# It Will Take a Lot to Kill Uber



## Maven (Feb 9, 2017)

https://www.bloomberg.com/view/articles/2017-08-02/it-will-take-a-lot-to-kill-uber
*It Will Take a Lot to Kill Uber*
Mounting problems aside, it has one thing going for it: It provides a valuable, in-demand service. 
August 2, 2017 by Justin Fox (OPINION)









It'll take more than that. - Photographer: Spencer Platt/Getty Images

For six months now, almost all the news about Uber has been bad. Even before then, the ride-hailing company's combative executive team displayed a remarkable facility for generating negative headlines, but since former Uber engineer Susan Fowler went public in February about seemingly systemic sexual-harassment problems at the company, it's just been one disaster after the other. Ugly lawsuit over allegedly stealing autonomous-car secrets from Google parent Alphabet? Check! Revelations of a concerted effort to evade regulators around the world? Check! Embarrassing video of co-founder and Chief Executive Officer Travis Kalanick rudely berating a diver? Check! Board member resigning after complaining during an all-hands employee meeting on combating sexism that women talk too much? Check!

Even the forced departure of Kalanick in June doesn't seem to have settled things down much, with the company's board struggling to agree on a replacement and Kalanick -- who remains a major shareholder -- reportedly haunting the search with chatter about "Steve Jobs-ing it" by eventually returning to power.

If you think turmoil like this would be bad for the company's business, you're right. Uber's market share in its head-to-head U.S. battle with kinder, gentler rival Lyft fell to 75.3 percent in June from 78.8 percent in February and 90 percent two years ago, USA Today reported last month based on data from TXN Solutions, a consumer research firm.

This does not mean Uber's business is shrinking, though. The company reported that revenue rose 18 percent in the first quarter of this year, to $3.4 billion, and has told investors that bookings were up more than 10 percent in the second quarter. Lyft is growing even faster, but Uber's competition with Lyft is not a zero-sum game -- at least not yet.

For one thing, both companies are still taking market share from taxis. This is from Certify Inc., which runs a travel and expense-management platform for businesses:

Looked at this way, Uber's market share is flat, not falling. Throw in rental cars, and Uber's share of all business-travel spending on ground transportation is still rising, to 55 percent in the second quarter from 53 percent in the first. That's just among business travelers, but it seems reasonable to extrapolate that a similar dynamic is playing out among non-travelers choosing to leave their cars at home (or dispense with them entirely) and taking an Uber or a Lyft instead.

In short, despite shooting itself in the foot again and again and again, Uber continues to hold a pretty commanding share of what is still a growing market. That's partly because of the kind of business it is: a platform that connects customers with providers. Once you've got a critical mass of both signed up, it can be pretty hard to unseat you. Such two-sided markets existed before the internet (credit card companies, for example), but in the online era, they seem to be the default business form. Online platforms such as Airbnb and Uber, Andrew McAfee and Erik Brynjolfsson of the Massachusetts Institute of Technology write in their new book "Machine, Platform, Crowd,"

_represent the richest combination we've yet seen of the economics of bits and the economics of atoms. As they scale, these platforms handle huge volumes of information -- about members and their choices and activities, the availability and pricing of goods and services, payments and problems, and so on. All of this information approaches the ideals of free, perfect, and instant. It's very cheap to store, process, and transmit, and it's getting cheaper. This means that all relevant and useful information can be everywhere on the platform, all the time. It also means that the demand-side economies of scale -- the network effects, in other words -- can eventually grow much faster than costs._​
That all sounds like good news for Uber. So why is it that the company lost $708 million in the first quarter?

