One hypothesis could be Uber can't raise their fares if there's significant competition and outside options. That is, if Uber were to take a higher margin cut,

One hypothesis could be Uber can't raise their fares if there's significant competition and outside options. That is, if Uber were to take a higher margin cut, others would undercut be able Uber. Overtime, each competitor would be subject to the same sanctions and maintain depressed margins in the highly competitive market.