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If it’s so bad why are people using it so much that they are profitable?

echelon 3y ago
It's still better than a taxi. Any trip to the airport, while traveling, when planning to drink, etc. is an Uber.
ineedasername 3y ago
Because they have driven some competition out of the market so alternatives can be hard to find, compared to pre-Uber days. So a person might say “See? If it’s easier to use Uber then they are providing more value.” Except the alternatives may have been better pre-Uber, therefore Uber only provides relative value now because they have downgraded the overall quality. This will vary quite a bit by location though. In areas where it had been difficult or highly inconvenient to get a cab pre-Uber then Uber may still provide actual value over prior status quo. I’ve experienced both situations.
- olalonde 3y ago
  I'm calling BS. If there was really a demand for it, the taxis would be back in no time. Operating a taxi is not rocket science nor does it require a huge capital investment.
  - ineedasername 3y ago
    Call BS all you want, but it takes time for markets to adjust. How long has Uber been around, and for how long has the current status quo in their decreased quality prevailed? It takes time for the market to respond, even when capital barriers are low things don’t turn on a dime. There’s enough risk involved that people aren’t sitting at their computers eagerly refreshing their browser for the merest hint that Uber customers are dissatisfied. But if you’re looking for evidence of people having enough dissatisfaction to look elsewhere you can find it. As I said, competition was driven out of the market, it just may not come back on the time scale that you think it should. For example, Lyft is inching upwards a few points in market share[1] albeit at the cost to their own bottom line. This is evidence I may be right, and as a result Lyft is attempting to take advantage of the situation I describe. While you, also correct that competitors would try to swoop in, are simply incorrect about the time scale. The dust hasn’t settled yet. “No time” as far as macroscopic market shifts go often starts very slowly, and then all at once. Of course I could be wrong, but I’m not sure you’ve demonstrated a compelling reason why I must or likely am wrong. My assessment stands, for the current state of affairs, but in a year or two the market could have shifted against Uber. Or maybe Uber will be agile enough to respond before things go to far. [1] https://www.reuters.com/business/autos-transportation/lyft-irks-wall-street-with-margin-sacrifice-race-with-uber-2023-05-05/ https://www.reuters.com/business/autos-transportation/lyft-i...
mdasen 3y ago
Things get bad slowly and it can be hard to notice at first. When companies slightly shrink their products or change to cheaper ingredients, most people don't immediately notice. To an extent, it's like the boiling frog analogy. You slowly raise the prices and lower the service expectations and people don't notice as easily. People also become dependent on things. Even when there are alternatives, people have habits and those habits are powerful. Uber doesn't have a monopoly, but they are usually a duopoly (with Lyft). It isn't easy to compare prices and services between. I hate saying that because if you are trolling, you're going to say "it's easy, you just open both apps", but it's not easy since the pricing is always shifting and with drivers canceling or pushing you to cancel it becomes problematic. Uber's brand and one's history with the service can leave one hesitant to believe it is now bad. Maybe a few times you think "oh, it's just a couple bad experiences." Historically, you have more positive experiences to balance it out. Many people will want to write off these bad experiences because they've talked up Uber a lot in the past. They don't want the cognitive dissonance of thinking "wow, I was an idiot to buy into their bait-and-switch and get all my friends to buy into it!" They'd rather believe that the service hasn't gotten that much worse and that they still like it. ----- We see this kind of thing in a lot of areas. If Google Search is so bad, why are so many people using it so much that it's so profitable? Again, many of the same things: it becomes bad slowly over time and people don't notice it so much; people become dependent on things and use Google as a habit without even thinking about available alternatives - it's the default search in their browser just as Uber is the app they have installed; while Google doesn't have a monopoly, there aren't many alternatives and yea you could just run your search twice in two search engines, but people aren't going to do even seemingly "easy" things to compare or get better results; and Google has a brand associated with search quality that people have pushed forward over a couple decades and people don't like changing their beliefs around that. We can't make truly free decisions. We don't have a situation where one could say, "If Uber isn't serving you well, you could just make your own transportation network that treated you better and use that." That's not so possible. We're often left without truly free choices because we live in a society where certain things exist and other things don't and we can't rebuild things overnight when something isn't great. Lots of companies make lots of money while providing bad service because they're using their market position to gain leverage. If your logic is "so many people are using it, therefore it must be good," that really ignores how companies use their market position to leverage more profits because people don't really have choice.
networkchad 3y ago
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It's still better than a taxi. Any trip to the airport, while traveling, when planning to drink, etc. is an Uber.

