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Do drivers collect the additional income during surge pricing or does the delta simply line uber's pockets? It seems like you could game the system by simply only driving during surge pricing.
Unless I'm missing something, the claim that becoming a taxi driver can become a well-salaried, middle-class job for a significant number of people is patent nonsense . There is a reason that taxis look the way they do and are driven by the people who currently drive them, and regulations and licensing is only a small part of that. Uber might disrupt the taxi industry, maybe for the better, but once equilibrium is re…
> Given the sheer volume of demand for rides, the relative ease of copying this service, and the number of cars owned by Americans, I don't see how their large revenues can be anything other than temporary. I think the investors are playing the short game. The long game is in capitalizing on (a) network effects and (b) the effects of changing technology on consumer behavior and market structure. Start with network ef…
For example, a telephone by itself is completely worthless. A telephone when all your friends also have telephones is great.
Uber doesn't benefit from this effect in any meaningful way. If my friends all use Uber, that doesn't make Uber inherently more useful to me than Lyft (or a cab). Its utility is divorced from the number of other people using it.
What you're talking about is more properly called "mindshare" (much as I hate that term) or simply "consumer awareness".
>Median uberX Small Business Income Per Year: $90,766 (NYC); $74,191 (SF) http://blog.uber.com/uberimpact Is it pretty much accepted that Uber is outright lying here? Does anyone believe there is a driver out there banking $100,000 driving a taxi? I know the company is shady but hoping they can generate enough new blood to compensate for burnout of drivers chasing the dream seems abusive.
Maintenance, repairs, insurance, and gas are all direct costs that don't really improve with economies of scale. Car payments too - though white collar workers may also be hit with that, but probably less so.
I think there's a bit of deliberate obfuscation here where Uber wants you, the office worker, to think of that $90K without all the strings attached, in which case it would be a pretty decent income.
Earlier quoted context omitted.
> But neither network effects nor technology will change overall number of people who need rides It did with me (granted, N=1). I reduced my own driving to zero and replaced it mostly with Uber. That isn't just a shift in my quantity of rides demanded, it's a shift in my demand curve. > driving cars is unskilled labor I would not have given up driving if the alternative were yellow cabs. New York taxi drivers are not…
If Uber significantly affects demand, then we might see seismic shifts in the demographics of drivers. As for the existing drivers, my point is that the effects you're touting are temporary. Taxi companies that provide a lesser service will die off and be replaced by others that follow the example of Uber. The overall economics of the thing will not change unless there is a significant change in demand. I don't think…
I don't think Uber in its present form will shift the demand curve dramatically. Driverless cars will. A world with driverless cars could follow two models. Let's call them Apple and IBM.
Apple: each household owns a driverless car. Perhaps it can be occasionally rideshared via UberX, Lyft, etc. In this world, you are right: Uber tomorrow will be Uber today.
IBM: Uber (or Google or Tesla...) owns (and finances and repairs and replenishes) a fleet of driverless cars. Households pay it use fees. In this world, Uber's strategic autonomy is dramatically improved over today. If I were Uber, this is the long game I'd be playing for. I would be (a) training riders to depend on hiring cars with minimal personal contact, (b) encouraging the development of driverless cars, and (c) building a cash pile for rapidly acquiring a vast fleet of driverless cars the moment they become viable.
Earlier quoted context omitted.
> Given the sheer volume of demand for rides, the relative ease of copying this service, and the number of cars owned by Americans, I don't see how their large revenues can be anything other than temporary. I think the investors are playing the short game. The long game is in capitalizing on (a) network effects and (b) the effects of changing technology on consumer behavior and market structure. Start with network ef…
I think you're misunderstanding what "network effects" means. A product or service benefits from the network effect when it becomes more useful the more users it has. For example, a telephone by itself is completely worthless. A telephone when all your friends also have telephones is great. Uber doesn't benefit from this effect in any meaningful way. If my friends all use Uber, that doesn't make Uber inherently more…
>Median uberX Small Business Income Per Year: $90,766 (NYC); $74,191 (SF) http://blog.uber.com/uberimpact Is it pretty much accepted that Uber is outright lying here? Does anyone believe there is a driver out there banking $100,000 driving a taxi? I know the company is shady but hoping they can generate enough new blood to compensate for burnout of drivers chasing the dream seems abusive.
They may not be lying - that could be raw revenue. Unlike white collar jobs driving a car for a living comes with a lot of costs that kill your actual take-home income, far above and beyond just taxes. Maintenance, repairs, insurance, and gas are all direct costs that don't really improve with economies of scale. Car payments too - though white collar workers may also be hit with that, but probably less so. I think t…
Earlier quoted context omitted.
> Given the sheer volume of demand for rides, the relative ease of copying this service, and the number of cars owned by Americans, I don't see how their large revenues can be anything other than temporary. I think the investors are playing the short game. The long game is in capitalizing on (a) network effects and (b) the effects of changing technology on consumer behavior and market structure. Start with network ef…
I think you're misunderstanding what "network effects" means. A product or service benefits from the network effect when it becomes more useful the more users it has. For example, a telephone by itself is completely worthless. A telephone when all your friends also have telephones is great. Uber doesn't benefit from this effect in any meaningful way. If my friends all use Uber, that doesn't make Uber inherently more…
The more drivers they have the more useful it is to riders. There more riders they have the more useful it is to drivers.
Whether this is sufficiently far from the original meaning of "network effect" that we need another name for it, maybe. Given how obvious this effect is, is there an existing name already for it?
This isn't particularly new nor unique to technology. This is the entrenching effect you see in all exchanges - the stock exchange, eBay, etc... any clearing house for sellers and buyers to meet will benefit from this effect.
I don't think "mindshare" is the right word for this.
Earlier quoted context omitted.
> Given the sheer volume of demand for rides, the relative ease of copying this service, and the number of cars owned by Americans, I don't see how their large revenues can be anything other than temporary. I think the investors are playing the short game. The long game is in capitalizing on (a) network effects and (b) the effects of changing technology on consumer behavior and market structure. Start with network ef…
But neither network effects nor technology will change overall number of people who need rides (demand) and the fact that driving cars is unskilled labor. If Uber pays more, taxi drivers will make rational decisions and become Uber drivers. Or Lyft drivers. Or whatever other competitor. If Uber has nicer cars or more efficient service, taxi services will adapt or go out of business. The drivers will go elsewhere, not…
Do drivers collect the additional income during surge pricing or does the delta simply line uber's pockets? It seems like you could game the system by simply only driving during surge pricing.
The supposed purpose of surge pricing is to get more drivers on the street, so that implies that the drivers see some portion of the extra payment.
Do drivers collect the additional income during surge pricing or does the delta simply line uber's pockets? It seems like you could game the system by simply only driving during surge pricing.
The more drivers stay at home, the more there is surge pricing. The more drivers drive, the less there is surge pricing. Such is the game of equilibrium :)