[hackuser]

> There is zero lock-in. If Lyft is cheaper this week, I'm riding Lyft.

It makes sense, but I'm not sure it works out that way. Many web services have zero lock-in (not including those with a network effect such as Twitter and Facebook) and competitors are a URL away, yet the first ones to gain (mindshare? marketshare?) seem to keep it: Google search, Amazon, etc.

[greglindahl]

Google was the first search engine? Actually, the field was crowded when Google appeared.

[jimmywanger]

Amazon was definitely not the first ecommerce site either.

[slackstation]

Google has superior search results. FB/Twitter are where all my friends are. Amazon has network effects with Prime that are more than just free next day shipping.

Uber takes me from point A to point B in a virtually indistinguishable way than Lyft or any of the other smaller ride sharing services. The most important thing is the transport, not the comfort, not the branding, not the "Lifestyle Experience". Maybe they will succeed because all of these people want something more out of a ride other than the ride but, for me it's cheap, reliable, fast; in that order. Everything else if fluff.

[icebraining]

Services like UberPool/Lyft Line do benefit from winner-takes-all effects, as the service that can keep its cars full can offer lower prices.

[sogen]

Just a note: There were many search engines with a lot of market share before Google (i.e Lycos).

[kjksf]

Yes, but not really.

Google search was the first one to find a business model for pure search (adsense i.e. advertising based on your search terms).

That allowed them to build the best pure search experience they could and was so profitable that they could spend more money building it than anyone else. That's a virtuous cycle.

Their competition at the time was moving away from pure search (because it was unprofitable for them) into yahoo-like portals, because that's where the money was (also ads but non-contextual display ads).

Which is why that's not a good analogy for uber.

In U.S. there's really Uber and Lyft. Every time Uber is discussed, "no lock-in" comes up but why no one even tries to compete with Uber and Lyft in US?

It does seem like people who actually have the money to potentially mount an attack on Uber or Lyft came to the conclusion that it would be a foolish waste of money.

Uber and Lyft have a clear business model: they are better and cheaper than taxis and have global presence (while taxi companies are historically local and don't have the capital to go global).

Customers in this market do care about price and better service, so it's rather obvious that Uber and Lyft will win over taxis (arguably they already won given that they're 100x bigger than any taxi company).

Both Uber and Lyft are still in the phase of aggressive expansion and growth, they still enter new markets, subsidize the service to increase usage density (which makes the user experience better), they experiment with things like Uber Pool, being alternative to busses etc.

None of the above is cheap so it's understandable that they loose money today.

But at some point the growth will stop, their costs will go down and one of them (or even both) will be very profitable companies.

The only thread for Uber and Lyft are self-driving cars (i.e. Google, Tesla, GM) because they'll drive costs down by 5x. Whoever wins that race wins the taxi business, which is why Uber spent $680 million on Otto and GM $1billion on Cruise and Google was apparently paying $120 million to a single individual in charge of self-driving cars.

[InclinedPlane]

Google and amazon won the market because they made a better product. Before google search was clumsy and slow, it was just bad. But people still went to search sites because where else are you going to go? Most other search sites (yahoo being a prime example of one that existed before google and still survives) decided not to try improving search (which was too hard) but rather to bolt on additional features, to make their web-site a "portal" by providing directories, other services, games, etc. Portal sites were all the rage in the late '90s. But then google came around and knocked it out of the park with a rethink of search. They took cutting edge CS and software engineering in the form of pagerank and map/reduce and married it to an equally cutting edge model for running web apps in the form of sharded multi-host metacomputers and then hosted it on a clean, fast loading page. The result was that google could produce better results faster and at lower ammortized systems cost than the competition, and the clean UI made the site more usable. Instead of taking 5 seconds per page to return a result that might have something worthwhile on like page 3 google returned a page full of high quality results in a fraction of a second. That's why they won. And it's how they made money too because they could provide more targeted and less intrusive ads (based on search terms) and they could make less money per ad while still making more money overall (because their cost per search was so low).

Amazon figured out how to marry a familiar and easy to use web-based store to a state of the art fulfillment pipeline, which is how they took over the market. Fulfillment is a non-trivial problem. Keeping track of what is where and how much is left, figuring out what to charge for shipping and handling, and figuring out where to keep stock and how to produce orders. A typical web-based shop will get to your order in one or two business days and be able to put it in the mail maybe that day or a day later. Amazon figured out how to optimize everything about their systems to be able to get your order in the mail within hours of you placing it. They've consistently been improving that process for years, and almost nobody can keep up with them. They can achieve same day delivery on a lot of common items in many metro areas, for example.

If Uber was as superior to the alternatives as Amazon or google was they wouldn't have any problems keeping marketshare. But they really aren't that much different than Lyft or other ride hailing apps. The core valueadd comes from being able to use a smartphone to set up your ride instead of having to place a call or having a cab be immediately visible to you. There's not enough that Uber brings to the table otherwise which would allow them to keep their business if they couldn't subsidize fares using VC money.