> It is the same with the cab companies. It took Uber and Lyft for them to lift a finger and actually attempt to innovate and make it better for customers
This is a complete rewriting of history.
The reason Uber "won" is because they operated on a loss. The reality is that running a Cab business typically has low overhead. You use phone lines, maybe a website, and then pay for cars and maintenance.
Uber "innovated" the field by doing the exact same thing with MUCH higher operating costs. How did they provide a cheaper service then? That's the kicker, they never have. They just ate the loss.
Cabbies, unfortunately, cannot work for a negative wage. Uber can pull that off then. And so, for 14 years, they never turned a profit. Losing hundreds of millions a year.
And that's how they won.
Of course, now Uber is actually more expensive than your average cab. Which makes complete sense when you consider calling someone's phone has got to be a lot cheaper than running one of the largest networks in the country.
And, is it really more convenient to tap around as opposed to make a call or even just stick out your hand? Maybe. But I think when it's double the price, people won't feel this way.
I got an uber the other day, had to wait 5 minutes for it. There were some taxis sat outside the station, but I chose uber because
1) I know it will take card. Last time I took a taxi the "card machine was broken" and "I'll drop you at an ATM"
2) I know I'll get a receipt, as a PDF, which I put into my expenses. Taxi drivers tend to be very grumpy about giving receipts
3) I know I won't get adverts - maybe this is just a New York thing, but last time I took a yellow cab in New York I was bombarded with adverts
4) I know I'll be going to the right place, without having communication difficulties and ending up at the wrong hotel or whatever
Price doesn't come into it.
And if uber can't gets its operational costs down below a taxi firm paying for a dispatcher and manager to handle paperwork etc, given the scale they operate at, then they really need their tech stack sorting.
Not true, price did come into it, you just decided the price differential was fair. If Uber was 1000x more expensive then you wouldn't have taken it, even if they massaged your feet and kissed your forehead.
> And if uber can't gets its operational costs
They can't, because the idea itself is flawed. Taxi companies don't need a tech stack. It costs very little to pay some bloke 10 bucks an hour to operate a phone. Paying hundreds of software engineers is very expensive, and it doesn't really matter if you switch away from Ruby or whatever. That's the least of their worries.
Again, this is a rewriting. I'm sure this played a role, but Uber fares are not actually fixed! There's no "per mile" rate, the algorithm is a complete black box! They won because they were cheaper for the consumer.
As someone who grew up in NYC, lol. Taxis were horrible and tried to rip you off at least 20% of the time. Ubers have a transparent rating mechanism and transparent pricing.
Uber has a rating mechanism. They do not have transparent pricing and have a history of building tools to misrepresent their activities to legal authorities so nobody can trust them not to play games with pricing at any time in the future.
Better than cabs were 15 years ago but we should expect more transparency.
I trust Uber somewhat more than a taxi driver. So far Uber's worst to me was rides not showing up, with taxi drivers I've been essentially robbed (and in most of the world, that it was only "essentially" means I had a not so bad experience).
No really, taxis were the first thieves of the world, on paar with politicians.
Look, I went to Russia, I took Yandex Taxi. I went to Indonesia and took Grub. Whether you pay double of half is i consequential compared to “Yes I take credit cards” then “Oh my credit card apparatus doesn’t work” then “Let me find an ATM for you, at your expense”.
The one brand than invested on marketing is for nothing in the death of the taxis; Everyone was wishing they’d disappear.
The price was the cherry on the cake, the bottle of water was the finger to every awful taxi driver that has existed in history.
From a country which suffered from a notorious taxi mafia which is now basically extinct, Uber isn't game changing because it is cheaper.
It is game changing because now the drivers have a reputation from their previous customers and you know you won't be treated like a stupid mark at best, or sexually assaulted etc.
THAT was the game changer and good riddance to bad rubbish. Even such "tiny" details as the cars being clean and not smelly are, in fact, a major improvement in quality.
Old-style taxi guys had zero incentive to keep their cars clean. Many smoked in them outright.
