Uber’s problem is people living in NYC etc mostly just stay in NYC or other major city. The app advantage is only really meaningful for travelers which make a small slice of the overall market. A low cost local competitor in NYC would rapidly get New Yorker’s to swap over and it could then grow one city at a time.

For now everyone is just waiting until Uber and Lyft run out of money, but longer term it’s really not looking good for them.