4 ms·

>subsidizing the price of their products until users couldn't live without them A good, more succinct way to describe the bait and switch scheme uber, airbnb e

>subsidizing the price of their products until users couldn't live without them A good, more succinct way to describe the bait and switch scheme uber, airbnb etc have performed in their respective markets

DragonStrength 3y ago
Classic monopoly behavior w/o the monopoly: run competitors out of business with cheaper, better service then provide more expensive, worse service once the existing players are bankrupt. Calling them "start ups" and ignoring the major money backing them shouldn't change the equation.
- ChadNauseam 3y ago
  Without the monopoly, it’s not really problematic though. Ironically, this accusation. is almost always levied against Uber, which is not a monopoly, better than the competition, and competing with a monopoly! The taxicab monopoly was part of the reason prices were high and service was bad
  - hgsgm 3y ago
    Taxicabs only had a monopoly (not exact the right word, but a constrained market) in a few cities.
  - danaris 3y ago
    It's problematic because it is explicitly intended to make them a monopoly. When you run competitors out of business, you...don't have competition. Competition is what keeps a market healthy.
- Sohcahtoa82 3y ago
  > then provide more expensive, worse service I like how the term "enshittification" got coined to describe this.
eropple 3y ago
That they got away with the term "blitzscaling" still offends me. We had a plenty-adequate term for it before: dumping. When your business model is "profit margins are for after we've killed or neutered all competitors", you don't have a business and that fundamentally shouldn't be permitted for a healthy economy.
- pydry 3y ago
  Predatory pricing is the the general term. Dumping is predatory pricing done in the context of international trade. IIRC theres a page on the FTC website which condescendingly explains that while predatory pricing can theoretically exist in practice it's vanishingly rare and you can basically just assume it doesnt happen. So there you go. Hear no evil see no evil.
  - eropple 3y ago
    I used the term dumping specifically, because (to my understanding, and hectored at by an econ professor once who made it stick) it refers to trade out-of-your-home-market rather than purely "international trade"--and what 'home market' is is, itself, a thing for debate. If you parachute in with enormous sacks with dollar signs on them from Silicon Valley and engage in deep predatory pricing in other cities and states both within your country and without, I'm comfortable calling it dumping. Your other point wrt the FTC is, well...womp womp.
    - pydry 3y ago
      Every definition ive ever seen including the wikipedia page is pretty clear about it being specific to international trade and thats how Ive always understood it.
  - hgsgm 3y ago
    Your memory is hyperbolic. https://www.ftc.gov/advice-guidance/competition-guidance/guide-antitrust-laws/single-firm-conduct/predatory-or-below-cost-pricing https://www.ftc.gov/advice-guidance/competition-guidance/gui...
steveBK123 3y ago
Yeah it's funny how for example, Uber kind of followed a curve. It started out, in NYC at least, as a luxury "black car" replacement. Then it got flooded with the cheaper tiers, and it was hard to understand how anyone was making money - the drivers, the company etc. And they weren't! Now its more expensive than ever and generally far cheaper to get a yellow cab again.
- ChadNauseam 3y ago
  The drivers were obviously making money, or they wouldn’t be driving
  - spaceman_2020 3y ago
    “The slaves must obviously be happy, or they wouldn’t be singing songs”
    - treis 3y ago
      There's no masters with whips forcing Uber drivers to drive.
      - asadotzler 3y ago
        Actually, yes, there are. They're called landlords and health insurance companies. When your literal life is in someone else's hands, you do what you need to satisfy them.
        treis 3y ago
        That's not the same as being owned as literal property. Don't be ridiculous.
  - fullshark 3y ago
    Potentially they were/are trading long term depreciation on their vehicle, as well as the opportunity cost of working for a traditional employer for short term cash infusions and not really making any money.
Spivak 3y ago
I don't get this, none of Uber, Lyft, AirBnb, Vrbo, Hellofresh, Blueapron DoorDash, Postmates, Casper, Instacart, Carvana have driven their competition out of business and people are still choosing them. It costs nothing all all to not use them and you at all times could have switched back to whatever you did before.