One theory popular among the most skeptical observers is that the potential market for ride hailing actually isn't all that big, and Uber and Lyft have been continuing to grow only by offering unsustainably low fares. Eventually their venture capital riches will run out, they'll have to stop subsidizing fares, and their growth will shift into reverse. There's surely something to this worry -- and to concerns that Uber and Lyft will eventually be forced to take on their independent-contractor drivers as employees or at least spend more on benefits for them. Focus on these issues too much, though, and you risk missing that Uber and Lyft really do provide a useful service that wasn't being provided nearly as well before they came along. As Ben Thompson put it in a somewhat different context in his Stratechery newsletter in April:

_The most important reason why Uber (and Lyft) has overcome regulatory challenges most of the time is that the company has positive externalities: not only is the service "good" for passengers (who get a liquid transportation option) and drivers (who get a job), it benefits people who don't use the service. There are fewer drunk drivers, fewer parked cars, restaurants and bars get more business, underserved neighborhoods become accessible, travelers have better experiences, etc._​
Another worry is that the switching costs between Uber and Lyft are quite low: Once customers have installed both apps on their phones, it's no hassle at all to toggle between them for the best service or the best deal. For drivers, it's more complicated, but there are now apps that can manage the process. If switching is easy, it follows that profit margins will always be under pressure. On the other hand, getting to the point where it can offer a plausible switching option to Uber across much of the U.S. has cost Lyft hundreds of millions of dollars. That's a pretty significant barrier to entry.

So Uber and Lyft provide a service that is worth something. Some company (or maybe more than one) should eventually be able to turn a profit by providing it. Despite all its recent troubles, Uber still seems to have the best shot at becoming that company.

Of course, Kalanick talked investors into giving Uber a $69 billion valuation based on a wildly ambitious vision that included a presence in every major global market, brand extensions such as UberEats -- a meal-delivery service -- and Uber's very own self-driving cars. It has ratcheted back those global ambitions over the past year by getting out of China and Russia, and there's probably more retrenchment to come. I don't think Uber is in a death spiral. I do think some of its investors will be sorely disappointed.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.


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## Jo3030 (Jan 2, 2016)

Opinion


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## Maven (Feb 9, 2017)

Jo3030 said:


> Opinion


True, but well-informed and analyzed Opinion. Of course, it's dependent on whether Uber can get its act together. First step - get a new CEO and management structure. Hopefully, one that does not involve TK, unless you believe that a "leopard can change his spots".


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## Taxi Driver in Arizona (Mar 18, 2015)

Jo3030 said:


> Opinion


I remember when all the financial journalists were saying such positive things about Enron. They were the smartest guys in the room, until they weren't.


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## SLuz (Oct 20, 2016)

If you provide a service/product that benefit's the market / community which is created by subsidizing the market / community, but can make no profit then it's really not a successful business, but rather a successful belief system based on giving away investor money. If you gave me 7 billion dollars to make a great wine and sell it for a dollar a bottle, steal market share, put wineries out of business, have people exclaiming the great $1 wine revolution is the future !a Plus tell investors eventually robots will make our wine and then we'll make a great profit; they would write such stories about me. Pax after Pax will tell me how much they like rideshare and how much more affordable, and convenient it is then taxi's. When I tell them it's because their rides are actually subsidized by VC money to the tune of 50% of real costs they're in disbelief as if I just made up something to mess with their high. (not only do they not tip these days but I get these all flag reviews from people trying to get free rides). Addiction, it is a disease.


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## Maven (Feb 9, 2017)

SLuz said:


> If you provide a service/product that benefit's the market / community which is created by subsidizing the market / community, but can make no profit then it's really not a successful business, but rather a successful belief system based on giving away investor money. If you gave me 7 billion dollars to make a great wine and sell it for a dollar a bottle, steal market share, put wineries out of business, have people exclaiming the great $1 wine revolution is the future !a Plus tell investors eventually robots will make our wine and then we'll make a great profit; they would write such stories about me. Pax after Pax will tell me how much they like rideshare and how much more affordable, and convenient it is then taxi's. When I tell them it's because their rides are actually subsidized by VC money to the tune of 50% of real costs they're in disbelief as if I just made up something to mess with their high. (not only do they not tip these days but I get these all flag reviews from people trying to get free rides). Addiction, it is a disease.


Uber/Lyft investors are not the idiots you make them out to be. While it's true that neither Uber or Lyft has ever made a profit, what investors look at is the valuation of the company. In both cases, the valuation of the company is many times the total amount of money invested (or lost). Uber's valuation peaked at almost $70 Billion on total investments of about one-fifth that amount, an incredible (potential) profit in such a short time. Unfortunately, Uber investors are now very nervous since the valuation has dropped significantly since TK left. TK is actively sabotaging potential CEO replacements. TK's goal? Leaving himself as the only possible replacement.


