's ass! One small example of how unleashing academic innovation can help lift everyone.
• Ambolia 5y ago
  Uber if anything makes taxis less productive and efficient, a big taxi company can take care car repairs in a very efficient way. The magic of Uber is taking those hidden costs and pushing them on the drivers, now the cars get fixed in a much less efficient way, but the ones taking the risk are the drivers, so Uber wins overall.
  • belval 5y ago
    I don't like Uber, but it became popular because of convenience, not because of costs. Pre-Uber/Lift in my city you'd have taxi companies that were operating like a cartel and giving a shitty service. Drivers were borderline rude. You had to call a dispatcher that was also usually rude and then wait 20 mins for a cab to show up. Uber changed that process for the best by actually allowing me to get a taxi from an app in 30 seconds, they usually showed up much faster and the driver, fearing a 4-stars review, is usually incentivized to at least keep their car clean. It's a game changer and I wouldn't go back. So no, the magic of Uber is not passing those hidden cost to the driver, it's actually offering a service that I want to use after +40 years of a corrupt industry that couldn't give a shit about improving. Now that Uber gave them a big scare, they actually improved, but the idea that they would have evolved without an existential threat is madness.
    • MrMan 5y ago
      the previous poster makes a very important point - Uber re-externalized the costs for fleet maintenance and many other costs and push them outside their balance sheet.
      • signatoremo 5y ago
        The flip side? They open up the pool of drivers substantially. Where I am it was impossible to get a taxi in the evening before Uber. Had I have access to Uber back then I wouldn’t need a car given my travel need. But I didn’t, so I had to get a car instead
      • belval 5y ago
        I don't deny the externalities of Uber, but the previous poster wrote: > Uber if anything makes taxis less productive and efficient Which is blatantly false. Taxi companies were pretty terrible and only got better because of competition. Getting in a taxi and having no idea how much it's going to cost me was a bad customer experience.
• ezekiel68 5y ago
  Disruptors: [maniacal laugh] "Or else, what?"
• JackFr 5y ago
  > In the US, food insecurity has become an epidemic on college campuses. Difficult to the article seriously when reading this. (And I did follow the link to read the academic paper referenced. Though I am not in the field, I thought it was terrible. By defining food insecurity down and needlessly conflating categories it attempts to make a real problem seem worse than it is by viewing it through an ill conceived lens.)
  • xhkkffbf 5y ago
    Agreed. And college campuses aren't exactly the most Uber-like place. While they experiment with online courses and some are really embracing them, the dominant vision is a pay-one-price, all-you-can-eat model. The colleges themselves bear plenty of similarities to the communist model thanks to need-based financial aid. So the fact that kids are food insecure on college campuses suggests that it's not a problem with Uberization or the economic model.
  • ac29 5y ago
    Yes, odd article. They define "Low food security" as "reports of reduced quality, variety, or desirability of diet". Which sounds like a typical college meal plan to me: not particularly interesting or high quality. Calling it an "epidemic" seems to be implying something much worse.
  • gamblor956 5y ago
    Yeah, comments like this are why so many people have turned against techies. A) There are plenty of students in the goldilocks zone of being from families to poor to afford a meal plan but too wealthy to qualify for free meals from their college. Some of these students are able to qualify for academic scholarships out of high school. The rest take on multiple jobs, including work-study, so that they can afford tuition and board. B) When college campuses shut down for COVID, many shut down their food halls as well, which affected those students poor enough to qualify for subsidized meals. Not everybody lives your life. Food insecurity is a real thing for thousands of college students.
    • musicale 5y ago
• adamqureshi 5y ago
  Back in the day my cousin was driving yellow cab in NYC. He would work 6/7 days a week 12 hour shifts. He eventually took our a mortgage ( loan) to buy a yellow cab medallion. Cost was like $1M. And BAM! uber came on the scene and the value for his medallion DROPPED. X 10k yellow cab drivers and those who bought medallions with a ridiculous loan. What did uBER do? that was so innovating? they simply put guys like my cousin OUT OF BUSINESS and underwater on their loans. WOW. Poor guy worked 20 years driving yellow cab and thought he would have a future buying medallions. Technology should enable rather than destroy people or slice up an industry to squeeze the lifers who've been in that industry their whole lives. Thats just 1 story of what happened in NYC when uber came on the scene. May not apply to ALL start ups i don't know. 2-cents.
  • deleted 5y ago
    [deleted]
  • autotech 5y ago
    Indeed, one of the things Uber disrupted was many lifelong taxi owner-operator’s retirement plans. An NYC taxi medallion was a valuable asset. It was a promise for exclusive market access. Giant $1M loans were taken out to pay for this privilege. NYC just turned around and gave it all away to Uber. When the value of NYC taxi medallions fell, while Uber was heavily subsidizing fares, small business owners were going bankrupt. Several people committed suicide. Real people lost their livelihoods while Kalinick and his buddies congratulated each other.
