This is really interesting. I believe this might be attribute to all the Uber promotions in Asia. I have heard from all my friends in India/China that Uber rides are actually free for around 10-15 rides. Also, they are giving tons of money to Drivers to promote Uber in India.
An average Uber driver in Bangalore earns 110000 INR per month where as
an entry level software engineer in GOOG/AMZN in India earns 80000 INR/month.
I was shocked that one of my friends who drove Uber in Bangalore told me that he made 180000 INR two months back.
It would be interesting to know Uber's customer acquistion cost and driver acquisition cost.
I'm still surprised that Uber is entering such competitive markets. I mean, in much of the western world, they're using a mobile app to side step cab hailing laws and break long standing taxi oligopolies. Does anyone know what market flaws they're solving in India and Asia?
The same is true in New Zealand, where the only real requirements to be a taxi are around having a passenger endorsement to your license and police background checks.
> Does anyone know what market flaws they're solving in India and Asia?
Well the only market flaw they appear to be solving here is that they aren't hoarding more of the money in the market...
In NZ the advantage is convenience and cost - you can get a ride far faster, payment is automatic, and the rates are lower, especially for shorter trips, than the incumbent taxi companies.
Some of the local competitors have some of that (e.g. Zoomy), but they charge extra fees for paying though the app which makes them expensive, and also means you need to go through more of a process when the ride is finished.
I don't like how uber flaunts the law in so many places, but their competitive advantage doesn't come from non-compliance.
The service is plainly better. The cars are better, the drivers are rated, payment is easier, hailing is easier, knowing where your cab is and how long it will be and how much is will cost before you start your ride ... is better.
I live in the Twin Cities ... not a place where cabs are dense enough to just hail one walking down the street (unless it's in a prime drinking/sporting hour & location).
Uber, Lyft, and the city of Minneapolis worked together to make uber-like services legal while giving concessions to the local traditional taxi drivers without compromising appropriate regulations. Everyone behaved reasonably which is sadly extremely rare everywhere else.
The running theory is that unreasonable people either leave Minnesota or are found only after the snow thaws (please don't take this too seriously :) )
There is a difference between trying to behave reasonably outside the law starting up while trying fix regulations fairly and in good faith when you get enough attention ... and ostentatious defiance, which is how many would describe Uber's behavior in many circumstances.
There is no behaving 'reasonably' outside the law. It's clear that if they had not won over the consumers, the people who the law is supposed to help, Uber would not exist.
When I went to Delhi, I had to haggle with the tuk tuk driver. In some cities in China, there seemed to be the impression that some taxies were not trustworthy and some people only ride from particular taxi companies. Uber was not in China or India when I last visited, but they do solve the trust problem and I would take them when I visit again.
This is a often understated advantage which Uber brings - the ability to land anywhere in the world and, modulo internet connection, get a safe ride within minutes where you know you won't be overcharged or longhauled.
In China the taxi oligopolies are very strong and the taxis are notorious for poor service. In Beijing, they come with their doors locked and roll the windows down to ask you where you want to go, to see if they feel like going in that direction.
1. Time/Convenience: India does not have a system like America where you can hail cabs, they are only booked via an agency. These bookings need to be made some hours in advance. A pre-Uber thing (which I'm sure is still common in non-metropolotian parts of india) was to book an appropriately sized cab a day before we have a flight or train to catch. With Uber, request an Uber XL and you're done.
2. Price: As expected, these agencies work out to be pretty expensive. Uber is almost 50% cheaper.
I personally use Uber when I'm with people or have luggage with me. Otherwise India does have a very good metro train and also has autorickshaws (aka tuk tuk) but the former is not point to point and the latter seats 3 people at best (and an Uber sometimes works out to be cheaper than a autorickshaw)
I think that currently only a small part of India uses Uber significantly, but those who do have nothing but praise (anecdotal). Uber has better quality and better drivers for a better price. That said, the market seems large enough to warrant competitors like Ola and Meru.
You are overestimating the competitiveness of these markets. In many(perhaps most) parts of India, these operate as unions/ price cartels. The tuk-tuks in particularly ignore meter pricing, in most parts of India, and may resort to violence/harassment to protect themselves from competition. Also most taxis/tuk tuks are independent and do not belong to any company. As such, I imagine they don't enjoy the benefits of economies of scale, efficiencies, and technology that Uber can afford. The quality of service is very poor, which makes Uber something of a Godsend. All these are points on which Uber can and is currently exploiting to gain a foothold, although they face strong challenges.