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## Uber_Muie (Jun 19, 2017)

Hopefully TK comes back soon and sinks the whole operation. Greed is king.


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## KMANDERSON (Jul 19, 2015)

Taxi Driver in Arizona said:


> I remember when all the financial journalists were saying such positive things about Enron. They were the smartest guys in the room, until they weren't.


I remember people use to say that about bernie madoff as well.


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## Mars Troll Number 4 (Oct 30, 2015)

KMANDERSON said:


> I remember people use to say that about bernie madoff as well.


Let's not forget all the investors Charles Ponzi had that were pleased at how much money they were making..


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## Uberyouber (Jan 16, 2017)

Uber does a good job of killing itself..


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## KMANDERSON (Jul 19, 2015)

Uberyouber said:


> Uber does a good job of killing itself..


They single handedly keep lyft in bussiness


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## Another Uber Driver (May 27, 2015)

As long as the riding public presses a button and a ride shows up, no one cares about Uber's internal "problems"; no one: really, no one. When the ride stops showing up, people will pretend to care, will not like the answer and will try something else or go back to what they used to do before there was Uber or Lyft.

This assumes that if Uber and Lyft do collapse, no other TNC would rise to take their places. That is a whacked-out assumption. In fact, the argument could be made that it is a textbook illustation of what happens when you ass*u*me.

Still, should it occur, and, the possibility that it would occur is remote, but, should it occur, people will go back to subways, busses, cabs, blue vans, van services, their freinds, their own cars, bicycles, their feet or whatever.


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## SEAL Team 5 (Dec 19, 2015)

SLuz said:


> If you gave me 7 billion dollars to make a great wine and sell it for a dollar a bottle, steal market share, put wineries out of business, have people exclaiming the great $1 wine revolution is the future !


Then many of your consumers would file a $7 billion class action lawsuit against you for encouraging and enabling alcoholism to the public for such a cheap price. You would become so poor that you would have to start driving for Uber again.


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## Michael1230nj (Jun 23, 2017)

The Article glosses over the Drivers Dissatisfaction. Most Drivers feel Trapped. I know not one successful Service Oriented Buisness where the Company's First Visible Representitive (Drivers) Are hostile to the Compamy Uber might be very Successful with this Strategy but they will be the First.


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## Maven (Feb 9, 2017)

Michael1230nj said:


> The Article glosses over the Drivers Dissatisfaction. Most Drivers feel Trapped. I know not one successful Service Oriented Buisness where the Company's First Visible Representitive (Drivers) Are hostile to the Compamy Uber might be very Successful with this Strategy but they will be the First.


So what? Assume you're correct. 90%+ of Uber drivers are hostile to the Company. What are they going to do?

Badmouth Uber to riders. Example: "Uber sucks. use Lyft." Violates Uber TOS and will get the driver immediately deactivated when reported.
Badmouth Uber to media: Been done. Little positive effects for drivers.
Drive exclusively for Uber competitors. Will not work in most markets where Uber has 80%+ of market share of riders if driver want to earn a living.
Complain to Uber, media, etc. Today's result is "180 days of change", all about appearance of improvement, not substance.


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## Fubernuber (Jan 15, 2017)

An economic downturn will crush them. Drivers who barely make it now will turn up at the wrlfare office with handouts enmasse. Officials will realize what they have done. Uber will do itself in. You just enjoy the ride and popcorn


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## TwoFiddyMile (Mar 13, 2015)

Unfortunately, this shill article has some truth init.
I've been looking at Uber pax all morning and they have no souls.
Dead inside.


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## Michael1230nj (Jun 23, 2017)

Time will tell. Culture is pervasive right now the Dynamic between Driver and Customer is Divisive either the Customer feels abused because they are paying a Surge or the Drivers feel cheated because they are working for Peanuts. Is this Sustainable? Will see.


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## dirtylee (Sep 2, 2015)

The only way uber can die now is if it's fight with Google gets it pulled from the app store. TK had a close call with Apple once.


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## Bulls23 (Sep 4, 2015)

Here is the key: "_One theory popular among the most skeptical observers is that the potential market for ride hailing actually isn't all that big, and Uber and Lyft have been continuing to grow only by offering unsustainably low fares. Eventually their venture capital riches will run out, they'll have to stop subsidizing fares, and their growth will shift into reverse_."

