They've also partnered with Moove in Miami and with Avis.

And GO in Tokyo.

https://en.wikipedia.org/wiki/Go_(Japan)

Curious what these ride sharing companies take for providing the platform. 30%? Having two play off each other they can probably push it down to 15% or lower.

I wonder if Waymo is allowed to charge different prices, or advertise their own direct services, in these partnerships.

"Use the Waymo app instead, save 10%, and get a guaranteed Waymo!"

In Austin, Waymo app directs you to use uber instead.

Almost certainly Waymo has given Uber some kind of time-limited exclusivity in that market.

Hoping someone in the rideshare space could shed some light on this for me but why would Waymo partner with rideshare providers instead of just going in by themselves? Is it just marketing/exposure (Uber/Lyft both have tons of users, Waymo could instantly tap into that user base instead of trying to grow their own) or is it more of a regulatory thing?

I think it’s more a matter of capital rather than marketing. Having hundreds or thousands of cars per city/metro is going to be capital intensive and that has to show up on someone’s books and financed somebow. They were bound to partner with rideshare sooner or later to derisk their own operation.

> Having hundreds or thousands of cars per city/metro is going to be capital intensive

Ha! Lyft doesn't own much of its fleet! There's a small fraction of vehicles that lyft rents through Flexdrive.

Just like Tesla Self self-driving, Waymo can ask people, if they want to offset related capital costs, to buy cars and rent them to Waymo to be reconfigured and run as autonomous vehicles on profit profit-sharing basis.

Yup, marketing. And Waymo can launch at a smaller scale in the market knowing that overflow and rides that Waymo can't do can be done by human drivers.

It's a way for Waymo to prepare to turn on the spigot, too, if they dump a bunch more cars into the market.

It's important for Waymo to do all 3: show they can run the service themselves in a market, and work with both Uber and Lyft, to be able to get fair terms and the option to expand rapidly.

What do uber and lyft get out of it, though? If Waymo succeeds they're out of business, right? Or is the idea that Waymo becomes a hardware provider and uber / lyft become operators?

Uber and Lyft calculate that their cooperation doesn't affect Waymo's trajectory too much, and they immediately benefit from "more drivers."

> Or is the idea that Waymo becomes a hardware provider and uber / lyft become operators?

This is one natural way that things may shake out and a natural path to scale. But Waymo needs to have a fallback plan of A) other parties to work with, or B) just doing it themselves to get a good deal with Uber/Lyft in the long term.

Uber/Lyft would like Waymo to not the the sole provider of autonomous technology and to work with them; they can expect to receive rides at just a bit above marginal cost in that case.

Uber and Lyft's business model is that they don't own cars. Waymo owns cars, so is at a disadvantage to them. Cars are still expensive and need maintenance even if they don't have drivers.

If Uber/Lyft develop their own driverless cars they can terminate the relationship with Waymo and just use their own. If they don't develop their own driverless cars, they can continue to partner with Waymo.

I think they will license the technology and get a cut of the profits. They want to focus on the technology, not building parking garages and maintenance lots everywhere. The local ride share companies will do that.

That's how competition should work. Every layer should have multiple providers until the companies get all of their profits squeezed away and users get the best possible price.

I sometimes prefer to enjoy the benefits of vertical integration, like Apple being able to codevelop hardware and software unrestricted from having to provide a public API at every layer (e.g. airpods device switching), and being able to unilaterally dictate user experience guidelines to app developers (e.g. ask app not to track).

For sure! It's an interesting point. But from an economic point of view, it's better for consumers if there are clean boundaries and every layer is commoditized.

A "layer" itself represents costs that can be eliminated which can lead to lower prices for buyers.

That is why vertically integrated businesses can peel away business from existing non vertically integrated businesses with lower prices (legal liability notwithstanding). Sometimes it pays to have the business with more to lose insulated from liability by having a layer without much to lose.