Why I don't believe in Uber's Success • Hacker News Board

Re: Why I don't believe in Uber's Success

#371

Post by emmanuel_1234 » Fri, Jan 20, 2017, 7:39 AM UTC

ghaff wrote: post #310

secabeen wrote: post #114

Earlier quoted context omitted.

I think that market is smaller than you may think. There are lots of factors that will drive people to own their own self-driving cars rather than rely exclusively on Uber/Lyft/Tesla Mobility, etc.

In addition to what others have mentioned, there's also the mobile storage locker aspect. When traveling for example, there are any number of occasions when I will end up renting a car rather than using other transportation because it means I don't have to always be carrying with me all my stuff for a whole set of activities. It happens at home as well. I don't need to bring a bag for evening activities into work bec…

That's definitely a habit you've formed, that you can grow out of. Given no choice, you'd quickly figure out optimized way to do the same things without a personal car.

Given proper public transportation, I did. Not owning a car is not only a lot cheaper, it's also quite liberating: - I don't fear I'll wreck it, or worse, I'll badly injure someone in a car accident - I don't have to drive and be angry about other people on the road, like a lot of drivers - I'm not owned by my car, that requires maintenance and cost beyond just running it. - Not fighting for parking spots!

Re: Why I don't believe in Uber's Success

#372

Post by anabis » Fri, Jan 20, 2017, 8:19 AM UTC

Whether Uber achieves redemption and become a highly profitable monopoly, or other players make it a low-margin red ocean, transportation seems to be set to be dominated by few players compared to today's diffuse private ownership.

I wonder how road building and maintenance will change? Will the decision to build or scrap a road be decided by a negotiation between the dominant stakeholders, instead of public procurement?

Re: Why I don't believe in Uber's Success

#373

Post by nullc » Fri, Jan 20, 2017, 8:32 AM UTC

tashoecraft wrote: post #59

msoad wrote: post #18

> Uber’s growth is fueled by subsidies A lot of people think if their Uber/Lyft ride is cheaper than their traditional taxi because it's subsidized. The lower fare for the most part is due to extreme efficiency difference between a taxi company and Uber/Lyft. 1. Uber/Lyft don't own the cars. They are leveraging car owners capital 2. Uber/Lyft drivers are more efficient because they don't have to roam around the city…

Uber is fueled heavily by subsidies. I took an Uber pool to work, set price of $25. I was the only one picked up, but due to traffic it took ~1hr. The total price that the driver saw was ~60. Someone paid that driver the $35, and it wasn't me, it was Uber (venture capital). That is purely subsidizing and artificially lowering prices.

Underfilled pooling is not a great example though-- filling in load shortfall on pooling is a very efficient way to spend money, because you need to build the load, uber needs to only profit on average, and even if there was no subsidy at all there would occasionally be underfilled cars.

For all you know they did five other trips like yours but with three passengers and your "subsidy" was paid by them; and in exchange uber got a happy passenger and driver which will continue to support their business in the future.

Re: Why I don't believe in Uber's Success

#374

Post by mdonahoe » Fri, Jan 20, 2017, 8:46 AM UTC

bobbytherobot wrote: post #90

vadym909 wrote: post #62

Earlier quoted context omitted.

So then Amazon is not a success either?

First off, Amazon never lost a billion dollars in a single year. More importantly, Amazon could have been profitable for much of the time. Amazon was losing money because they were taking the profits from they successful ventures and pouring it into new ventures. With Uber, what change do they make right now to switch to a very profitable company? Amazon had that option, Uber does not.

...Increase prices?

Re: Why I don't believe in Uber's Success

#375

Post by mirekrusin » Fri, Jan 20, 2017, 9:48 AM UTC

The only thing they need to do, from investor perspective, is to slide on profit/loss margin line while eating market in big chunks - until human drivers can be phased out.

Re: Why I don't believe in Uber's Success

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Post by avar » Fri, Jan 20, 2017, 9:55 AM UTC

tannhauser23 wrote: post #179

sonotwhat wrote: post #142

Earlier quoted context omitted.