This is not theory - it's reality. If it costs me $10 to get to/from my favorite bar, I would go there every day. Change that price to $20 and I'll be there once a week. Remove Pool/Line and all so called "growth" is gone.


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## jonhjax (Jun 24, 2016)

At minimum, uber will have to double existing mileage rates or very substantially increase its booking fees to come anywhere near making a profit. When, no, if, that happens, riders will choose between tncs and taxis - the tnc rates will become very close to that of taxis. The market will then change and be evened out more. In other words, you won't have one company be dominant over the rest. Service will count quite a bit also, and some of the tactics some uber drivers use (i. e. cancelling trips after 5 minutes on the dot,surge pricing ) will come back to haunt uber. Uber drivers' behavior now will determine how successful uber is later, at least to a decent extent.


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## ABC123DEF (Jun 9, 2015)

getoutofmycar said:


> Its only valuable and in demand because everything is sold way below cost !!!
> 
> Raise fares and demand drops in a downward spiral and there is NO POINT EVER that it becomes profitable......


Oh well...Oopsber had it made in 2014 and earlier back when there were some standards. These guys chose to mess up a recipe as simple as boiling water and there's a price to pay for not electing to go the route of slow and steady growth.


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## THE MAN! (Feb 13, 2015)

Maven said:


> https://www.bloomberg.com/view/articles/2017-08-02/it-will-take-a-lot-to-kill-uber
> *It Will Take a Lot to Kill Uber*
> Mounting problems aside, it has one thing going for it: It provides a valuable, in-demand service.
> August 2, 2017 by Justin Fox (OPINION)
> ...


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## Buckiemohawk (Jun 23, 2015)

the investors will be the one who kill Uber.


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## Maven (Feb 9, 2017)

Buckiemohawk said:


> the investors will be the one who kill Uber.


Investors will NOT kill Uber and lose their entire investment. However, they may take radical action to save the largest possible part of their investment.


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## TwoFiddyMile (Mar 13, 2015)

Maven said:


> Investors will NOT kill Uber and lose their entire investment. However, they may take radical action to save the largest possible part of their investment.


How?
Can they sell off the assets?


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## Nomad (Jul 30, 2015)

Michael1230nj said:


> The Article glosses over the Drivers Dissatisfaction.


So it's just like every other article ever written about Uber's problems.


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## ABC123DEF (Jun 9, 2015)

TwoFiddyMile said:


> How?
> Can they sell off the assets?


Um...assets?


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## Maven (Feb 9, 2017)

TwoFiddyMile said:


> How? Can they sell off the assets?


I have no idea how, but there are many ways. Yes, assets are commonly sold off to pay creditors. For more investigate hostile takeovers and disposition of bankruptcies. One extreme possibility is to merge with a smaller company, like Lyft to get their proven management team.


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## Michael1230nj (Jun 23, 2017)

In the past I have thought that Travis was a Hard Driving take no Prisoners kind of Personality. But for a Large Investor to have to go Public before the IPO and file Law Suits against Him Personally. Makes me think maybe he's really Unstable.


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## TwoFiddyMile (Mar 13, 2015)

Michael1230nj said:


> In the past I have thought that Travis was a Hard Driving take no Prisoners kind of Personality. But for a Large Investor to have to go Public before the IPO and file Law Suits against Him Personally. Makes me think maybe he's really Unstable.


Could be!


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## Mars Troll Number 4 (Oct 30, 2015)

Maven said:


> I have no idea how, but there are many ways. Yes, assets are commonly sold off to pay creditors. For more investigate hostile takeovers and disposition of bankruptcies. One extreme possibility is to merge with a smaller company, like Lyft to get their proven management team.


the FTC would never allow that.

the FTC denies these sorts of deals when they pop up all the time.

