Uber

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vinsanity
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Re: Uber

Post by vinsanity »

Joe Shlabotnik wrote:Again, this is not rocket science. You could make it work. In fact, you could be the entrepreneur that builds the platform that gets licensed to cities for their use.
I didn't say it was rocket science but if it was so easy and profitable, it would already have been done.

I've been in mobile development for 8 years and a lot of the performance and platform issues are more difficult than you're giving credit for. For instance, I work with the company that built HBO Now. It was season 6 or 7 of the Game of Thrones preview when HBO Go crashed a ~3 million views while HBO Now was running over ~7 million concurrent views without an issue. Just because it isn't rocket science and it can be copied doesn't mean all of the performance or features will be on par with existing solutions.

Uber was founded 10 years ago. They've been in Indianapolis since at least 2014; 5-7 years of testing helps smooth out a lot of software issues a few junior developers won't be able to just straight copy. It's certainly not impossible but it's not as simple as starting a company, hiring 4 android devs, 4 iOS devs, and 6 web devs to just build a white label solution for taxi's on demand and then start selling to cities. Even if you did that, after the first city bought a license, before you could close the next deal Uber or Lyft would just turn on the same functionality and underbid you with a better product for the next city.

It's not rocket science but there are a lot of hurdles and hiccups that would make it a difficult solution to market.

Arthur Dent
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Re: Uber

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Uber’s innovation has almost nothing to do with their software. They got market by being ultra aggressive in busting local taxi regulations. And now that they’re established with a bunch of drivers working for them and a bunch of users who already use the app, it will take more than simply introducing an alternative to dislodge them but not because their software is unbeatable.

The main problem with dislodging them is that they’ve fooled investors into using their dollars to subsidize every ride, which a public or driver-owned alternative is unlikely to be able to do.

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Re: Uber

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Arthur Dent wrote:Uber’s innovation has almost nothing to do with their software. They got market by being ultra aggressive in busting local taxi regulations. And now that they’re established with a bunch of drivers working for them and a bunch of users who already use the app, it will take more than simply introducing an alternative to dislodge them but not because their software is unbeatable.

The main problem with dislodging them is that they’ve fooled investors into using their dollars to subsidize every ride, which a public or driver-owned alternative is unlikely to be able to do.
This is very true. It's actually a huge problem for Uber because their tech doesn't really create any groundbreaking efficiencies. As they continue expand they can't lower their expenses via economies of scale. Meaning, most of their costs are the actual car rides, so as they grow those costs grow proportionally as well. That's the opposite of how most successful tech companies disrupt markets. Consequently, Uber desperately needs self driving car tech in order to reduce their main cost, labor. It's the only way they can really deliver profitability to justify their stock valuation. That's why I'm extremely bearish on Uber's future. Once self driving car tech matures I expect a lot of new competitors (including public and driver-owned) because the actual Uber tech is fairly straightforward and isn't a huge barrier to entry.

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Re: Uber

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Michael wrote:Consequently, Uber desperately needs self driving car tech in order to reduce their main cost, labor. It's the only way they can really deliver profitability to justify their stock valuation. That's why I'm extremely bearish on Uber's future. Once self driving car tech matures I expect a lot of new competitors (including public and driver-owned) because the actual Uber tech is fairly straightforward and isn't a huge barrier to entry.
Which is totally insane given that self-driving cars don’t exist and won’t be viable any time soon. Doing current subsidies on the theory that it will get you the totally hypothetical self driving market is just nuts, and it’s a real testament to how dumb and irrational the stock market is that this promise seems to work. Even in the unlikely event that self-driving car development has positive surprises so that it is viable sooner than current trends suggest, as you say, it seems pretty unlikely Uber can actually claim this market.

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Re: Uber

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Self driving cars was not even their original pitch to investors. It's what you see now. They've (correctly) shifted their strategy because they now realize the current business model is a dead-end. To me Uber is a zombie company that's too big to fail, so people keep acting like it's something special. Even now they're incurring lobbying expenses for law changes that their eventual competitors will benefit from. Outside of massively subsidizing rides there's very little they can do to differentiate themselves. From my perspective it's all very cray cray.

Business schools will be studying Uber for years.
Last edited by Michael on September 13 19, 12:38 pm, edited 1 time in total.

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BottenFieldofDreams
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Re: Uber

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But the disgraced founder is a zillionaire. I think the unofficial Silicon Valley model is to just have a plausible idea and some sales skills. Uber is a sieve. How are these escooter companies ever going to make money? Get your cash and let someone else worry about ever being profitable. There's probably a blog somewhere cataloging the SV millionaires whos vision amounted to nothing. I'd like to see it.

Did work for Amazon though, I guess. Pretty well.

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Re: Uber

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BottenFieldofDreams wrote:But the disgraced founder is a zillionaire. I think the unofficial Silicon Valley model is to just have a plausible idea and some sales skills. Uber is a sieve. How are these escooter companies ever going to make money? Get your cash and let someone else worry about ever being profitable. There's probably a blog somewhere cataloging the SV millionaires whos vision amounted to nothing. I'd like to see it.

Did work for Amazon though, I guess. Pretty well.
I understand the cynicism, but most successful tech start-ups have brought genuine efficiencies or groundbreaking life improvements.

Uber is basically a taxi company with a simple app and inexpensive rides. The low cost is mainly due to their unsustainable ride subsidization.

One of these things is not like the others.

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lukethedrifter
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Re: Uber

Post by lukethedrifter »

Michael wrote:
BottenFieldofDreams wrote:But the disgraced founder is a zillionaire. I think the unofficial Silicon Valley model is to just have a plausible idea and some sales skills. Uber is a sieve. How are these escooter companies ever going to make money? Get your cash and let someone else worry about ever being profitable. There's probably a blog somewhere cataloging the SV millionaires whos vision amounted to nothing. I'd like to see it.

Did work for Amazon though, I guess. Pretty well.
I understand the cynicism, but most successful tech start-ups have brought genuine efficiencies or groundbreaking life improvements.

Uber is basically a taxi company with a simple app and inexpensive rides. The low cost is mainly due to their unsustainable ride subsidization.

One of these things is not like the others.
Is this so? Sure seems like a huge pct are just snake oil sales jobs. Not to be a Luddite because i enjoy many of these so-called improvements but it (again) seems that they’re mostly a tech version of outsourcing. Maybe things get cheaper; does life improve overall?

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33anda3rd
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Re: Uber

Post by 33anda3rd »

Michael wrote:Self driving cars was not even their original pitch to investors. It's what you see now. They've (correctly) shifted their strategy because they now realize the current business model is a dead-end. To me Uber is a zombie company that's too big to fail, so people keep acting like it's something special. Even now they're incurring lobbying expenses for law changes that their eventual competitors will benefit from. Outside of massively subsidizing rides there's very little they can do to differentiate themselves. From my perspective it's all very cray cray.

Business schools will be studying Uber for years.
Great post Michael.

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