Did you never take a cab pre Uber? It was a poor experience. At best it went ok. But you have to be constantly paying attention, know the local roads (when on vacation/business that didn't work, or even when it did, you are having to straight call out old boy for being a scummy scammer and taking the wrong streets), deal with the 'sorry the mileage ticker is broken' 'sorry I can't take credit cards' after saying they did at the start. Uber fixed a TON of that experience.
Sure, but again, I know many people and I think consumers as a whole would happily take a shittier product if it's half the cost. The reason Uber won is because they were competitive in price. If they were not competitive in price, which they aren't now, then I am extremely confident in saying they would've went nowhere.
I've seen Uber come up with the most outrageous routes to take me around NYC, so I don't think this is true at all w/r/t to being something that Uber "solved."
"Cabbies, unfortunately, cannot work for a negative wage. Uber can pull that off then. And so, for 14 years, they never turned a profit. Losing hundreds of millions a year."
I'm not even talking about the wage aspect of the business. Before Uber and Lyft, getting a cab was inconvenient. Mostly telephone or hailing it in-person. Uber and Lyft forced them to innovate. There are now apps available to get a cab in almost every major city.
Why did it take the Uber/Lyft disruption to get something like this? Because the cab companies didn't need to compete and the unions kept this monopoly in place.
I fail to see how using an app is more convenient than hailing in person or using the telephone.
What happens if you don't have the app or don't want to download it? We really have to sit down and make an account and do all this bullshit?
It's "more convenient" because you've been influenced. But, certainly, I can make a phone call faster than calling an uber. And I can do it without any data or without even a smartphone. In actuality, it's not more convenient, it's just less human.
Cabs refused to innovate. Before Uber the process to obtain a cab meant using a phone to call a human to radio a driver in a vehicle. It was obvious in the year 2005 that booking through the internet was going to happen.
Yeah that's nonsense. Uber/Lyft "won" because hailing a cab was - and still is - a shitty experience. The cab industry was unapologetically exploitative and I will Not. Shed. One. Tear. for it.
> because hailing a cab was - and still is - a shitty experience
Consumer don't actually care that much about this. They care about price - they're very price sensitive. Uber WAS cheaper, so they won. The experience being better matters a little, but not much. And, again, it's not that much better! Certainly, I can catch a cab much faster than an Uber, and consumers are also time sensitive!
> unapologetically exploitative
As opposed to Uber, who categorizes all their employees as "gig" so they don't have to pay out benefits. And they don't take on any risk with the capital, the employees bring their own capital.
Uber is extremely exploitative both to you, the consumer, and to workers. For you, you're not offered a fix rate. Your rate per mile varies by the minute and by who you are - not unlike a scammy Taxi. The difference is the Taxi's at least would sometimes not be scams and advertise a rate, this is not the case with Uber.
| Consumer don't actually care that much about this. They care about price - they're very price sensitive. Uber WAS cheaper, so they won. The experience being better matters a little, but not much. And, again, it's not that much better! Certainly, I can catch a cab much faster than an Uber, and consumers are also time sensitive!
You are rewriting history here. Most NYers have a story about a cab that either tried to take them for a ride and take a shitty route, charged them an exploitative fee to return their cellphone, had their credit card machine "break" until you insisted you didn't have any cash and it was either a CC card or you are getting out right now... etc. There was absolutely no accountability for them at all and Uber fixed this problem- getting a ride is now actually pleasurable and everything is negotiated up front with no haggling and a full paper trail.
Your whole argument is ridiculous, not sure what your axe to grind against Uber is, but its clear you are not being objective here.
I am very much being objective here. Uber won despite having an objectively worse economic model, because they cheated via venture capital. It happens all the time in the tech world.
Tech company comes in, "innovates" by providing a product that's 2x as convenient for 10x the cost, and undercuts competitors by cheating.
To be very clear, Uber IS absolutely a better experience than taking a cab, and I've noted this multiple times. I believe, however, it's not convenient ENOUGH to justify the extreme infrastructure costs.