Uber and lyft can't buy each other out or merge because undeniably it would substantially lesson competition, and quite probably create a monopoly.

https://www.law.cornell.edu/uscode/text/15/18

15 U.S. Code § 18 - Acquisition by one corporation of stock of another

No person engaged in commerce or in any activity affecting commerce shall acquire, directly or indirectly, the whole or any part of the stock or other share capital and no person subject to the jurisdiction of the Federal Trade Commission shall acquire the whole or any part of the assets of another person engaged also in commerce or in any activity affecting commerce, where in any line of commerce or in any activity affecting commerce in any section of the country, _*the effect of such acquisition may be substantially to lessen competition, or to tend to create a monopoly*_.


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## Nomad (Jul 30, 2015)

Mears Troll Number 4 said:


> Uber and lyft can't buy each other out or merge because undeniably it would substantially lesson competition, and quite probably create a monopoly.


There are plenty of monopolies operating in the face of our anti-monopoly laws. The cable companies have operated as monopolies in their respective areas for decades and I'm still not 100% sure that satellite has unhinged that. Luxottica owns every single brand of glasses ever made. Sirius/XM Radio. Google. Microsoft. Intel. All monopolies.

The proven rule is that if you've got enough money, you can do whatever you want. Uber may be the new kid on the block when it comes to that, but I'm pretty sure "With enough money and influence, we can do what we want" is in their Mission Statement.


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## Maven (Feb 9, 2017)

Mears Troll Number 4 said:


> the FTC would never allow that.
> the FTC denies these sorts of deals when they pop up all the time.
> Uber and lyft can't buy each other out or merge because undeniably it would substantially lesson competition, and quite probably create a monopoly.
> https://www.law.cornell.edu/uscode/text/15/18 ...


You poor baby, still using common sense, thinking like an intelligent adult, and coming to sensible, but completely irrelevant conclusions. You need to think like a lawyer, how to defeat the spirit of the law, while sticking to the letter of the law. It quite easy if you redefine the terms. A monopoly in ridesharing is irrelevant if the issue is public transportation. In that case, a Lyft/Uber merger will face significant competition from Taxis, buses, streetcars (trollies), ferries, subways. airplanes, etc. If that does not work for the Lyft/Uber merger then what Nomad suggests will.


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## Mars Troll Number 4 (Oct 30, 2015)

Nomad said:


> There are plenty of monopolies operating in the face of our anti-monopoly laws. The cable companies have operated as monopolies in their respective areas for decades and I'm still not 100% sure that satellite has unhinged that. Luxottica owns every single brand of glasses ever made. Sirius/XM Radio. Google. Microsoft. Intel. All monopolies.
> 
> The proven rule is that if you've got enough money, you can do whatever you want. Uber may be the new kid on the block when it comes to that, but I'm pretty sure "With enough money and influence, we can do what we want" is in their Mission Statement.


Well..

A. the cable companies are run as utilities and regulated as such,
B. It's possible for a company to become a monopoly under the current laws, however a buyout is a different matter.
C. Intel has a competitor, AMD
D. Microsoft... yeah pretty much, I have no explanation
E. Sirius/XM isn't a monopoly because there are other ways to get music. Spotify, pandora, local radio, to name a few... that's also what the courts decided.

Uber claiming 75% market share to lyfts 25% will come back to haunt them, badly. Just claiming this over the last few years is ammunition against these claims.

Also I doubt a merger/buyout is around the corner. Lyft could easily stand back, let uber burn, and reap the rewards.


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## Maven (Feb 9, 2017)

Mears Troll Number 4 said:


> ... Lyft could easily stand back, let uber burn, and reap the rewards.


A way can be found to not only make it attractive, but irresistible to Lyft.  All that's really needed to get the ball rolling with joining Uber & Lyft is a "Mergers & Acquisitions" team with the guts to crash a wedding and make the sales pitch, like Tess McGill & Harrison Ford.  Of course, it helps to have a great song by Carly Simon, too.


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## Michael1230nj (Jun 23, 2017)

These are not essential services there will be plenty of competition in years to come Uber is the first they will not be the last.


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## TwoFiddyMile (Mar 13, 2015)

Michael1230nj said:


> These are not essential services there will be plenty of competition in years to come Uber is the first they will not be the last.


There's no profit under $1.20 per mile for either drivers or companies.
Rideshare as it stands now is doomed.
Boost the price, make laws, set limits...congrats, you just invented the taxi.