I live in Singapore and this is already happening here. In Singapore to own a car you've to get a certificate of ownership that can cost around $70-$100k and you've to bid for this. Ever since Uber began to get popular here we've had rental companies (who only rent if you become an Uber driver, essentially partners of Uber) try to undermine the bidding system by artificially boosting prices. It has never been easy (o…

That's a weird market where the government artificially inflates the cost of car ownership. Like you say, that's never going to happen in the U.S.

Singapore is doing it because the alternative would be to use much more of their tiny island for car-related infrastructure. The total cost of that infrastructure would be much higher than what the sum of the COE's[1] would cost.

Are you sure Singapore is artificially inflating the cost, or that where you live isn't artificially subsidizing the cost of car ownership?

1. https://en.wikipedia.org/wiki/Certificate_of_Entitlement#His...

Re: Why I don't believe in Uber's Success

#377

Post by josepi_ » Fri, Jan 20, 2017, 1:15 PM UTC

LordHumungous wrote: post #139

metaphorm wrote: post #126

Earlier quoted context omitted.

> That cabs only really exist in densely populated urban areas should tell us something about the economics of this business model. yes, it tells us that human cab drivers are prohibitively expensive. robot drivers don't need to paid by the hour though. the real disruption to your car isn't a ride-hailing app on your phone. it's robot driven cars. ride hailing apps are necessary piece of predecessor infrastructure fo…

In my opinion self driving cars are a shiny object to distract VC's from Uber's massive operating losses. When they start making money with self-driving cars on a large scale then I'll take notice.

Uber won't even be necessary. If it becomes cheaper to "rent" the service of the car (i.e. Uber/Lyft with autonomous vehicles), then car manufacturers can just cut out the middle-man. Uber/Lyft would serve no purpose anymore unless they somehow make it cheaper (which would be practically impossible).

The landscape of the future is car manufacturers offering their own "Uber" like service and that service replacing the traditional ownership model. That doesn't mean Uber doesn't have a place before then though. Like good little capitalists, the VC's will cash out and make a ton of money while the real innovation and lasting impact happens elsewhere. So, yeah, Uber should blow up when self-driving cars become a thing but they'll eventually fade away. Unfortunately, that won't be for a long time.

EDIT: Oh, and yeah, people are also going to still be buying a shitload still anyway.

Re: Why I don't believe in Uber's Success

#378

Post by MarkMc » Fri, Jan 20, 2017, 1:28 PM UTC

exelius wrote: post #110

I think Uber's business model relies on self-driving cars. They're paying subsidies now to build a brand -- the name "Uber" has become synonymous with "pull out your cell phone and call for a ride" -- that will be very valuable once self-driving taxis become a commodity (which will happen shortly after their introduction). Uber is not a bet on who can build the most profitable taxi company now -- it's a bet on a bran…

Self-driving cars will remove Uber's one significant competitive advantage: The network effects of having lots of drivers.

I very much doubt Uber's brand will be a significant asset in 10 years. I cannot see any reason why the economics of self-driving cabs would be any different to airlines.

Re: Why I don't believe in Uber's Success

#379

Post by MarkMc » Fri, Jan 20, 2017, 1:34 PM UTC

Here is an additional risk for Uber: What if Tesla or Google or some other company bring self-driving technology to market a year before Uber? For those 12 months Uber will be the guy with a knife in a gunfight.

Re: Why I don't believe in Uber's Success

#380

Post by jayjay71 » Fri, Jan 20, 2017, 1:41 PM UTC

discodave wrote: post #131

dageshi wrote: post #95

Earlier quoted context omitted.

Amazon is in a low margin commodity business with massive amounts of competition, but they're still massive and becoming even bigger because they do what everyone else can do just that little bit better that there's no real reason to switch away.

Amazon actually didn't have much competition at a key point in it's growth, i.e. just after the dot com crash. Amazon survived, many did not and Amazon then had a few years to cement their dominance in the online shopping space. Amazon is also very different from Uber in that it a) went public earlier and b) didn't need huge outside cash injections like Uber and c) Wasn't making a huge gross loss on sales like people…

> (Amazon) didn't need huge outside cash injections like Uber

Amazon and Uber are very different companies, but this wildly oversimplifies the financing of Amazon. Amazon has taken on many billions of dollars in debt over the years in order to operate. If you add it all up, Amazon has taken (in very different terms) about as much money as Uber.

https://www.bloomberg.com/news/articles/2014-12-02/amazon-se...