In the same breath you complain that they don't pay their drivers enough and that their service is too expensive.

Drivers aren't going to get more than a few percentage points increase without increasing the price to the end user.

"In the same breath you complain that they don't pay their drivers enough and that their service is too expensive."

You seem to present that as a contradiction, but the obvious conclusion is that the GP believes Uber keeps an unfair share of the ride fees.

Based on my vague internet research, it appears Uber keeps 20-25% plus various fees, like how credit card settlement charges work, which can add up to 40%+ for some rides.

And the amount Uber keeps has to go way up too, if Uber is to cease operating at multi-billon dollar per year losses to become profitable. Currently they only take 20-25% and the rest of the required income to meet operating expenses is subsidized by VC funding.

And the losses are so large that it likely means both raising prices to riders and reducing the net payout to drivers at the same time.

Hence why Uber is unsustainable without VC dollars. As soon as driver pay goes down further and ride costs increase, their model falls over.

This seems like a way of saying Uber does not actually have a possible business model.

(Not saying I agree or disagree.)

Which many people have argued effectively. Izabella Kaminska has written the most interesting articles on that topic in my opinion.

> Drivers aren't going to get more than a few percentage points increase without increasing the price to the end user.

But they should. Perhaps the pay scale is too top heavy. Uber's operational expenses should be trivial (hell, they straight up stole the most expensive bits -- the self-driving car IP). Instead they squeeze the drivers (passing along rate cuts) and riders (surge pricing during shootings, etc) pretty severely.

Uber's driver and rider acquisition costs (marketing, promotions, ads, etc.) are astronomical.

They can't easily scale these efforts back because the value of the service plummets for all parties if they lose their economy of scale.

> Uber's driver and rider acquisition costs (marketing, promotions, ads, etc.) are astronomical.

Which is hilarious to me. Uber is spending a ton of money, and very little of it trickles down to the people that make Uber possible (the drivers).

"we lose money on each sale but we make up for it in volume"

Won't there be some point at which they're established and don't need to work so hard at those things?

Probably not. Riders and drivers are both primarily price-driven. They have little or no brand loyalty. It's a low-margin, race-to-the-bottom type of business.

L5 self-driving cars will be a game-changer for a while, assuming Uber gets exclusivity from Waymo (which now owns a stake in Uber).

It seems to me that they are very well known at this point, and don't have significant competition. I don't see why they would be spending so much money for marketing... maybe in the past, maybe in the future. I must not understand the market.

I'm sure there's plenty of analysis of this out there, so I should read some articles.

> tech bros

What's your point with this?

I imagine a nod at the extremely sexist company culture and the complete absence of a moral compass.

This may be related

https://www.susanjfowler.com/blog/2017/2/19/reflecting-on-on...

Out of everything in the comment, I think this is the point least worth discussing.

I'm no Uber fanboy, but the app provides on-demand, door to door transportation service for (more or less) the entire BART market area.

The point the commenter is making is that Uber is just providing access to it. They aren't training all those drivers, buying and maintaining all those cars, building and maintaining all the roads, etc. BART does all those things for their rail system.

It gets worse. Uber relies on a roadway network built by tax money (BART can't). They also ignore all the externalities of pollution (Bart is minimal in comparison).

The comparison between the two can't be made without adding in more factors.

It's rare that I see anyone bring up the pollution induced by Uber's (and Lyft's) business models. Now there's something I'd like to see studied more intensely.

I don't remember where but I heard that just manufacturing a car cause more pollution than it's entire lifetime on the road. If Uber prevents people from buying cars then Uber may actually be environmentally friendly.

Well then you'd need to balance that against all the new cars that Uber and Lyft drivers lease to support themselves. Cars that might have sat rusting on the lot while reasonable consumers chose to buy more affordable pre-owned vehicles.

Creating a market for new cars only ensures that new cars will continue to be produced in high volume.

Consistent with the 'smart car' idea, where they manufacture cars with a low-environmental impact, yet the cars have poor gas mileage. To be a win, what you said would have to be true.

I've wondered about that for some time.

> If Uber prevents people from buying cars then Uber may actually be environmentally friendly.

How about the new cars that Uber is encouraging their drivers to buy with tantalizing financing?

I don't have a source but I assume that the driver:rider ratio of cars owned times pollution of manufacturing is greater than the rider:driver ratio of time driven time pollution of driving.

The commenter almost certainly has no idea (or more likely, chooses to ignore) the operational infrastructure and excellence it takes to scale a marketplace like Uber's to 4 billion rides, as fast as Uber did it.