Because they have driven some competition out of the market so alternatives can be hard to find, compared to pre-Uber days. So a person might say “See? If it’s easier to use Uber then they are providing more value.” Except the alternatives may have been better pre-Uber, therefore Uber only provides relative value now because they have downgraded the overall quality. This will vary quite a bit by location though. In areas where it had been difficult or highly inconvenient to get a cab pre-Uber then Uber may still provide actual value over prior status quo. I’ve experienced both situations.

olalonde 3y ago
I'm calling BS. If there was really a demand for it, the taxis would be back in no time. Operating a taxi is not rocket science nor does it require a huge capital investment.
- ineedasername 3y ago
  Call BS all you want, but it takes time for markets to adjust. How long has Uber been around, and for how long has the current status quo in their decreased quality prevailed? It takes time for the market to respond, even when capital barriers are low things don’t turn on a dime. There’s enough risk involved that people aren’t sitting at their computers eagerly refreshing their browser for the merest hint that Uber customers are dissatisfied. But if you’re looking for evidence of people having enough dissatisfaction to look elsewhere you can find it. As I said, competition was driven out of the market, it just may not come back on the time scale that you think it should. For example, Lyft is inching upwards a few points in market share[1] albeit at the cost to their own bottom line. This is evidence I may be right, and as a result Lyft is attempting to take advantage of the situation I describe. While you, also correct that competitors would try to swoop in, are simply incorrect about the time scale. The dust hasn’t settled yet. “No time” as far as macroscopic market shifts go often starts very slowly, and then all at once. Of course I could be wrong, but I’m not sure you’ve demonstrated a compelling reason why I must or likely am wrong. My assessment stands, for the current state of affairs, but in a year or two the market could have shifted against Uber. Or maybe Uber will be agile enough to respond before things go to far. [1] https://www.reuters.com/business/autos-transportation/lyft-irks-wall-street-with-margin-sacrifice-race-with-uber-2023-05-05/ https://www.reuters.com/business/autos-transportation/lyft-i...

mdasen 3y ago

Things get bad slowly and it can be hard to notice at first. When companies slightly shrink their products or change to cheaper ingredients, most people don't immediately notice. To an extent, it's like the boiling frog analogy. You slowly raise the prices and lower the service expectations and people don't notice as easily. People also become dependent on things. Even when there are alternatives, people have habits and those habits are powerful. Uber doesn't have a monopoly, but they are usually a duopoly (with Lyft). It isn't easy to compare prices and services between. I hate saying that because if you are trolling, you're going to say "it's easy, you just open both apps", but it's not easy since the pricing is always shifting and with drivers canceling or pushing you to cancel it becomes problematic. Uber's brand and one's history with the service can leave one hesitant to believe it is now bad. Maybe a few times you think "oh, it's just a couple bad experiences." Historically, you have more positive experiences to balance it out. Many people will want to write off these bad experiences because they've talked up Uber a lot in the past. They don't want the cognitive dissonance of thinking "wow, I was an idiot to buy into their bait-and-switch and get all my friends to buy into it!" They'd rather believe that the service hasn't gotten that much worse and that they still like it. ----- We see this kind of thing in a lot of areas. If Google Search is so bad, why are so many people using it so much that it's so profitable? Again, many of the same things: it becomes bad slowly over time and people don't notice it so much; people become dependent on things and use Google as a habit without even thinking about available alternatives - it's the default search in their browser just as Uber is the app they have installed; while Google doesn't have a monopoly, there aren't many alternatives and yea you could just run your search twice in two search engines, but people aren't going to do even seemingly "easy" things to compare or get better results; and Google has a brand associated with search quality that people have pushed forward over a couple decades and people don't like changing their beliefs around that. We can't make truly free decisions. We don't have a situation where one could say, "If Uber isn't serving you well, you could just make your own transportation network that treated you better and use that." That's not so possible. We're often left without truly free choices because we live in a society where certain things exist and other things don't and we can't rebuild things overnight when something isn't great. Lots of companies make lots of money while providing bad service because they're using their market position to gain leverage. If your logic is "so many people are using it, therefore it must be good," that really ignores how companies use their market position to leverage more profits because people don't really have choice.

networkchad 3y ago

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