Uber's Loss Exceeds $800M in Q3 on $1.7B in Net Revenue • Hacker News Board

Re: Uber's Loss Exceeds $800M in Q3 on $1.7B in Net Revenue

#321

Post by lsc » Tue, Dec 20, 2016, 7:58 AM UTC

morgante wrote: post #246

cylinder wrote: post #72

Earlier quoted context omitted.

I would just take Juno. The drivers here in NYC are only doing Uber to get enough ratings to qualify for Juno. Uber went way too far squeezing drivers, it's a mess. I've seen their Uber pool earnings ... It should be illegal.

Juno is totally non-viable. Being "better for drivers" is not a competitive differentiator. 99% (including me) don't choose services based on which is "better for drivers."

I dunno, I have several friends who consistently use Lyft pool even though the Uber pool in my area is usually less than half the cost, and Juno has a much more credible claim, as far as I can tell, at being ethical than Lyft does.

People spend money on that sort of thing.

That aside, getting drivers is half the battle; even choosing on a selfish basis (and I choose ride-share services on a selfish basis) - if you have more drivers, I have to wait less. For a while, in my area, lyft consistently had more drivers and got there quicker, while uber was consistently cheaper; when I was in a hurry, I'd use lyft.

(my perception is that this has changed and that lyft no longer has that advantage in my area, but point being, if you can't get there in 5 minutes and your competitor can? I might be going with your competitor, even if it's more expensive.)

Re: Uber's Loss Exceeds $800M in Q3 on $1.7B in Net Revenue

#322

Post by puranjay » Tue, Dec 20, 2016, 8:07 AM UTC

animex wrote: post #167

Uber will be a dead Unicorn in the medium future. They've got too many legal pressures, competitors with native advantages (i.e. the automakers), and their expansion plans have them overextended. Here in Edmonton, AB, Canada, regulatory changes have pushed the Uber prices to almost 2x during non-surge times over regular taxis. Taxi's have stepped up. Local competitors have sprouted. Carshares are abounding. It's all…

As I was reading this, I just got a text message from Uber promoting a new offer - Just Rs. 100 for any trip of 15km or less between 12pm to 4pm.

Rs. 100 works out to under $1.5.

Or effectively, $0.10/km if you take a 15km trip.

How the hell is that ever going to be profitable?

Re: Uber's Loss Exceeds $800M in Q3 on $1.7B in Net Revenue

#323

Post by puranjay » Tue, Dec 20, 2016, 8:16 AM UTC

MarkMc wrote: post #318

Naritai wrote: post #296

Earlier quoted context omitted.

This is addressed elsewhere on this thread, but I'll repeat: drivers have no compunction about having multiple apps open at the same time. Nothing ties them to Uber.

Sure, but nothing ties eBay sellers to eBay. For an Uber driver to add another Taxi app it's not just a case of downloading and installing the app. They have to create a user account, enter their bank account details, verify their email address, take a photo of themselves, their car, drivers licence and insurance documents and upload them to the Taxi app server. Then wait a day or two for it all to be processed. If t…

Uber was flat out paying drivers to sign-up.

This is an easy problem to solve.

Re: Uber's Loss Exceeds $800M in Q3 on $1.7B in Net Revenue

#324

Post by uberduber » Tue, Dec 20, 2016, 8:21 AM UTC

realstuff wrote: post #8

LeoPanthera wrote: post #5

Earlier quoted context omitted.

Lyft may be more expensive on paper but I always use it instead of Uber where it is available and they send me so many discounts and coupons that I almost never pay the full price.

Out of curiosity, why do you prefer Lyft?

I used to slightly prefer Lyft but now greatly prefer Uber. In the beginning, Lyft only drivers were generally a bit more personable and Lyft Line passengers were generally always outside waiting and happy about sharing a ride.

I've mostly been taking Uber recently due to their low prices. However, last month Lyft had a Line promotion and I got to take about 60 rides. The vast majority of the drivers were clearly fired Uber drivers and the experience was way worse. Dirty cars, unable to follow navigation, bad driving, no English, and one driver was just a straight up weirdo. They are clearly passing anyone at the in person interview now. And they all had high ratings of 4.7-4.9. I've had similar bad experiences on Uber but they are much less frequent and the drivers were almost always rated 4.3-4.6.

Re: Uber's Loss Exceeds $800M in Q3 on $1.7B in Net Revenue

#325

Post by msane » Tue, Dec 20, 2016, 8:24 AM UTC

puranjay wrote: post #322

animex wrote: post #167

Uber will be a dead Unicorn in the medium future. They've got too many legal pressures, competitors with native advantages (i.e. the automakers), and their expansion plans have them overextended. Here in Edmonton, AB, Canada, regulatory changes have pushed the Uber prices to almost 2x during non-surge times over regular taxis. Taxi's have stepped up. Local competitors have sprouted. Carshares are abounding. It's all…

As I was reading this, I just got a text message from Uber promoting a new offer - Just Rs. 100 for any trip of 15km or less between 12pm to 4pm. Rs. 100 works out to under $1.5. Or effectively, $0.10/km if you take a 15km trip. How the hell is that ever going to be profitable?

It's introducing people to the service and acquiring market. Better prices come later.