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## Nomad (Jul 30, 2015)

Mears Troll Number 4 said:


> A. the cable companies are run as utilities and regulated as such


... because they bought their way into that catagorization



Mears Troll Number 4 said:


> C. Intel has a competitor, AMD
> ...
> E. Sirius/XM isn't a monopoly because there are other ways to get music.


While true, that does not disqualify Intel or Sirius/XM from being monopolies. It boils down to opinion on at what point of market share to define a monopoly, but Intel has held roughly 75% market share for a decade. IMO, that's a monopoly.

As for Sirius/XM, the other music options you mentioned were not nearly the size they are now when those two companies joined and had to offer their service for free to garner any hopes of market share in their infant years - not the ideal business plan when referencing open-market competition. I was shocked when they approved that merger, mostly because I was unaware that they had enough money to bribe politicians. 

While Uber holds about the same market share as Intel in its respective market, that market is still in its early stages and extremely volatile. A merger and/or buyout would effectively eliminate that volatility and easily identify a monopoly.

But I completely agree that it is extremely unlikely.


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## Michael - Cleveland (Jan 1, 2015)

Maven said:


> Uber/Lyft investors are not the idiots you make them out to be. While it's true that neither Uber or Lyft has ever made a profit, what investors look at is the valuation of the company. In both cases, the valuation of the company is many times the total amount of money invested (or lost). Uber's valuation peaked at almost $70 Billion on total investments of about one-fifth that amount, an incredible (potential) profit in such a short time. Unfortunately, Uber investors are now very nervous since the valuation has dropped significantly since TK left. TK is actively sabotaging potential CEO replacements. TK's goal? Leaving himself as the only possible replacement.


Except that that $70 Bil in valuation appears to have eroded significantly. I suppose we won't know until there's another round of funding (or the company goes public) but more than one financial analyst is putting the real value of the company as it stands now at around $40 Bil... and that's little more than double what investors have coughed up, ins't it?



TwoFiddyMile said:


> There's no profit under $1.20 per mile for either drivers or companies.
> Rideshare as it stands now is doomed.
> Boost the price, make laws, set limits...congrats, you just invented the taxi.


The fallacy in your blanket statement is that the TNC's do not have a 'per mile' cost. They have a 'per trip' cost, and general operating expenses.
They don't 'pay the driver per mile' -
They _charge_ the driver per mile.

In other words, as longs as TNC can shove 100% of the actual cost of transportation and the labor for that transportation on to the driver, all they have to do is reduce operating expenses (or increase 'fees') to be profitable.


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## TwoFiddyMile (Mar 13, 2015)

Michael - Cleveland said:


> Except that that $70 Bil in valuation appears to have eroded significantly. I suppose we won't know until there's another round of funding (or the company goes public) but more than one financial analyst is putting the real value of the company as it stands now at around $40 Bil... and that's little more than double what investors have coughed up, ins't it?
> 
> The fallacy in your blanket statement is that the TNC's do not have a 'per mile' cost. They have a 'per trip' cost, and general operating expenses.
> They don't 'pay the driver per mile' -
> ...


Creative. You are the only person to have ever made the suggestion on UPnet that "Uber charges the partner per mile". I'm not saying it's an untruth, because there is always an allegory to any equation.
All I'm asking is SHOW THE MATH.
If it's that transparent, please draft out the number in any one specific market then create a separate thread and make it a sticky.

I've paid transparent "per mile" fees for taxis in the distant past. The company paid for gas. They charged a base fee of $25 and I think between .64 and .70 depending upon dayshift or nightshift.
The reason for this was concrete- Boston Cab Association owned all these cars and wanted compensation for every mile.
What you propose has no logic- Uber and Lyft own no cars there is no justification for the concept of percentage of dollars per mile charged.
If they don't own the car, they make the owner donate equity from the car to the TNC Company. It's based on the ignorance and stupidity of the partner.
There is no direct charge per mile or percentage thereof.


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## Michael - Cleveland (Jan 1, 2015)

TwoFiddyMile said:


> Creative. You are the only person to have ever made the suggestion on UPnet that "Uber charges the partner per mile". ... There is no direct charge per mile or percentage thereof.


Nonsense.
You're not an Uber driver so you may not be aware of it, but that is exactly how our 'earnings' and Uber's 'fees' are described in the Uber driver agreement.