Any hot-take that centers around "It's just an app that a couple of guys wrote in an afternoon with some underpaid drivers doing all the work" is someone arguing in bad faith (and I suspect the person is well aware of it). There is a ton that goes into scaling a marketplace in general - let alone an on-demand one with thousands of corner cases, real time demand forecasting, real time fare calculations, real time capacity planning, customer support operations, etc.

"...operational infrastructure and excellence it takes to scale a marketplace like Uber's to 4 billion rides..."

Nope! In the grand scheme of things, building an app, and some backend software while maintaining bunch of servers doesn't compare to building:

[1]

- 46 BART stations: 17 surface, 14 elevated and 15 subway stations.

- 669 revenue vehicles

- 112 miles of railway track

- a police force with 206 legally sworn-in law enforcement officers and 90 other staff members

- a wireless network that supplies cell phone service to riders underground

BART isn't even that good - I live in Sydney and we are always complaining about our double-decker dead-silent very clean commuter and city rail. Buzzfeed [2] even thinks our train system is from the future!

I love software - I want to make a career out of it, but we can't forget "real" engineering fields and the effort that goes into them.

[1]: https://edition.cnn.com/2013/07/04/us/san-francisco-bay-area...

[2]: https://www.reddit.com/r/sydney/comments/8rulvn/mfw_american...

Structural engineering is the art of solving the known knowns, which basically reduces the complexity to budgeting/resource planning. Startups need to solve the known unknowns and the unknown unknowns, which is inherently more challenging and difficult.

Please. They drive around on roads that they don't pay for, in cars that they don't own, using drivers that they don't pay. The routing engine is Google's (they all use Maps). The rest of the stuff is impressive, and not something that you can put together in a day, or even a year. But I don't think it should be as difficult as it is for them to make a profit. I genuinely don't know what their expenses are other than giving away shit for free.

You know Uber builds it's own mapping services right? And in fact, the guy who helped lead those efforts is the guy responsible for creating Google Earth which later formed the basis for Google's entire mapping efforts (which he led).

https://en.wikipedia.org/wiki/Brian_McClendon

He's a great guy by the way, in addition to being super smart.

Your others points are not well thought through at all - I urge you to spend some time really thinking deeply about them if this is a topic you care about.

Every company drives around on roads they don't pay for. Roads are a benefit to society - part of the reason we value them is because they enable commerce. Do you complain that GrubHub doesn't use their own roads when they deliver your food? Do you complain that Pizza Hut doesn't own it's own cars when their delivery drivers bring you pizza? Does United help pay for the airports that enable them to exist?

Look, the fact of the matter is that consumers LOVE ride sharing services. They're fast, they're cheap, they're clean, they're safe, and the customer support is incredible. Ride sharing today is simply 10x better than any alternative in most cities. If you're going to argue for cabs being superior, then you either do not live in America or you've never taken a cab before. Not only that, but many drivers love ride-sharing too. Whole classes of people that couldn't find work before can now easily find work with Uber or Lyft (including the deaf, mute, retired, students etc). They can work when they want to, as much as they want to (or as little) and set their own schedule. This is simply not possible with any other low-wage work.

Having said all of this, I don't mean to imply that we should absolve Uber of responsibility for their business practices or their culture problems. We should absolutely push them, and the industry to be better. But this isn't just about Uber. This is about ride-sharing in general, which completely changed what transportation in cities means. It is absolutely innovative in every sense of the word.

> But this isn't just about Uber. This is about ride-sharing in general, which completely changed what transportation in cities means. It is absolutely innovative in every sense of the word.

I think you are overstating it somewhat. Ride Sharing is just a doublespeak name for owner-driver minicabs, which have been around for ages.

On the one hand creating GPS-enabled autodispatching minicabs did allow for a difference in scale that makes it a genuinely different service from what was there previously.

But when all these services end up doubling in price, as they're going to inevitably have to do (and the autonomous vehicle cavalry isn't going to charge in to save the day), it will be interesting to see what happens. My own experiences suggest there are a lot of people who don't want to get sweaty walking 3 blocks or to mingle with the masses on mass transit.

>You know Uber builds it's own mapping services right? And in fact, the guy who helped lead those efforts is the guy responsible for creating Google Earth which later formed the basis for Google's entire mapping efforts (which he led).

Yeah, but when I get into a car it's not Uber Maps on the phone, it's Google Maps. So I'm not very concerned about a guy who worked at Uber for less than two years.

>He's a great guy by the way, in addition to being super smart.

I'm sure he is, which is why he got the hell out of there.

>Do you complain that GrubHub doesn't use their own roads when they deliver your food?

Yes, I would like for them to pay their fair share in road taxes.