* I'm yet to have an Uber driver clearly on methamphetamine, but a notable number of taximeter drivers
* No quibbling over the price or trying to overcharge from Uber
* Uber cars always have seatbelts, it's rare to find them in the back seat of taximeters
* Even if the Uber driver doesn't know the place you're going to, they've got a map, and directions, and they'll use them
* No worrying about if you've got sufficient loose change; you can be sure the taximeter driver will have a real shortage currently if you have only big notes
Regular (black and yellow) taxis and rickshaws exist in Mumbai and very few other Indian cities including Delhi. However only in Mumbai do they ply according to a meter. The rest of the cities, they just charge whatever they feel like. Also most cab drivers will refuse to take passengers depending on destination on a regular basis. Maybe 50% of the time. Other radio cab services like Meru (the oldest radio cab service), need at least a half hour for booking. You also need to provide your destination. Also paying cash is a real pain, because most cab drivers will just claim to not have change and try to pocket it.
Uber is a breath of fresh air here. It doesn't force a destination, you can instantly know whether cars are available or not, generally arrives in 10 minutes or so, and there is no cash payment needed.
Where price is concerned, they've now managed to figure out the right pricing, so that an Uber ride costs only marginally more than a regular cab ride. e.g. Home to work takes around Rs 200 for a regular cab. Uber costs anywhere from Rs 220 (Uber X), to 350 (Uber Black).
There are no free rides here in India (at least Mumbai). You get a promo of up to Rs 600 (USD 10) to start with. And that's it. I very much doubt the claims about drivers earning Rs 100,000+. I am going to ask my Uber drivers to and from work about how much they make.
I feel like most of the hatred of Uber is manufactured, and that the people who whip themselves into a frenzy over it are allowing themselves to be manipulated.
OK I will take your challenge. You can read a detailed description of why I hate Uber above (tl;dr: shady practices pushing towards indentured servitude and weaking the very rule of law). What's manufactured of it and how am I being manipulated?
This is from an old post but I think you'll find interesting:
Note on Uber: I think Uber is a great business and has a significantly net-positive impact on society, and I reserve judgment w/r/t whether TK and the other Uber execs are good or bad people - I can't conclude they are good because they run a good business, and I can't conclude they are bad because they say stupid things in public.
Note on Nietzche: In Thus Spake Zarathrusa, the "uberman" concept is (maybe) considered a positive that humanity should work towards in the absence of belief in God, and I think it can still be understood as such. The fact that history has attributed some very negative actions to the belief in this concept (Hitler, Leopold & Loeb's murder, etc.) is, in my opinion, not definitive but at the same time not entirely insignificant, but I'm also a Christian that believes in capital-M Morality so I'm biased against nihilism in general.
here's a thought I had a few months ago: how have there not been more thought pieces relating Uber-the-business's recent/relentless PR-debacles to Nietzsche's Ubermensch concept? I guess I'll give it a go.
Uber/Travis and his execs seem to demonstrate the belief that they are "overmen" in that they seem to believe that they transcend the rules of society and are destined to shape society and its values rather than the other way around (probably something not too uncommonly shared with HN readers…).
A few fun/funny/serious examples (in no particular order):
1. They outrightly express resistance to laws-as-is, and regularly threaten to ignore and sometimes do break those regs as necessary to conduct their business / benefit themselves and their consumers.
2. They hire lobbyists and other high-level political actors to change the laws they don't like and/or influence lawmakers - not atypical for a large company, but they did this earlier than most companies at their stage, with much more specific agendas in place and with a lot more PR surrounding it (the last may or may not have been their doing, hard to say). They have a belief (probably well-founded) that they can use the political process to make the law bend to their will. “Creating New Values” as any good uberman should.
3. They call their central system “Godmode” which implies that they, the viewers, are like God (a bit of a stretch I know…couldn’t resist)
4. They are proud that using the data in Godmode they can track, predict and identify specifics of other human being’s behavior.
5. The whole “we’ll pay our own researchers to smear journalists” thing - another good example of Creating New Values and constructing narratives.
