FYI, the OP links to a 10-part series of posts about Uber's economics by someone with decades of experience in the transportation industry. Here's a link to part one: http://www.nakedcapitalism.com/2016/11/can-uber-ever-deliver...

From that series:

Uber’s real problem is that it is a staggeringly unprofitable company with fundamentally uncompetitive economics. It lost $2 billion in 2015, $3 billion in 2016, and another billion in China. It is a higher cost, less efficient producer of taxi service than traditional operators; all of its growth is explained by these multi-billion dollar subsidies as it has flooded markets with additional capacity offering unprofitably low fares.

It has none of the scale or network economies that allowed other startups to quickly grow into profitability. In its fifth year of operation Facebook had achieved 25% profit margins; in Uber’s fifth year its profit margins were negative 149%. Absolute Uber losses have continued to worsen with recent growth. Margins improved somewhat in 2016, but only because Uber unilaterally reduced driver compensation by $1 billion, leading to news reports of drivers sleeping in the cars in order to make ends meet. Uber never had any hope of profitability in a competitive market, even at its present scale.

That's Uber's big problem.

The response to that has always been that if they can stay afloat until autonomous vehicles arrive, they can cut costs to the point where they're profitable. Beyond that, with the driver costs out of the picture, the cost of an autonomous ride would actually be below the per-mile cost of driving your own vehicle to the point where Uber would ride a wave of decreased individual ownership and reliance on car-hailing services.

The WayMo lawsuit, in which Google appears to have a pretty airtight case, has destroyed that hope. It's the Carpathia radioing that they're 4 hours away. There's no help coming and the Titanic is going down.

Now all these shifts are likely still going to happen. A seemingly cogent analysis I came across recently [1] breaks down the costs and strongly argues for a future where individual vehicle ownership is the departure from the norm rather than the default that it is today. But it just won't be Uber that cashes in on it. Or, more accurately, it won't be the current Uber. If Uber goes down in flames, their carcass will be plucked and someone, perhaps Google in the lawsuit settlement, will come away with Uber's brand and logistics platform that can be paired with self-driving technology to achieve Uber's vision.

[1] https://shift.newco.co/this-is-how-big-oil-will-die-38b843bd...

Even if they could survive until they can switch to autonomous cars, that would remove the barrier to entry for competitors because they wouldn't have to convince drivers to use them. There's more on this comment from last year:

https://news.ycombinator.com/item?id=13079767

The Waymo lawsuit shouldn't affect Uber much. Google's LIDAR is rotating machinery for experimental vehicles, not production use. The production products will be flash LIDAR at a low price point. From Continental, definitely, and Quanergy, maybe. (Quanergy, maybe not. They've been talking big since 2015, but haven't shipped.)

*ten-part

It's still going: http://www.nakedcapitalism.com/2017/06/can-uber-ever-deliver...

Thanks. I fixed it.

I will read this, but from an intuitive perspective Uber should have dramatically better economics vs taxis in places where the minimum buy-in is a $1m medallion purchase.

that article is better, but that doesn't change the fact that the originally linked article is a puff piece.

even in your article, it's not obvious that the economics of uber is doomed. it doesn't talk about the economics of the taxi industry, but simply makes a big assumption that it's an efficient market (just considering medallions should make you skeptical of that claim), so uber must get it's economics in line with the taxi industry. that's not obvious. (maybe it's explained in the 10 parts, but 10 parts?!?! seems like an editor might be warranted).

to be clear, i'm not defending uber, just that the arguments presented aren't so convincing once you dig into them a bit (and appeals to authority make me even more skeptical. it's like saying "trust me"... it sets the alarm bells off).

It might be puff piece, but at least it does not focus on "toxic culture forced CEO to resign". The latter story might feel good and thus be more popular, but is less likely reason for investors revolution then "they are losing money, have no plan and are overall ineffective".

It is true that former CEO personality was important for uber and different dude or lady could not achieve the same, but achievement here is losing tons of money on business that does not seem to be profitable ever. That is odd definition of winning.

The reasoning in the article seemed strong to me: Street level transport is a commodity and the market is mature. There is a maximum amount of value to extract from this business and the current companies almost do that. Uber spent way more money than the industry is likely to generate to try and steal their business.

Combine that seemingly solid market reasoning with them being opposed often and them fucking up almost as often and it seems surprising they are still functioning now. Their are missing leadership, their investors are unlikely to assemble a stellar team, there are existing internal and external problems. This seems overwhelming for all but the most profitable companies, and that is just what was in this short article. Even if it is wrong the reasoning seems solid. News facts or or astounding leadership at Uber are required to pull out of such a deep hole.

Their master stroke was supposed to be a self driving taxi, but they are no closer than anyone else and their bill is due. They appear to have an existential need to have that desperation move work for them for at least a few years before anyone else gets in on it. If they succeed then likely Google and Telsa will succeed within a few months of them. There appears to be no situations where they can recoup losses at a reasonable rate.

I could be totally wrong, but it looks suspicious as hell. If I had money to invest at a scale that mattered to Uber, I sure wouldn't go with them.

your summary of the reasoning is much better than the article itself, which simply asserts that uber is doomed while randomly citing recent developments in the news about uber.

given what i know (which is admittedly not much), i probably wouldn't invest in uber at this point either, but i remain skeptical that the taxi industry is a mature and efficient market, such that uber has no path to profitability (setting aside all their other asinine self-inflicted wounds).

I could be convinced to be more neutral by as little as a reasonable argument that they have a plan. I have not yet seen this plan. I have seen both pro and anti uber zealots though.

The reasoning seems pretty straightforward. Uber is only cheaper than taxis because investors are subsidizing the operating costs. They won't be able to do that forever and become a viable business, and there isn't a very high barrier to entry for competitors even if they somehow manage to snuff out all other traditional cab operators and Lyft etc, because once they raise the prices new competitors can swoop in.

Naked Capitalism did a series of posts on Uber back in November/December of 2016 that did have a lot more facts and reasoning behind them. They probably figured their readers are already familiar with those posts and didn't want to be redundant. You should read those before blithely assuming they don't know what they're talking about.

[TL;DR] you should read before assuming