>Do you complain that Pizza Hut doesn't own it's own cars when their delivery drivers bring you pizza?

...yes, but now we're being redundant.

>Does United help pay for the airports that enable them to exist?

Now this is just ignorant. Yes, large airports charge millions in landing fees. Train companies pay absolutely egregious property tax rates. It's just cars and trucks that get away with paying 18.4 cents per gallon. Oh, and me who has to pay taxes to fix the roads here while congestion and air pollution here in Chicago have absolutely skyrocketed.

>which completely changed what transportation in cities means.

Uber's success is basically because they were able to push all of the legacy costs of public transit onto taxpayers and claiming that they're more efficient. It's VC-funded bus routes but using a phone. DISRUPTION.

> Yeah, but when I get into a car it's not Uber Maps on the phone, it's Google Maps. So I'm not very concerned about a guy who worked at Uber for less than two years.

Navigation might be Google Maps or Waze, but everything else is Uber. My point is that Uber is 100% serious about mapping and they are investing a ton of resources into it. They're likely one of the few players who are doing this at scale, internationally.

> I'm sure he is, which is why he got the hell out of there.

Now you're projecting. He left Uber so that he can run for office in his hometown of Kansas City. I think he has a lot to contribute outside of technology. I got to know him because I went to a talk he gave once. And no I don't work for any of these companies.

> Taxes & Roads

Ultimately, everyone pays for roads. Not just drivers. And we pay for them because they're for the benefit of everyone. They enable services like GrubHub/Uber/UPS/Dominoes as well as commerce more generally - which in turn makes our lives better. It's a complex system, and I suspect that the tax revenue the government gets for roads is higher after the introduction of Uber/Lyft. With that being said, if you feel a tax is necessary then I respect that opinion. Even with a tax like you're suggesting, it won't change the demand curve meaningfully or affect Uber's profitability. It's likely serve to further entrench them if anything at this point.

With respect to your point about Airports, they're not even close to being paid for by the airlines in any meaningfully fair way. First of all, the government subsidizes it up front with billions of dollars, expensive zoning, planning resources etc. That's a huge capital risk that society takes on for the long-term benefit of everyone (you can't opt-out if you don't fly on planes). Yes, airlines pay usage taxes and some other fees that help pay for the airport but it stands to reason that the government won't recoup that kind of money in even a single decade. The government props up the airlines industry in large part because we demand it and it makes our lives better.

> Uber's success is basically because they were able to push all of the legacy costs of public transit onto taxpayers and claiming that they're more efficient. It's VC-funded bus routes but using a phone. DISRUPTION.

Absolutely wrong. I use Uber/Lyft every day. I don't have a car. Uber/Lyft are nothing like a bus route - not even close. To even suggest that they're similar to a traditional bus service route is to reveal that you haven't used the services in any meaningful way.

They are absolutely 100% disruptive (even more so if you're a woman and safety is important to you). I'm telling you, ride sharing has changed how I get around in cities, period. There's a reason drivers drive for these services. Ride sharing is creating a whole class of jobs that have a very important role to play in society. Stay-at-home moms that use Uber/Lyft to supplement their income while being able to have flexible work. Students that are just getting started in their career and are using Uber/Lyft to sustain themselves in the interim. Retired veterans who don't have any other way to earn a steady income. Deaf people who can't find jobs otherwise. Immigrants who are trying to build up a support base for themselves. The list goes on. Talk to the drivers, this kind of work is a big boon to a lot of people.

Now, should these be the only career options for people? Obviously not. I think that's where most people's concerns are valid. We can't create a society where this is the only type of work available. But can this type of work exist alongside other meaningful options? Of course!

> Navigation might be Google Maps or Waze, but everything else is Uber. My point is that Uber is 100% serious about mapping and they are investing a ton of resources into it. They're likely one of the few players who are doing this at scale, internationally.

So you're comparing scaling out a mapping back end to building and running massive transit infrastructure?

> With respect to your point about Airports, they're not even close to being paid for by the airlines in any meaningfully fair way.

Take a look at JFK. Airlines absolutely do pay significant amounts into airports.

> Absolutely wrong. I use Uber/Lyft every day. I don't have a car. Uber/Lyft are nothing like a bus route - not even close. To even suggest that they're similar to a traditional bus service route is to reveal that you haven't used the services in any meaningful way.

FWIW, BART doesn't run buses.

> Ride sharing is creating a whole class of jobs that have a very important role to play in society.

Minimum wage jobs with no benefits (thus externalizing the cost of providing the jobs)? That's not much of a win in my book.