    • adamqureshi 5y ago
      Showtime made a show about uber" Super Pumped" on showtime rigth now. Apple made a movie about We Work ( Adam neuman). HULU made a show about Elizabeth Holms. "Theranos". Nobody made a movie about yellow taxi cab drivers who lost it all when their medallions went to the SH*T house after uBER decimation to the yellow cab medallion industry in NYC.
• Invictus0 5y ago
  Terrible article. How can you even write an article like this without understanding that disruption is a type of innovation?
• deleted 5y ago
  [deleted]
• giantg2 5y ago
  Life pretty comfortable. Most of the stuff that generates discomfort is stuff that a company/individual likely can't change. Innovation dies Negaunee we're fat and happy and there aren't any problems that feasibly solvable. For example, taxes. We already have tax software. It's still a pain. If we want to fix it, we have to fix the underlying government system of laws and regulation. Another one is healthcare. There is innovation there, but again the laws and regulations dictate or allow a lot of the negative behavior
• sobkas 5y ago
  I'm shocked. Under capitalism people with capital choose who will win in the market? How it's even possible? It's almost like that under capitalism people with capital make the rules.
• edanm 5y ago
  Here's what I don't get - why is the existence of Uber proof of anything? Yes, you're right, Uber is not particularly innovative. Neither is the pizza place down the corner. They're both a business that's trying to make money, albeit at different scale and via different products. But the existence of the pizza place doesn't prove that there aren't companies creating innovation. Neither does the existence of Uber.
  • Apocryphon 5y ago
    Perhaps there should be a study about how much of VC funding goes into companies that aim at “disruption” rather than “innovation.” If Uber, symbolizing the former, is more predominant over innovation companies, then the author has a point. Also see the entire economy is MoviePass now: https://news.ycombinator.com/item?id=17085538 https://news.ycombinator.com/item?id=17085538
• musicale 5y ago
  > The arrogance of Silicon Valley entrepreneurs seems so outrageous — and so childishly naive — that it is scarcely (sic) hard to believe. How could an industry that has produced so little in terms of productivity seem so sure that they’ve been “changing the world” for the better. Let's take one fabulously successful/wealthy/arrogant Silicon Valley company – Apple – which helped to improve and/or popularize: personal computers (Apple II), GUI computing (Macintosh), laser printing (LaserWriter), laptops (Power/i/MacBook), digital photography (QuickTake, iPhone), MP3 players (iPod), Wi-Fi (AirPort), smartphones (iPhone), app stores (App Store), tablets (iPad), smart watches (Apple watch), etc.. Silicon Valley also helped to create many beneficial advancements in the areas of: microprocessors, digital storage, the internet, the world wide web, video conferencing, digital and online games, streaming media, automatic translation, etc.. I would imagine that the author appreciates at least a few of these technologies and would not wish to give them up. Moreover, the claim that productivity has not been increased by computing and information technology seems to have been largely refuted: https://en.wikipedia.org/wiki/Productivity_paradox https://en.wikipedia.org/wiki/Productivity_paradox However, the claim that Google and Facebook are disruptors rather than innovators is interesting. I don't think he's talking about disrupting AltaVista and MySpace, but rather disrupting the sale of advertisements and media (newspapers, magazines) that depended on those ad sales.
• 1vuio0pswjnm7 5y ago
  This blog post seems quite a departure from the author's portrayal of Silicon Valley in his two most recent books. In the books he defines "innovation" as a novel solution to an important problem, but highlights that "important" is subjective. What one person think is important may be different from what another person thinks is important. This subjectivity is exemplified in the top comment in this thread. The commenter believes "AI/ML research" and cashierless checkout from a single company are examples of innovation. This confused thinking is perhaps a contributing reason that today's faux "innovation" is able to gain traction. The top comment believes research is innovation. Further, the important problem to be solved in the opinion of the commenter is the existence of cashiers, not, e.g., how to increase their productivity. Methods of increasing profits and solutions to important problems (=innovation) are not necessarily synonymous.
• hackernewds 5y ago
  This article seems to have a primal understanding of how complex it is to run a company as complex as Uber - narrowed only to think of innovations as physical hardware, or software innovations. Easy to forget, the complexity of getting from point A to B efficiently and economically around the globe - with trust established against an unknown driver.
• phendrenad2 5y ago
  Actual title: "How The “Uber Economy” Is Killing Innovation, Prosperity And Entrepreneurship" This article isn't about disruption, this article is about the gig economy.