6. The general feeling that Uber (perhaps correctly) operates against “states” and “sovereigns” and “systems” more than corporate competitors (who even writes about Lyft anymore these days…)
The funny thing is that after thinking this through, all (good?) CEOs of major corporations basically operate like this (and so do many other tech-leaders - it is often associated with libertarian-leaning individuals like P. Thiel, etc.) - the difference is that Uber (1) has a name that calls it out and (2) seems to be especially prone to doing this in public and (3) sometimes appears to relishes their “overlord-iness” a little too much. You can call it being crass or being honest.
In any case, they seem to be getting hip to the system and playing nice which of course can be viewed as just another level of the game, etc. - still, glad to see them do it because I overall think that playing nice is best (especially when you can afford to do it) and with a $50b val. and a couple billion raised, I think they can spare some good behavior, at least for now =)
If you're right, it sounds like Uber is merely more public with their politics, and hence might actually serve to bring this "hidden" moral issues to light?
Yes, I think it's good that people are becoming more aware - Uber interestingly had politics block their business much earlier than most, but looking at FB, Google w/r/t data + anti-trust, the decade of tech lobbying is well, well underway. When Apple is almost 2X Exxon-Mobil, it was only a matter of time before tech > oil =)
If you were a taxi driver you wouldn't be happy that you are abiding by the law and a US company comes waltzing in, flouts your countries's laws actively trying to ruin your lifelihood.
Uber is a net positive I believe. Irrespective of what others think of their practices the product is substantially superior to any alternatives I have pwrrsonally used.
I don't think they're doing any 'bogus' things nor do I think the illegality matters. The laws were used to prop up the taxi cartel, I'm glad they are being broken.
It's not about what I want. It's the principle of getting rid of laws which are blatantly anti consumer. Your example does not have any relevance in this discussion.
And just because the cab regulations overshot in many places it does not mean no regulations is the answer. Also, while civil disobedience is laudable the same can't be said from a company. Problem is, what if next time a company finds another set of regulations / laws it doesn't like? This sort of behavior should be killed with fire because it weakens the very rule of law. I know this is not a popular opinion but the French arresting the leaders of Uber in France are going the right direction and more of the same is (badly) needed.
After the story of Night School, people are a lot less inclined to think that making nice with the law will work out well. What we've learned is that attempting to work within the law will get you squished by those you are disrupting before you become big enough to be a threat - or defend yourself effectively.
With that in mind, what do you think the right approach is?
Having worked for financial traders I won't call them the very worst company in the world. But if my choices were working for them or quitting the industry, I wouldn't blink.
For me it's more the accumulation of awfulness. They started out as a scheme to time-share limos among young entitled dudebros. They entered the market with the black cars, exploiting a status-good dynamic. They've shifted all of the capital cost and risk of the taxi business to drivers, surely screwing many of them in the process. Their "we're too important to comply with mere laws" routine strikes me as arrogant horseshit. They've had assorted scandals, including inviting a bunch of journalists to an off-the-record dinner and then "joking" about plans to spend lots of money to destroy the career of a prominent journalist they didn't like. I've lost count of how many places have arrested or issued arrest warrants for their people.
Throughout all of this, they sing a song of "entrepreneurship" and "worker independence" while providing low-quality, low-stability jobs and making long-term plans to put every one of their drivers out of work. They couldn't give a shit about their workers, and are even willing to threaten their jobs (which aren't jobs, of course, but independent contractor positions) if they are politically active.
On top of all of that, I believe they're a great example of the shift back to a new gilded age, where the main function of the poor is to directly serve the wealthy. But instead of a Victorian model where employees are part of the household, in the Uber model we'll get paid only during the instants we are directly useful to somebody with money.
That's just some highlights off the top of my head; the list goes on. They may not be the very worst, but they have an awful lot of people rooting for their fall. I expect they won't go totally bust. But I am looking forward to a Groupon-style outcome once their investor-fueled growth becomes untenable.
My problem with that statement is that it describes every single job you could possibly have, even the very well paying ones. You are always trading your labor to somebody with money, whether it's an Uber driver or the CEO of a major corporation. It's not the "Uber model", it's the money represents an agreed upon denomination to trade goods and services with model.
The important part of wpietri's critique is "during the instants we are directly useful".
The CEO doesn't stop being paid when she walks to the bathroom, and a cashier doesn't stop being paid when he's waiting for a customer to show up. wpietri is talking about a shift in the granularity of trading your labor for money, so that you aren't paid for a day or an hour of work, but for the exact number of minutes you performed useful work.