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## TwoFiddyMile (Mar 13, 2015)

Michael - Cleveland said:


> Nonsense.
> You're not an Uber driver so you may not be aware of it, but that is exactly how our 'earnings' and Uber's 'fees' are described in the Uber driver agreement.


Show the MATH formula. Tis you who must prove your own thesis


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## Michael - Cleveland (Jan 1, 2015)

TwoFiddyMile said:


> Show the MATH formula. Tis you who must prove your own thesis


*4.1 Fare Calculation and Your Payment. *
*You are entitled to charge a fare for each instance of completed Transportation Services provided to a User that are obtained via the Uber Services* ("Fare")...​
*4.4 Service Fee. *
In consideration of Company's provision of the Driver App and the Uber Services for your use and benefit hereunder, *you agree to pay Company a service fee on a per Transportation Services transaction basis* calculated as a percentage of the Fare determined by the Fare Calculation​


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## TwoFiddyMile (Mar 13, 2015)

Michael - Cleveland said:


> *4.1 Fare Calculation and Your Payment. *
> *You are entitled to charge a fare for each instance of completed Transportation Services provided to a User that are obtained via the Uber Services* ("Fare")...​
> *4.4 Service Fee. *
> In consideration of Company's provision of the Driver App and the Uber Services for your use and benefit hereunder, *you agree to pay Company a service fee on a per Transportation Services transaction basis* calculated as a percentage of the Fare determined by the Fare Calculation​


Lol.
There's no per mile fee mentioned anywhere there.
They charge a percentage of the fare.


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## Maven (Feb 9, 2017)

Can you two math-a-letes please take this way-off-topic, two-party (nobody else is participating) discussion into a private conversation?
To simplify, I even started the conversation for you guys
https://uberpeople.net/conversations/your-discussion-to-date-please-continue-here.134286/


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## TwoFiddyMile (Mar 13, 2015)

Maven said:


> Can you two math-a-letes please take this way-off-topic, two-party (nobody else is participating) discussion into a private conversation?
> To simplify, I even started the conversation for you guys
> https://uberpeople.net/conversations/your-discussion-to-date-please-continue-here.134286/


I appreciate the labor you put into this, but Michael is really not my type- too argumentative and rarely if ever concedes a point won.
I'm satisfied with the point I made.

Thanks for playing


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## Michael - Cleveland (Jan 1, 2015)

TwoFiddyMile said:


> I appreciate the labor you put into this, but Michael is really not my type- too argumentative and rarely if ever concedes a point won.
> I'm satisfied with the point I made.
> 
> Thanks for playing


lol!
My friend, there is no point to concede. It may be we are talking apples and oranges, but you said that the TNC's can't make money under $1.20/mile - and all I did was point out that only the drivers , who bear 100% of the 'cost per mile' of rideshare, are the ones who can't make money. The TNC's do not have a per-mile expense... only per mile revenue.


> There's no per mile fee mentioned anywhere there.
> They charge a percentage of the fare.


Exactly! They (TNC's) charge drivers - and drivers pay them. 
(btw: while they set the rider's FARE at whatever they want, they calculate what they charge drivers based on "base fare + time + mileage" - which only underscores the point).
That's not an argument - it's a factual observation.


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## UberProphet? (Dec 24, 2014)

Michael - Cleveland said:


> all I did was point out that only the drivers , who bear 100% of the 'cost per mile' of rideshare, are the ones who can't make money. The TNC's do not have a per-mile expense... only per mile revenue.


It seems to me that insurance must be a per mile expense.


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## Michael - Cleveland (Jan 1, 2015)

UberProphet? said:


> It seems to me that insurance must be a per mile expense.


Why? (And I'm sure you can imagine all of the different types of insurance the TNCs carry)

Insurance quotes may be based on expected miles to be covered (among a lot of other factors), but do you really think that a carrier invoices a customer based on the exact number of miles that customer's independent contractors drive? <shrug> You may be right - but I'd be pretty surprised if that's how it's done.


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## UberProphet? (Dec 24, 2014)

Michael - Cleveland said:


> Why?