> Now, should these be the only career options for people? Obviously not. I think that's where most people's concerns are valid. We can't create a society where this is the only type of work available. But can this type of work exist alongside other meaningful options? Of course!

And absolutely none of that means Uber is doing something more challenging than running a transit agency like BART or NYMTA. Uber's externalized most of their costs, disregarded most laws, and is scaling a very specific part of their software stack. It's not surprising to see growth under those circumstances.

> They are absolutely 100% disruptive (even more so if you're a woman and safety is important to you).

Ah, I thought things like "God mode", Boobr, and doxxing critics felt creepy and unsafe. But that's just me, and I'm not a woman.

> There's a reason drivers drive for these services.

Sure. We like to call those predatory financing and exaggerated claims about compensation. Your buzzword laden defense of Uber misses the point though: scaling Uber is significantly easier than scaling a transit agency like an airline or BART.

> Ah, I thought things like "God mode", Boobr, and doxxing critics felt creepy and unsafe. But that's just me, and I'm not a woman.

Have you talked to actual women? Ask them if they feel safer in an Uber, in a Taxi or in BART. Seriously go try this experiment. Assuming you're in the Bay Area, ask 10 of your closest female friends.

Also remember that Uber is just one ride sharing company.

> Sure. We like to call those predatory financing and exaggerated claims about compensation. Your buzzword laden defense of Uber misses the point though: scaling Uber is significantly easier than scaling a transit agency like an airline or BART.

People are not stupid. If it was a raw deal for them then they'll jump ship (there are huge communities of drivers that constantly crunch numbers, share spreadsheets, etc). You can drop in and drop out at any time. That's one of the benefits of doing Uber. Work at McDonald's? Now you have to fight to get enough work hours for pay, you can be overworked, you can be shortchanged, you can have grueling schedules, you can't take vacations easily, the actual work is stressful....have you sincerely ever worked a job like that?

> Your buzzword laden defense of Uber misses the point though: scaling Uber is significantly easier than scaling a transit agency like an airline or BART.

I think you forget that the OP that prompted my response said "I genuinely don't know what their expenses are other than giving away shit for free", which is what I was responding to.

If you genuinely agree with the OP and you've made up your mind, then I don't think there's anything I can say to convince either of you that scaling Uber isn't a matter of giving away shit for free and building an app in a weekend.

You're welcome to believe what you want.

> Have you talked to actual women? Ask them if they feel safer in an Uber, in a Taxi or in BART. Seriously go try this experiment. Assuming you're in the Bay Area, ask 10 of your closest female friends.

I am in the Bay Area, and the biggest proponent of taxis over Uber that I know is female. The only woman I know that uses Uber does so because her boyfriend is a code monkey at Uber and so they'd get a few rides for free each month.

Of my friends that use "ride sharing" apps, they almost all use Lyft exclusively because they find Uber so reprehensible. I also see plenty of vehicles signed for Lyft alone or Lyft + Uber, but almost never see Uber only vehicles.

As a woman how do you feel about Uber fighting background checks tooth and nail?

Or how about this?

http://time.com/5023287/uber-threatened-journalist-sarah-lac...

Or this?

https://www.nytimes.com/2017/06/15/technology/uber-india-rap...

Or this?

http://www.newsweek.com/uber-and-lyft-drivers-accused-more-1...

And, really, Kalanick using Uber for sex (a.k.a. Boober) doesn't bother you in the slightest? Good for you then.

> People are not stupid. If it was a raw deal for them then they'll jump ship

https://www.recode.net/2017/2/28/14766964/video-uber-travis-...

So this guy is an idiot then? How exactly do you get out of an auto loan that you're now underwater on because Uber decided to turn the screws on you?

> I think you forget that the OP that prompted my response

I am the author of the comment you replied to. I'm happy to be convinced but marketing doublespeak like "engineering excellence" isn't convincing in any manner. Uber develops an app and spends a ton on marketing. Beyond that Uber externalizes almost all of its costs. That's trivial to scale compared to actually scaling a transit company that has to invest in infrastructure.

Hypothetically, if a company is able to provide the same service as BART without building and maintaining all that infrastructure, isn't that a huge point in favor of that company?

Capitalize the gains, socialize the losses. The infrastructure has to be built, if the company doesn't do it, the state does, which means society pays. More individual rides mean more traffic congestion which means a worse experience for everybody.

I think that Uber from an investment perspective is looking good but from a social perspective it's looking bad.

> operates a multi-jurisdictional police force.

operates a joke of a police force.

Better than none, and using the public's resources.

It's actually not better than none, but feel free to believe whatever you want to.

Regardless of how good or bad BART PD is, running a police force is an operational cost Uber doesn't incur.

Didn't object to that!