The shift is away from paying an employee for 8 hours of work--knowing that he will only be performing useful work for some fraction of that time--towards paying the same employee only for the time spent being productive.
Since most people aren't able to work productively for an entire 8 hour shift, this change probably means a net decrease in wages.
We've already started to see this with computer scheduling in retail. Assigning split shifts, irregular shifts, and scheduling the bare minimum number of employees required to minimize employee downtime.
And I'd add that for me the biggest issue is the extent to which it treats workers as disposable. In a salaried position, everybody understands and behaves as if people are people. E.g., sick days.
As somebody who was a self-employed consultant for years, I get that being one's own boss has upsides. But I always maintained a large buffer of cash and could price in all the time I spent looking for work. Things like Uber and the new retail scheduling trend don't allow for that, and as far as I'm concerned amount to calculated exploitation of desperate people.
In some sense, that's nothing new in labor history; we've always had exploitation of desperate people. But that's no excuse for increasing it, and in particular I despise Uber's "we're just helping people be independent entrepreneurs" spin to cover up that exploitation, especially when their whole plan is to kick those supposed entrepreneurs out into the snow the moment they have self-driving cars.
Yes. But we as citizens get to decide how much we want to let our society be determined by raw capitalism. Freedom to starve in the gutter is one kind of freedom, but not the only one.
>Throughout all of this, they sing a song of "entrepreneurship" and "worker independence" while providing low-quality, low-stability jobs and making long-term plans to put every one of their drivers out of work.
So, of the people I know working for Uber... it seems that compared to other unskiled labor jobs open to them? By all accounts, Uber is worlds better than foodservice, unless you count both the lack of disability insurance (workers comp functions as a sort of disability insurance for most people) and massively increased danger (driving a car is one of the more dangerous jobs available) - but certainly for the right now? the people I know who work for uber? they are so happy to not have to work foodservice. And the schedule control? the schedule control is unheard of for unskilled labor jobs. If you don't know anyone who works retail, it's not like being an engineer, where so long as I show up between 8:00 and 11:30AM, the boss is cool. No, not only do they have to stick to a schedule, but that schedule changes from week to week and even day to day. Uber lets these people have, if not full schedule flexibility, at least more schedule flexibility than I get.
I... don't think I could handle an unskilled job for more than a month. I'd get fired for showing up late, or quit after one too many customers laid in to me because they were having a bad day.
So... yeah, even without the disability insurance, I think I'd choose an uber driving job over a fast food job. And if uber loses the appeal? (what happened with that, anyhow?) and is forced to pay on a W2 basis and cover worker's comp? That problem will be solved, too.
(oh yeah, as an aside, if I ran uber? I'd tell my lawyer to take a fall; to make damn sure we "lost" that case. Uber is far better placed to absorb the extra costs associated with paying drivers as employees than any of the other ride-sharing companies.)
>On top of all of that, I believe they're a great example of the shift back to a new gilded age, where the main function of the poor is to directly serve the wealthy. But instead of a Victorian model where employees are part of the household, in the Uber model we'll get paid only during the instants we are directly useful to somebody with money.
Now, I'm not defending uber on any of the other counts; or this one, really; you aren't wrong. Especially on the bit about wanting the convenience of having servants without wanting to deal with the relationship -
You could make the argument that the new arrangement is more respectful to the workers; when the uber driver is off shift, she is my social equal, and that wasn't true of the Victorian model. It's certainly a hell of a lot less paternalistic.
Of course, you certainly have a point that the new model is less stable. (I return again to the worker's comp issue)
But the truth of the matter is that it sucks to be poor. It always has, really, and it probably always will.
I'm just saying, when you compare working for Uber to the other choices an "unskilled" person has, it doesn't look so bad. Being poor sucks, sure. but I think being poor and driving for Uber is probably better than being poor and working at McDonalds or target or what have you. (minus, of course, that disability insurance thing, which, I guess, could actually be a pretty big deal, considering the increased chance of disability that comes from driving all day)
I think that if the disability insurance problem was solved (say, by Uber losing that court case) then if Uber or similar services increases the demand for professional drivers, that might be a win-win for both the poor, who get slightly better jobs, and the upper middle, who don't have to drive as much.
(I need a better word than "unskilled" - I highly doubt I could maintain a minimum uber driver rating. I'm a below-average driver, and while I could maintain that l...