Because the risk is proportionate to the miles driven. The risk is not proportional to the number of cars or the hours logged on the app. The fee has to be mileage based. No other risk assessment method makes sense for rideshare. The fee per mile has got to be adjusted by the state (CA costs more than IA) but ultimately the premium must be mileage based.


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## Michael - Cleveland (Jan 1, 2015)

I hear you - and agree that over-all mileage matters, but it's only one of many other risk factors. Think about it - if the only thing that mattered was miles, then we would all be paying on our personal policies 'by-the-mile'... not annually based on an average of x miles per year. 

The TNC's don't purchase insurance coverage for each car or each driver, or each mile driven by each driver. They purchase liability insurance coverage for their over-all business (yes, priced to them based on estimated over-all drivers, cars and miles (and riders) driven.


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## UberProphet? (Dec 24, 2014)

Michael - Cleveland said:


> I hear you - and agree that over-all mileage matters, but it's only one of many other risk factors. Think about it - if the only thing that mattered was miles, then we would all be paying on our personal policies 'by-the-mile'... not annually based on an average of x miles per year.
> 
> The TNC's don't purchase insurance coverage for each car or each driver, or each mile driven by each driver. They purchase liability insurance coverage for their over-all business (yes, priced to them based on estimated over-all drivers, cars and miles (and riders) driven.


We sort of agree. I never said the only thing that matters to the fee is mileage. I simply assert that the calculated insurance fee is mostly a function of mileage.

I disagree that Uber does not buy a policy for each and every car and driver. They most certainly do. Even if, from your point of view, they simply add the car and driver to their schedule of vehicles and drivers covered.

The rate they get charged per mile driven is probably determined using the other risk factors you mention. An under 25 driver costs more per mile? A 67 year old driver costs less? Urban San Fran more than rural Alabama? Male vs female? Charge more for Florida? (I"m for that) Day vs Nite? State by state requirements? I imagine every driver gets assigned a rating and every car gets assigned a rating and each drivers per mile fee is on a matrix. Then it is a simple matter for Uber to report to James River their matrix fee and the number of miles driven on a daily basis by each driver. James River uses this and claims history to adjust the matrix fee periodically.

I don't know this but that is how i think it is done.


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## tohunt4me (Nov 23, 2015)

Jo3030 said:


> Opinion


The Board of Directors needs to GET BUSY !



Uberyouber said:


> Uber does a good job of killing itself..


Uber is their own worst enemy.



Another Uber Driver said:


> As long as the riding public presses a button and a ride shows up, no one cares about Uber's internal "problems"; no one: really, no one. When the ride stops showing up, people will pretend to care, will not like the answer and will try something else or go back to what they used to do before there was Uber or Lyft.
> 
> This assumes that if Uber and Lyft do collapse, no other TNC would rise to take their places. That is a whacked-out assumption. In fact, the argument could be made that it is a textbook illustation of what happens when you ass*u*me.
> 
> Still, should it occur, and, the possibility that it would occur is remote, but, should it occur, people will go back to subways, busses, cabs, blue vans, van services, their freinds, their own cars, bicycles, their feet or whatever.


I could envision a Govt. Bailout of Uber.


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## Michael - Cleveland (Jan 1, 2015)

UberProphet? said:


> We sort of agree. I never said the only thing that matters to the fee is mileage. I simply assert that the calculated insurance fee is mostly a function of mileage.
> 
> I disagree that Uber does not buy a policy for each and every car and driver. They most certainly do. Even if, from your point of view, they simply add the car and driver to their schedule of vehicles and drivers covered.
> 
> ...


Maybe our resident insurance expert can shed some light? BradSussmanInsurance


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## tohunt4me (Nov 23, 2015)

Maven said:


> Can you two math-a-letes please take this way-off-topic, two-party (nobody else is participating) discussion into a private conversation?
> To simplify, I even started the conversation for you guys
> https://uberpeople.net/conversations/your-discussion-to-date-please-continue-here.134286/


That Maven . . .

Yup


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## ABC123DEF (Jun 9, 2015)

tohunt4me said:


> The Board of Directors needs to GET BUSY !
> 
> Uber is their own worst enemy.
> 
> I could envision a Govt. Bailout of Uber.


Forget that...let 'em burn!!


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