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Uber revolution will not last

washingtonpost.com

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Re: Uber revolution will not last

#61

Post by jimminy »

brandelune wrote: post #51
jimminy wrote: post #24

Earlier quoted context omitted.

The valuations and conditions between Lyft and Uber are drastically different. Lyft with the funding from GM has only raised $2B over it's lifespan which is comparable to that of Uber. Uber has raised nearly $13B and blown through most of it. At their last round, Lyft is valued at about $6B and Uber is valued at $68B. One of these is reasonable based on the taxi market size (domestic $20B), the other is about 2x over…

The problem with Uber is not the business model, it's the hype that leads to overvaluation as you properly show. Too bad the article does not make that crystal clear.

Part of it is business model, they've outsized their market potential which is a failure of their model.

It's a bit of a chicken and the egg, because it's absolutely related to their valuation. That valuation is based on a flaw somewhere in their model potential, which feeds back into the model of potential (via expressing oversized outside interest).

Re: Uber revolution will not last

#62

Post by kayoone »

Uber's biggest problem is the rate at which they burn cash and their $70B valuation which imo will be very hard to justify in the next 5 years. If that hype train stops getting funded, it might crash badly.

Re: Uber revolution will not last

#63

Post by norikki »

Fricken wrote: post #10

Certainly, sooner or later the liliputians will come in and tie Uber down, but it's a giant now. It's a little too late to be proselytizing about the company's imminent demise. And in spite of supposedly losing in China, Uber managed to negotiate some pretty favorable terms. Uber now has a board seat and a 20% stake in Didi, a 30 billion dollar company growing about as fast as Uber was when it was that size.

Unlike the USA, China doesn't allow foreign companies to compete there. The only exception is Apple, and that's after they almost had a revolution from the unmet demand, and Apple is still given a hard time.

Re: Uber revolution will not last

#64

Post by linkregister »

Animats wrote: post #57

As criticism of Uber goes, this is kind of weak. Uber's big problem is simply that they lose money. They still have to use investor capital to buy market share. That shouldn't be necessary at their present size. Also, Uber has run out of investor financing and is now using leveraged loans.[1] Those have to be paid back. Their 2015 financing was a six year convertible bond. The bondholders get the right to participate…

Ironically, Amazon has resurrected Webvan with several of its former higher-ups [1].

Maybe Amazon will wait for the Uber/Lyft flameout and hire the nascent companies' experts to make its own profitable service.

[1] http://www.reuters.com/article/net-us-amazon-webvan-idUSBRE9...

Re: Uber revolution will not last

#66

Post by matt4077 »

prostoalex wrote: post #4

The "labor-exploiting" argument seems a bit disingenious to me. It's not like someone sees an ad for Uber and tells their boss to shove it, as they're quitting their full-time job, forfeiting all the benefits and 401(k) matching to start a brand new career as an Uber driver. The alternative for many drivers is simply unemployment. While there's zero possibility of labor exploitation, it reminds me of Flight of the Co…

The most common alternative, and the actual net change, is taxi driver. The only difference being a 50% reduction in wages.

It's a giant app-based redistribution of wealth from the front seats to the back seats.

And even if the alternative were unemployment – how does that mean that there shouldn't be a standard for such kinds of work? If people have to accept any working conditions because otherwise they'd starve to death, is that really an argument for the mighty benevolence of the free market?

Considering that it appears as if there's plenty of food to go around, it doesn't strike me as the perfect outcome of 300 years of capitalism that we apparently still need to have 10% of every generation suffer, not because of any real scarcity but as a necessity for the other's motivation.

Re: Uber revolution will not last

#67

Post by linkregister »

norikki wrote: post #63
Fricken wrote: post #10

Certainly, sooner or later the liliputians will come in and tie Uber down, but it's a giant now. It's a little too late to be proselytizing about the company's imminent demise. And in spite of supposedly losing in China, Uber managed to negotiate some pretty favorable terms. Uber now has a board seat and a 20% stake in Didi, a 30 billion dollar company growing about as fast as Uber was when it was that size.

