It's a feature, and why passengers didn't even bother.

It's a dangerous game. With the cost of ride essentially being an unknown, ranging from cheaper than a cab to many times the cost of a cab, I often wouldn't bother either. People prefer consistency in what they pay for an experience, and when it's inconsistent, I lose trust that the value will be consistent (ie. Uber for most people I believe is attractive if the experience is better or equal in cost to a cab, but terrible when the cost is significantly higher than the convenience/better experience.) At least with a cab I am (fairly) certain of the value.

It's a "feature". :P In the same way that it is a feature that the cab driver doesn't have a permit or the proper insurance. Is this really how the new blackmarket is going to work? Do something illegal nationwide with average citizens running it and you are good to go? Maybe I am just being negative. Sorry.

I don't understand why this information asymmetry is more important to their profits than the network effect of controlling a very widely used marketplace?

I'm with you.

I think it's probably one of the 'things that could work better' but unlikely something the company makes much money from.

Think ebay and all its network effect pixie dust, plus the ability to name your own price.

What percentage of Uber's revenue comes from surge pricing?

It's a feature that optimizes for short term profit at the expense of the long term: memory of last year served to reduce demand this year, and memory of this year will serve to reduce supply in the future. Part of me wonders if they didn't tweak the surge multipliers in a misguided effort to appease drivers' expectations.

It appears that they tweaked surge to appease drivers, here's a conversation between an Uber driver and Uber's head of global operations.

http://imgur.com/yG5Ny1Q

It's all speculative because how they implement surge is opaque.

Given that supply and quantity demanded seemed badly mismatched this seems like a failure of the pricing mechanism, one which would not occur in a free market