Re: Uber's Loss Exceeds $800M in Q3 on $1.7B in Net Revenue

#326

Post by dx034 » Tue, Dec 20, 2016, 8:28 AM UTC

antiviral wrote: post #206

guiambros wrote: post #185

Earlier quoted context omitted.

The key part is " ...has a dangerous probability of creating a monopoly for the discounting firm ". That's not the case here. I don't see Uber creating a monopoly in any way. If they raise prices to unreasonable levels (i.e., more than people used to pay for regular cabs), people will go to Lyft, Juno, or the next ride-hailing startup. If there's no competitor remaining, new ones will show up. Or regular cabs will be…

Amazon had a structural advantage built into their more efficient online operations vs. a traditional brick and mortar store. Regarding your point about probability of creating a monopoly: "Brishen Rogers, an associate professor at Temple University’s Beasley School of Law who has studied Uber’s effects on the taxi market, said traditional cab companies are clearly threatened by newer competitors, and he expects many…

Traditional taxis are threatened by new competitors, but the plural here is important. It's not just Uber, it's Uber, Lyft, and all the others that can come up. Here in London we already have a large number of minicab companies. Uber is very successful because they're cheapest. But as soon as they'd raise prices someone else will take the crown.

Developing a basic app for taxis (calling a cab, paying, ETA) will probably not cost more than a few millions. Getting people to drive for you (in addition to other companies) is also very easy at the moment. That makes barriers to entry extremely low in the market. It's not an Amazon with huge warehouses and not a Google with a highly sophisticated search algorithm. Uber just competes by price, they have no real technical advantage here.

Re: Uber's Loss Exceeds $800M in Q3 on $1.7B in Net Revenue

#327

Post by dx034 » Tue, Dec 20, 2016, 8:29 AM UTC

alistproducer2 wrote: post #152

rubicon33 wrote: post #33

Earlier quoted context omitted.

Huh? What's the end game? The end game is a company with self driving cars, having SIGNIFICANTLY less overhead than they currently do with human drivers. And, probably a ton of technology patents to boot? Yea, they're definitely a brazen company, but do you really expect anything less from a unicorn company? Very few make it this big without cutting some corners, having some connection, etc.

>The end game is a company with self driving cars, As it seems that is their only chance at profitability, then they should be plowing a lot more of their capital into driverless R&D.

I think they're already putting everything in there they can. They're probably the most aggressive developer of self driving capabilities (i.e. directly testing in the wild).

Re: Uber's Loss Exceeds $800M in Q3 on $1.7B in Net Revenue

#328

Post by kalleboo » Tue, Dec 20, 2016, 8:32 AM UTC

alistproducer2 wrote: post #166

Here's what I'm not understanding about Uber. There' nothing they provide that couldn't be cloned. It's clear there's no way to grow into profitability so once the VC subsidies go away Uber will have to significantly raise prices to survive, putting them in the same price range as traditional car services. At that point, what's to stop Yellow Cab from creating their own Uber clone and eating Uber's lunch?

> At that point, what's to stop Yellow Cab from creating their own Uber clone and eating Uber's lunch

Their own incompetence

Re: Uber's Loss Exceeds $800M in Q3 on $1.7B in Net Revenue

#329

Post by CamelCaseName » Tue, Dec 20, 2016, 8:39 AM UTC

bogomipz wrote: post #270

msoad wrote: post #263

Earlier quoted context omitted.

Yes, that's correct. The taxi business (now they called "ride sharing" for some reason!) is just like air travel. Price matters the most but brand and quality of service is important as well. It's a very low margin business and has a low barrier to entry. This makes Uber a risky investment in my opinion. Once Uber decides to make money, the real game will start. You'll see lots of competition and not much appetite fo…

>"Price matters the most but brand and quality of service is important as well." Many drivers drive for both Lyft and Uber so what exactly is that brand? The app? I don't see a lot of brand to be loyal to.

>Many drivers drive for both Lyft and Uber so what exactly is that brand? The app? I don't see a lot of brand to be loyal to.

I believe this is incorrect. Many drivers stick to one because they get a guaranteed wage if they're online for 50 minutes per hour and pick up every call they get.

As for customers, switching costs might be low, but unless there's a reason to switch, why would they?

Re: Uber's Loss Exceeds $800M in Q3 on $1.7B in Net Revenue

#330

Post by coryl » Tue, Dec 20, 2016, 9:12 AM UTC

MarkMc wrote: post #318

Naritai wrote: post #296

Earlier quoted context omitted.

This is addressed elsewhere on this thread, but I'll repeat: drivers have no compunction about having multiple apps open at the same time. Nothing ties them to Uber.

Sure, but nothing ties eBay sellers to eBay. For an Uber driver to add another Taxi app it's not just a case of downloading and installing the app. They have to create a user account, enter their bank account details, verify their email address, take a photo of themselves, their car, drivers licence and insurance documents and upload them to the Taxi app server. Then wait a day or two for it all to be processed. If t…

All the taxi apps are incentivizing signups by subsidizing their pay rates. Everyone is essentially taking losses to grow market share. Drivers will signup for whoever can make them money, so there isn't as much friction as suggested. They earn their livelihoods from driving, so a couple day sign up process is well worth it.