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Seems like they took the foot off the gas over the past year and let Uber push them around. It’s hard being number two in a “winner takes all” market with such

Seems like they took the foot off the gas over the past year and let Uber push them around. It’s hard being number two in a “winner takes all” market with such strong network effects.

DANmode 4y ago
https://secondmeasure.com/datapoints/rideshare-industry-overview/ https://secondmeasure.com/datapoints/rideshare-industry-over...
bsder 4y ago
There is no "winner takes all." There is "subsidize the market until you drive out all the competition and hope you can raise to monopoly prices afterward." And more money just got expensive. So, Lyft and Uber are locked in a Catch 22 death embrace until one (or both) collapses.
- toomuchtodo 4y ago
  India’s new non profit government sponsored commerce facilitator ONDC is something to follow in this space. Like UPI, but for meatspace logistics vs instant payments and charging substantially less than Uber and Lyft (3% vs 30%, broadly speaking). If successful, I expect the model to spread vs “Big Tech Boom and Capture”. https://finance.yahoo.com/news/zero-commission-ride-hailing-india-122409427.html https://finance.yahoo.com/news/zero-commission-ride-hailing-... https://fortune.com/2022/08/02/why-india-could-single-handedly-shape-the-future-of-e-commerce-this-summer-vivek-wadhwa-alex-salkever/ https://fortune.com/2022/08/02/why-india-could-single-handed... https://ondc.org/ https://ondc.org/
  - itake 4y ago
    My sense is these low-fee competitors are hiring the drivers that were banned by the main players for safety violations (murder, theft, etc.). The smaller competitors are low-cost because they lack the support and safety features that add friction (and cost) to the primary players.
    - deleted 4y ago
      [deleted]
    - kennyloginz 4y ago
      Wait, murder, really?
      - itake 4y ago
        You can search "Uber murders" and lots of articles pop up. Criminals ask strangers to book rides for them and then rob the captive driver (or signup as drivers and use the app to find victims). Uber was famous a few years ago for allowing anyone with a driver's license on the platform with no background checks. Uber is definitely past that phase in their business, the smaller players are unfortunately not.
      - toomuchtodo 4y ago
        OP has a conflict of interest, leading to a hint of bias, resulting in an ever so sleight amount of hyperbole mentioned.
        itake 4y ago
        Yes, I work for a ride-share company that operates in a developing country. I am not sure what hyperbole you're thinking I am referencing. If it's the part about murders, you can find many news articles about Uber when you search "Uber murder". This is a problem that all ride-share companies face.
        toomuchtodo 4y ago
        Yes, I don’t disagree that these events occur, I disagree with your assertion that hiring these folks is why competitors can offer lower cost models. It’s because they’re more cost efficient.
        itake 4y ago
        Yes... they are more cost-efficient because they skip on background checks, safety tech (like face recognition ban lists, on-ground safety crews for investigating crimes, audio recording, etc.), and support operations. They also have access to more drivers, because they will hire the drivers that were banned by the big guys.
- itake 4y ago
  Lyft has $1.8 billion [0] and Uber has $4.3b [1] at December 31, 2022 cash on hand. Where is the death embrace? [0] - https://investor.lyft.com/news-and-events/news/news-details/2023/Lyft-Announces-Q422-and-Fiscal-2022-Results/default.aspx https://investor.lyft.com/news-and-events/news/news-details/... [1] - https://investor.uber.com/news-events/news/press-release-details/2023/Uber-Announces-Results-for-Fourth-Quarter-and-Full-Year-2022/default.aspx https://investor.uber.com/news-events/news/press-release-det...
  - LegitShady 4y ago
    I don't think either company has turned a profit in the last 5 years at least. They're just spending VC money to try to kill the competition. That $4.3 and $1.8 billion isn't from profit, its from VC's trying to outspend each other.
    - bydlocoder 4y ago
      I don't get their strategy. While they are an true tech company - the marginal cost of servicing next client is essentially zero, their network effect is limited to a single city so it will be easy for potential competitors to enter the market.
  - bydlocoder 4y ago
    Their products were feature-complete a long time ago. Why are they still in a growth stage and not making profit which should be easy for essentially brokers?

