I think the crucial point here is really that uber's two-party networks are city-wide.
Yet because Uber is operating globally, it's falsely being valued as an international two party network.
There is no future where Uber is profitable and there isn't someone with deep pockets who wants to undercut them starting with their most profitable markets.
Most riders don't have much customer loyalty, they just want the cheapest price. Drivers don't mind driving for multiple services.
When a deep pocketed competitor launches with zero market share, they can compete with lower prices. If Uber responds too early, Uber would need to cut down prices on their full market share. If Uber waits too long, the competitor gets more traction.
In the end it is a zero sum game for Uber, unless they could have used their money and focus to create Autonomous Driving Tech. Not sure if that is going to happen now! Their new CEO's mandate is to do the IPO and get investors their return ASAP.
My prediction:
In the next 2 years, Amazon will enter as an Uber competitor starting with Seattle and then slowly expand to Uber's most profitable markets.
Amazon Flex has been around and growing. It's Uber but the drivers have packages instead of people. It will not be difficult for them launch Uber like services.
The rider network is somewhat global. In any larger city, Uber could probably sustain a minimum viable driver network just from international visitors. This does have value.
But this value is also impossible to defend against the combination of more local networks aggregated by some global directory specialist who follows a low cost/low commission/high volume strategy.
There is no future where Uber is profitable and there isn't someone with deep pockets who wants to undercut them starting with their most profitable markets.
Most riders don't have much customer loyalty, they just want the cheapest price. Drivers don't mind driving for multiple services.
When a deep pocketed competitor launches with zero market share, they can compete with lower prices. If Uber responds too early, Uber would need to cut down prices on their full market share. If Uber waits too long, the competitor gets more traction.
In the end it is a zero sum game for Uber, unless they could have used their money and focus to create Autonomous Driving Tech. Not sure if that is going to happen now! Their new CEO's mandate is to do the IPO and get investors their return ASAP.
My prediction:
In the next 2 years, Amazon will enter as an Uber competitor starting with Seattle and then slowly expand to Uber's most profitable markets.
Any bets :)