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Saying the barriers to entry or low is completely uninformed. The incumbent has a massive advantage in driver/rider liquidity that is nearly impossible to overc
by pbreit 11y ago
Saying the barriers to entry or low is completely uninformed. The incumbent has a massive advantage in driver/rider liquidity that is nearly impossible to overcome. Lyft is the perfect example in that it still massively trails Uber in every one of its markets despising having very deep pockets and for many, a more attractive product.
- Retric 11y agoIMO, Lyft's mistake is attacking more than one market at the same time. Spending 100M to just get NY is a good investment and there are far smaller cities out there with lower barriers to entry. Further, if you can demonstrate that Uber only raises rates after they show up you can build up a lot of hate in the driver’s community. AKA: Uber pays a lot to get ex: NYC and LA drivers, wins both markets, lowers payouts to make money. New competitor shows up in NYC so Uber dramatically raises rates in NYC and not LA. Then, before that competitor moves to LA a lot of drivers are going to get pissed there stuck with low rates. Basically, by attacking one city, Uber is forced to either raise rates in all its cities’ which it can't afford or piss off all their drivers.