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I don't get the endgame here. Uber provides super cheap cab rides by going into a loss so competitors don't spring up. then eventually when they've dominated th

I don't get the endgame here. Uber provides super cheap cab rides by going into a loss so competitors don't spring up. then eventually when they've dominated the market they do what? increase prices? so competitors spring up again? makes no sense

Eji1700 4y ago
Regulatory capture most likely. As shitty as cabs were, they also had regulations to follow (in theory). Sooo they'll do something similar. Lock up the market, do all the suuuper unethical political junk they're known form, and make it impossible for anyone to compete with them. THEN they'll jack up the prices.
- thriftwy 4y ago
  That's not very bright proposition. Suppose they have captured the market regulatorily and jacked up prices. Sure they have defended from new start-ups. What would prevent a big player such as Amazon or Meta from entering their market? They can surely afford to allocate tens of billions to do so. They can also hire an expensive team of lawyers and execs to enter this regulated market.
incrudible 4y ago
The idea is that Uber will develop a self-driving car that will ultimately offset its loss leader, much like Amazon and AWS.
- semiquaver 4y ago
  That was the idea once; They gave up on that part, their self driving car division has been shuttered and they don’t plan to replace it. From the article: > Uber's bag of tricks is nearing its bottom. Its fantasy of magic, self-driving robo-taxis is over (the company spent $2.5b to make a car that had a fatal crash every 0.25 miles, and then had to pay another company $400m to take the division off its hands): > https://pluralistic.net/2020/12/08/required-reading/#goober
  - bigDinosaur 4y ago
    Huh. A piece of news perhaps many missed due to other events overshadowing it completely? I had no idea.
  - preommr 4y ago
    2.5b seems like a drop in the bucket for what would essentialy revolutionize the world of transportation.
    - antisthenes 4y ago
      Not when competitors are achieving better results with less. The first to full vehicle autonomy will reap the majority of the rewards and market share. Also, we'll never really know the exact numbers and how much of it went to actual R&D and miles-driven testing.
- xuki 4y ago
  Now this has been proven a pipe dream, I really don't understand the current valuation of Uber.
amelius 4y ago
There is no end game. It's a pump and dump scheme. Early investors get insanely rich, whereas later investors pay the price.
- potamic 4y ago
  I wonder if part of the root cause is allowing non profitable companies to list publicly. For early investors, listing is the end game and not having profitability as a goal means investors are more incentivized to grow hype than in sustaining the business.
  - Ekaros 4y ago
    I don't think there is anything wrong with unprofitable companies getting to list. Problem is the investors. That there are enough people both private and institutional that even consider buying an company that has and does not generate profit. And even more so does not seem viable route to such. Maybe fund managers should not be allowed to invest in such companies. At least outside qualified investors.
mytailorisrich 4y ago
End game of taxi industry is self-driving cars. This is what Uber has been betting on but they estimated that the transition would come much earlier than it is.
- manderley 4y ago
  If that were the end-goal, what's the point of operating their current business at all? Seems like a waste and entirely pointless. And why wouldn't some other company without all the current baggage needed for operating a taxi service with human drivers be able to steal Uber's business?
slaw 4y ago
Uber is not profitable and DiDi which takes less cut as middle man is profitable. In Central and South America, I prefer to use DiDi as it is cheaper and app experience is about the same. https://www.forbes.com/sites/bradtempleton/2021/02/04/didi-makes-1-billion-profit-while-uber-bleeds---good-news-for-robotaxis https://www.forbes.com/sites/bradtempleton/2021/02/04/didi-m...

Eji1700 4y ago

Regulatory capture most likely. As shitty as cabs were, they also had regulations to follow (in theory). Sooo they'll do something similar. Lock up the market, do all the suuuper unethical political junk they're known form, and make it impossible for anyone to compete with them. THEN they'll jack up the prices.

thriftwy 4y ago
That's not very bright proposition. Suppose they have captured the market regulatorily and jacked up prices. Sure they have defended from new start-ups. What would prevent a big player such as Amazon or Meta from entering their market? They can surely afford to allocate tens of billions to do so. They can also hire an expensive team of lawyers and execs to enter this regulated market.

incrudible 4y ago

The idea is that Uber will develop a self-driving car that will ultimately offset its loss leader, much like Amazon and AWS.

semiquaver 4y ago
That was the idea once; They gave up on that part, their self driving car division has been shuttered and they don’t plan to replace it. From the article: > Uber's bag of tricks is nearing its bottom. Its fantasy of magic, self-driving robo-taxis is over (the company spent $2.5b to make a car that had a fatal crash every 0.25 miles, and then had to pay another company $400m to take the division off its hands): > https://pluralistic.net/2020/12/08/required-reading/#goober
- bigDinosaur 4y ago
  Huh. A piece of news perhaps many missed due to other events overshadowing it completely? I had no idea.
- preommr 4y ago
  2.5b seems like a drop in the bucket for what would essentialy revolutionize the world of transportation.
  - antisthenes 4y ago
    Not when competitors are achieving better results with less. The first to full vehicle autonomy will reap the majority of the rewards and market share. Also, we'll never really know the exact numbers and how much of it went to actual R&D and miles-driven testing.
xuki 4y ago
Now this has been proven a pipe dream, I really don't understand the current valuation of Uber.

amelius 4y ago

There is no end game. It's a pump and dump scheme. Early investors get insanely rich, whereas later investors pay the price.

potamic 4y ago
I wonder if part of the root cause is allowing non profitable companies to list publicly. For early investors, listing is the end game and not having profitability as a goal means investors are more incentivized to grow hype than in sustaining the business.
- Ekaros 4y ago
  I don't think there is anything wrong with unprofitable companies getting to list. Problem is the investors. That there are enough people both private and institutional that even consider buying an company that has and does not generate profit. And even more so does not seem viable route to such. Maybe fund managers should not be allowed to invest in such companies. At least outside qualified investors.

mytailorisrich 4y ago

End game of taxi industry is self-driving cars. This is what Uber has been betting on but they estimated that the transition would come much earlier than it is.

manderley 4y ago
If that were the end-goal, what's the point of operating their current business at all? Seems like a waste and entirely pointless. And why wouldn't some other company without all the current baggage needed for operating a taxi service with human drivers be able to steal Uber's business?

slaw 4y ago

Uber is not profitable and DiDi which takes less cut as middle man is profitable. In Central and South America, I prefer to use DiDi as it is cheaper and app experience is about the same. https://www.forbes.com/sites/bradtempleton/2021/02/04/didi-makes-1-billion-profit-while-uber-bleeds---good-news-for-robotaxis https://www.forbes.com/sites/bradtempleton/2021/02/04/didi-m...