Seems like they took the foot off the gas over the past year and let Uber push them around. It’s hard being number two in a “winner takes all” market with such strong network effects.

DANmode 4y ago

https://secondmeasure.com/datapoints/rideshare-industry-overview/ https://secondmeasure.com/datapoints/rideshare-industry-over...

bsder 4y ago

There is no "winner takes all." There is "subsidize the market until you drive out all the competition and hope you can raise to monopoly prices afterward." And more money just got expensive. So, Lyft and Uber are locked in a Catch 22 death embrace until one (or both) collapses.

toomuchtodo 4y ago
India’s new non profit government sponsored commerce facilitator ONDC is something to follow in this space. Like UPI, but for meatspace logistics vs instant payments and charging substantially less than Uber and Lyft (3% vs 30%, broadly speaking). If successful, I expect the model to spread vs “Big Tech Boom and Capture”. https://finance.yahoo.com/news/zero-commission-ride-hailing-india-122409427.html https://finance.yahoo.com/news/zero-commission-ride-hailing-... https://fortune.com/2022/08/02/why-india-could-single-handedly-shape-the-future-of-e-commerce-this-summer-vivek-wadhwa-alex-salkever/ https://fortune.com/2022/08/02/why-india-could-single-handed... https://ondc.org/ https://ondc.org/
- itake 4y ago
  My sense is these low-fee competitors are hiring the drivers that were banned by the main players for safety violations (murder, theft, etc.). The smaller competitors are low-cost because they lack the support and safety features that add friction (and cost) to the primary players.
  - deleted 4y ago
    [deleted]
  - kennyloginz 4y ago
    Wait, murder, really?
    - itake 4y ago
      You can search "Uber murders" and lots of articles pop up. Criminals ask strangers to book rides for them and then rob the captive driver (or signup as drivers and use the app to find victims). Uber was famous a few years ago for allowing anyone with a driver's license on the platform with no background checks. Uber is definitely past that phase in their business, the smaller players are unfortunately not.
    - toomuchtodo 4y ago
      OP has a conflict of interest, leading to a hint of bias, resulting in an ever so sleight amount of hyperbole mentioned.
      - itake 4y ago
        Yes, I work for a ride-share company that operates in a developing country. I am not sure what hyperbole you're thinking I am referencing. If it's the part about murders, you can find many news articles about Uber when you search "Uber murder". This is a problem that all ride-share companies face.
        toomuchtodo 4y ago
        Yes, I don’t disagree that these events occur, I disagree with your assertion that hiring these folks is why competitors can offer lower cost models. It’s because they’re more cost efficient.
        itake 4y ago
        Yes... they are more cost-efficient because they skip on background checks, safety tech (like face recognition ban lists, on-ground safety crews for investigating crimes, audio recording, etc.), and support operations. They also have access to more drivers, because they will hire the drivers that were banned by the big guys.
itake 4y ago
Lyft has $1.8 billion [0] and Uber has $4.3b [1] at December 31, 2022 cash on hand. Where is the death embrace? [0] - https://investor.lyft.com/news-and-events/news/news-details/2023/Lyft-Announces-Q422-and-Fiscal-2022-Results/default.aspx https://investor.lyft.com/news-and-events/news/news-details/... [1] - https://investor.uber.com/news-events/news/press-release-details/2023/Uber-Announces-Results-for-Fourth-Quarter-and-Full-Year-2022/default.aspx https://investor.uber.com/news-events/news/press-release-det...
- LegitShady 4y ago
  I don't think either company has turned a profit in the last 5 years at least. They're just spending VC money to try to kill the competition. That $4.3 and $1.8 billion isn't from profit, its from VC's trying to outspend each other.
  - bydlocoder 4y ago
    I don't get their strategy. While they are an true tech company - the marginal cost of servicing next client is essentially zero, their network effect is limited to a single city so it will be easy for potential competitors to enter the market.
- bydlocoder 4y ago
  Their products were feature-complete a long time ago. Why are they still in a growth stage and not making profit which should be easy for essentially brokers?