[xapata]

I'm too lazy to do that. I used to have 3, then uninstalled Fasten. Now I have both Lyft and Uber and am considering uninstalling Lyft because I never use it.

Why should I waste time tapping on a different app, waiting for it to load, tapping through the destination, etc.? The estimated wait times aren't accurate to the minute, so +/- the error they are almost always equivalent. Enough so that checking the other app feels like a waste of time. In the time it took to load the other app, I could have been waiting for the car to arrive. It's not worth the mental energy to choose.

Further, Uber has a prepay promotion. I pay an amount at the beginning of the month to avoid surge charges and get a discount through the rest of the month. I'm basically locked-in for any month that I prepay.

[ethanbond]

Here's an anecdote to explain how awful of a position Uber is in.

As mentioned elsewhere, I use Juno almost exclusively in NYC when traveling for personal reasons. How did I end up using Juno?

First, I was offered a steep discount via beta invite. By whom? My Uber driver. Problem 1. I sat on the invite for a few weeks through which I had numerous bad experiences with Uber (long wait times, bad drivers, second riders calling while I was in the car, etc.) Problem 2.

I called an Uber and it gave a 15 minute pickup time. Problem 3. I cancelled, found the Juno invite, downloaded the app, made an account, and was in a car within 10 minutes. Problem 4. The Juno driver and car was better than most recent Uber rides, the app was just as good as Uber's, and it cost me about 70% of the money. Problem 5.

So what exactly is Uber buying with these promotions? Another week of sub-15 minute pickup times by overworking their drivers? They're certainly not buying loyalty, nor any meaningful market share. No matter what they do, I'm <10 minutes from a competitor's car.

As the service degrades in order to meet profitability demands (you do believe in basic finance: money in minus money out, right?), the calculus turns ever towards the competitor's favors. These young competitors are simply doing what young Uber did to the cabs: attract higher quality drivers in higher quality cars and higher quality riders, subsidize the hell out of it, and then figure out what to do.

They probably won't last either, but then none of them have to justify a $50bn valuation with a moonshot bet on technology that's not even close to being able to support the core of their business.

[xapata]

> promotions don't buy their way out

I'm not talking about a give-away. A prepay program is similar to an airline loyalty program. Delta can charge me higher ticket fares than a competing airline on the same route, because it's good for me to consolidate my "miles" with one airline. Now that I'm "elite" they can manipulate my ego and get me to pay more so I have a chance at a "free" upgrade to a fancy seat.

If Uber can convince me to prepay, they don't need to compete on price or wait time for the rest of the month. It only needs to be a good enough value to convince me to prepay again the next month.

Going back to the airlines, that industry is quite similar to Uber's. Sure, there's the capital investment in airplanes, but that can be financed with debt or equity. There's negotiating terminal space, but again, that's just money. No barrier to entry there either. Now, the airline industry is a good example of a place it's tough to make money. "How do you make a million bucks? Start with a billion and start an airline." But the airlines are still around. Not sure why Uber is different from Delta.

[ethanbond]

You really think starting an airline is as easy as starting an Uber competitor? Yeah I guess besides the gargantuan barrier to entry.

I've got a bridge to sell you.

No point in discussing this further, really.

[xapata]

You think running an Uber competitor is easier than running an airline? I've got a great investment for you...

If a barrier to entry is just financial, it's no barrier at all.

Let's think through the dynamics of the situation you describe. You say Uber is doomed because competition is too fierce. Yet you say the competitors are also doomed. Somebody will go bankrupt first. That will reduce competition and profits will go up. Maybe another competitor shows up and it's back to doomed. But then they go out of business, too. Eventually, people will stop entering this doomed industry and if Uber is still around, it'll start turning a profit. Every industry goes through times of competition and times of consolidation.

[andyzweb]

>You cannot give away money and expect to have more money than before you gave it away.

In the valley this is the most effective way to raise money.