From an economic standpoint, Uber does not make sense. If you wanted to run an Uber service at that scale, it would be beyond expensive. Customers don't want to pay 20 bucks to go a few blocks down. So if that was the case from the beginning, Uber would have been dead in the water.
You're greatly underestimating how cost sensitive consumers are. Most people will willingly take a less convenient and shittier option if it's cheaper.
We are just in opinion territory here, but Uber was originally more expensive generally than NYC taxis, but it took off anyway. If everyone was so cost sensitive, why isn't everyone taking the subway?
Well first off people do take the subway. Lots and lots of people. But if subway doesn't go where you need it to and you're in a time crunch, you take a taxi or uber.
Second off, even if Uber is more expensive that's still not it's true cost. You, or anyone, would be happy to take an uber if it was 1.15x the cost of a taxi. Because that's worth it for you.
But this is the big idea here:
"Tech company moves in a provides a product that's 2x as convenient for 10x the cost"
There's a point where it makes no sense to get an Uber, and we're well past that point. Uber made it only because they could hide the true cost.
Uber IS a better experience. But would you pay, say, twice as much for a better experience? I would say for most people the answer is no. Not for a transportation service.
When you're making a product it doesn't matter how amazing it is if it's too expensive to produce. There's some exceptions for some product categories, but ultimately operating inefficiency will bite you. From an economic standpoint, Uber does not make sense and has never made sense. Point blank, it's a stupid idea. As time goes on and Uber prices go up and up to try to make up their billions of dollars of losses, you will see this first-hand.
The world is bigger than NYC, and even New York is bigger than NYC.
you are right about Uber bringing accountability, but Europe solved that through regulation. NYC could have done that-- the right to run a cab is linked to owning a government-issued medallion-- but regulation is not the US way.
Medallions only apply to yellow cabs and the green outer borough taxis. Any New Yorker will tell you stories of hail (yellow) cabs not stopping, not driving minorities, not driving to locations in the service area or not being present outside Manhattan. Calling for a cab, van, car service or limo does not require a medallion.
>You are rewriting history here. Most NYers have a story about a cab that either tried to take them for a ride and take a shitty route
I've had Uber try to go through the Throggs Neck Bridge, over to the Triboro in order to take me to LIC from eastern Queens. Of course the Uber driver, who only spoke Chinese had no way of understanding why this was incredibly and obviously stupid.
Yeah, maybe to people from out of town. I didn't say cabs were perfect, but people are acting like Uber is beyond reproach and I don't think it is and I find taxis incredibly convenient and are almost always a better deal, and I lament how few of them there are now which is due entirely to Uber. The experience in an uber is not really that much better, people used them because they were much cheaper.
Consumers like knowing the price for a trip before taking it so they can decide if it's worth it or not.
I have no problem with variable pricing, provided it's stated before I agree to pay, not after. It can't be a scam if customers have full information before they agree.
> It can't be a scam if customers have full information before they agree
It absolutely can be, if customers don't know how that price is generated, which you don't. You agree but you don't have the full facts. Your friend could be paying half and you're getting ripped off.
And, to be clear, many taxis before Uber did actually advertise their rates. This is the same situation then, but even better, because you know your rate isn't for you, it's for everyone.
This is a complete rewriting of history.
The reason Uber "won" is because they operated on a loss. The reality is that running a Cab business typically has low overhead. You use phone lines, maybe a website, and then pay for cars and maintenance.
Uber "innovated" the field by doing the exact same thing with MUCH higher operating costs. How did they provide a cheaper service then? That's the kicker, they never have. They just ate the loss.
Cabbies, unfortunately, cannot work for a negative wage. Uber can pull that off then. And so, for 14 years, they never turned a profit. Losing hundreds of millions a year.
And that's how they won.
Of course, now Uber is actually more expensive than your average cab. Which makes complete sense when you consider calling someone's phone has got to be a lot cheaper than running one of the largest networks in the country.
And, is it really more convenient to tap around as opposed to make a call or even just stick out your hand? Maybe. But I think when it's double the price, people won't feel this way.