Unlike the USA, China doesn't allow foreign companies to compete there. The only exception is Apple, and that's after they almost had a revolution from the unmet demand, and Apple is still given a hard time.

Was there a regulatory obstacle to UberChina that was in the news? I was under the impression that Didi simply outperformed UberChina, from having a superior local perspective. The difference between Didi and dead or dying car-sharing services was that Didi had enough financing to withstand the race-to-the-bottom on pricing and driver incentives.

Re: Uber revolution will not last

#68

Post by quanticle »

kayoone wrote: post #58
quanticle wrote: post #15

I don't understand the point he's making about traffic congestion. He's claiming that "Uber is putting more cars on the street". More compared to what? Compared to everyone driving themselves? If Uber wasn't around, the alternative would not be people taking public transport. The alternative wouldn't be people waiting 35 minutes for taxis. The alternative would be people driving in themselves, causing greater congest…

Uber is not available in Germany but when i can't get a cab i will usually resort to public transport because i mostly use a cab when i am not allowed to drive anymore or parking in that area is impossible. Also a 20 minute Taxi ride alone can easily be 15-17EUR in Berlin, so it's kind of a pricy alternative when public transport would be 2,70 EUR for the same distance.

Europe is not comparable to the US. Your public transit systems are far more developed.

Even in Seattle, (which has a decent public transit system compared to where I grew up) you can be expected to wait an hour or more for a bus if you're traveling in off-peak times. Buses from the city to the inner-ring suburbs stop running around 11:30pm, so if you're planning on staying late in the city, driving or Uber are your only realistic options, given that many taxis show extreme reluctance to take people out to the suburbs.

What's worse, is that sometimes the buses don't even show up. I remember once I showed up to the bus stop 10 minutes ahead of the last bus. I waited for an hour and the bus didn't show up. I tried calling a taxi, but as it turns out taxi companies want you to be at an actual address - giving them a random intersection doesn't cut it. Fortunately, I was able to call a friend who, to his eternal credit, drove me home, but if I'd had Uber in that situation, it would have been a lifesaver.

Re: Uber revolution will not last

#69

Post by icebraining »

pdkl95 wrote: post #46
prostoalex wrote: post #28

Earlier quoted context omitted.

> replacing them with less secure, less paid ones My understanding is that people got in deep debt to the medallion owner, which they slowly repaid from taxi revenues. Are taxi jobs at the lowest rung that secure and well-paid?

The "medallion" system has its own problems, usually relating to monopoly power. The debt issue you mentioned is an example of that. However, Uber (and similar businesses like airbnb) are really little more than the exploitation of legal loopholes to bypass the usual costs of employment law and industry-specific regulations. Socializing expenses is always profitable, and its easy to beat existing players if you aren'…

Taxi drivers were already considered contractors. In fact, they are in a lawsuit against the taxi companies over that: http://articles.chicagotribune.com/2014-03-26/news/chi-suit-...

Which costs of employment that taxi companies paid is Uber bypassing? Please be specific instead of relying on rumor and propaganda.

Re: Uber revolution will not last

#70

Post by vintermann »

WillPostForFood wrote: post #55
dismantlethesun wrote: post #42

Earlier quoted context omitted.

Medallions (whether or not they were a good solution), were intended to restrict the number of cars on the road during peak hours, and enforce some uniform regulations on all taxis (pick up people of all races, etc.) Uber's' innovation leads to a fleet that's easier to regulate due to constant monitoring, and pre-booking data. However, when it comes to traffic congestion, their solution is pure demand-side economics:…

The creation of medallions had nothing to do with the number of cars on the road at peak hours, or regulations about race. They were created during the depression in NYC to protect jobs for taxi drivers.

Taxi licensing has been around since before cars. The "medallion" system with tradable permits may be from depression era New York for all I know, but just about every locale in the world has come to the conclusion that there needs to be a limited set of permits.

You can push the prices down a little with unlimited competition, but the few dollars you save aren't worth the indirect costs associated with taxi driver desperation: tax fraud, gouging, barely running cars, outright extortion, etc. (Of course, if the municipality decides to pad their coffers by auctioning the permissions/medallions, you get all that in addition to lower competition.)

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