DragonStrength 3y ago

Classic monopoly behavior w/o the monopoly: run competitors out of business with cheaper, better service then provide more expensive, worse service once the existing players are bankrupt. Calling them "start ups" and ignoring the major money backing them shouldn't change the equation.

ChadNauseam 3y ago
Without the monopoly, it’s not really problematic though. Ironically, this accusation. is almost always levied against Uber, which is not a monopoly, better than the competition, and competing with a monopoly! The taxicab monopoly was part of the reason prices were high and service was bad
- hgsgm 3y ago
  Taxicabs only had a monopoly (not exact the right word, but a constrained market) in a few cities.
- danaris 3y ago
  It's problematic because it is explicitly intended to make them a monopoly. When you run competitors out of business, you...don't have competition. Competition is what keeps a market healthy.
Sohcahtoa82 3y ago
> then provide more expensive, worse service I like how the term "enshittification" got coined to describe this.

eropple 3y ago

That they got away with the term "blitzscaling" still offends me. We had a plenty-adequate term for it before: dumping. When your business model is "profit margins are for after we've killed or neutered all competitors", you don't have a business and that fundamentally shouldn't be permitted for a healthy economy.

pydry 3y ago
Predatory pricing is the the general term. Dumping is predatory pricing done in the context of international trade. IIRC theres a page on the FTC website which condescendingly explains that while predatory pricing can theoretically exist in practice it's vanishingly rare and you can basically just assume it doesnt happen. So there you go. Hear no evil see no evil.
- eropple 3y ago
  I used the term dumping specifically, because (to my understanding, and hectored at by an econ professor once who made it stick) it refers to trade out-of-your-home-market rather than purely "international trade"--and what 'home market' is is, itself, a thing for debate. If you parachute in with enormous sacks with dollar signs on them from Silicon Valley and engage in deep predatory pricing in other cities and states both within your country and without, I'm comfortable calling it dumping. Your other point wrt the FTC is, well...womp womp.
  - pydry 3y ago
    Every definition ive ever seen including the wikipedia page is pretty clear about it being specific to international trade and thats how Ive always understood it.
- hgsgm 3y ago
  Your memory is hyperbolic. https://www.ftc.gov/advice-guidance/competition-guidance/guide-antitrust-laws/single-firm-conduct/predatory-or-below-cost-pricing https://www.ftc.gov/advice-guidance/competition-guidance/gui...

steveBK123 3y ago

Yeah it's funny how for example, Uber kind of followed a curve. It started out, in NYC at least, as a luxury "black car" replacement. Then it got flooded with the cheaper tiers, and it was hard to understand how anyone was making money - the drivers, the company etc. And they weren't! Now its more expensive than ever and generally far cheaper to get a yellow cab again.

ChadNauseam 3y ago
The drivers were obviously making money, or they wouldn’t be driving
- spaceman_2020 3y ago
  “The slaves must obviously be happy, or they wouldn’t be singing songs”
  - treis 3y ago
    There's no masters with whips forcing Uber drivers to drive.
    - asadotzler 3y ago
      Actually, yes, there are. They're called landlords and health insurance companies. When your literal life is in someone else's hands, you do what you need to satisfy them.
      - treis 3y ago
        That's not the same as being owned as literal property. Don't be ridiculous.
- fullshark 3y ago
  Potentially they were/are trading long term depreciation on their vehicle, as well as the opportunity cost of working for a traditional employer for short term cash infusions and not really making any money.

Spivak 3y ago

I don't get this, none of Uber, Lyft, AirBnb, Vrbo, Hellofresh, Blueapron DoorDash, Postmates, Casper, Instacart, Carvana have driven their competition out of business and people are still choosing them. It costs nothing all all to not use them and you at all times could have switched back to whatever you did before.