Uber isn't really a job open to the poor. First, you need to be able to afford a decent car, which is right out for the for a lot of people. Second, if you're poor and living paycheck to paycheck, you're unlikely to have the cash to cover any major repairs.
Also, after you deduct vehicle depreciation, insurance, gas, and time driving without a fare, uber doesn't pay all that well per hour.
As far as actual driver statistics go, Uber isn't a good employment alternative for the poor, it's a stopgap measure for the unemployed middle class--more than half of drivers have a college degree and more than half work for less than a year.
> Uber isn't really a job open to the poor. First, you need to be able to afford a decent car, which is right out for the for a lot of people. Second, if you're poor and living paycheck to paycheck, you're unlikely to have the cash to cover any major repairs.
Which doesn't stop people from buying nice cars. Don't get me wrong, the whole recent model car thing is a barrier, you need credit; but have you seen how easy it is to get a car loan lately? It's like subprime mortgages back in the day.
And uber will even give you one of those 'merchant account advance loans' to buy the car where they take their payment out of your earnings; I imagine the income requirements on those are even lower than on a conventional car loan. (though, I imagine if your credit is terrible, you are screwed either way.)
Also, a 2005 model year car is... not a high bar.
Remember, in most parts of America, you need a reliable car for that job at Burger King, too. And once you factor in maintenance and gas, a 2000 model year really isn't all that much cheaper than a 2005
>Also, after you deduct vehicle depreciation, insurance, gas, and time driving without a fare, uber doesn't pay all that well per hour.
I'm comparing it to foodservice; and compared to burger king, from what I hear, it does pay pretty well. And the cost of operating the car (that you are gonna need for that burger king job, too) can (well, it's complicated) be paid for out of pre-FICA (well, pre-tax, but FICA is most of the tax that poor people pay) money, which is a nice benefit you don't get from burger king.
But Yes, I think we're in agreement that it's not very good compared to a middle-class job.
My point is just that it's pretty nice compared to a lower-class job.
>As far as actual driver statistics go, Uber isn't a good employment alternative for the poor, it's a stopgap measure for the unemployed middle class--more than half of drivers have a college degree and more than half work for less than a year.
40% of working-aged Americans, from what I read, have college degrees; I don't think that's an indicator of "not poor" anymore.
> Don't get me wrong, the whole recent model car thing is a barrier, you need credit; but have you seen how easy it is to get a car loan lately? It's like subprime mortgages back in the day.
You do realize that subprime mortgages turned out terribly for a lot of low-income people, right? Because when the economic circumstances changed, their debt was suddenly unaffordable, ruining credit and ruining lives? And that many of those sub-prime mortgages were basically designed from the start to take money from unsophisticated borrowers, saddling them up with debt they probably couldn't afford.
>Which doesn't stop people from buying nice cars. Don't get me wrong, the whole recent model car thing is a barrier, you need credit; but have you seen how easy it is to get a car loan lately?
I think we have a different definition of poor. I'm not talking about someone who make $40k a year and lives paycheck to paycheck because they spend above their means. I'm talking about people making $15k a year (or less) at near minimum wage job. The kind of people who work in fast food.
>Also, a 2005 model year car is... not a high bar
For a person working 30 hours a week at a fast food restaurant that's a very high bar. And you're forgetting that Uber inspects the car as well, so the clunky beaters that nearly everyone drove when I worked retail during college aren't going to pass inspection.
>Remember, in most parts of America, you need a reliable car for that job at Burger King, too.
Most people working at Burger King don't have reliable cars. If they live outside of a mass transit area, they rely on friends and family when they have breakdowns. If you've ever managed retail employees (I was a geek squad supervisor in college), you'll know just how frequently workers rely on other people to drop them off, or how often they call out because their car broke down.
> And once you factor in maintenance and gas, a 2000 model year really isn't all that much cheaper than a 2005
That's true. But this is a common problem that poor people face. They don't have the money up front, so they take the cheaper up front option even though it's more expensive over the long term.
>I'm comparing it to foodservice; and compared to burger king, from what I hear, it does pay pretty well.
Definitely, but for the average burger king worker buying a car to work for Uber isn't a realistic goal. They don't have the cash and they don't have the credit to get a loan.
My point is, that there is no point comparing Uber to burger king because there is a very small intersection between people who are forced to work at burger king and people who can afford to work for Uber.
>My point is just that it's pretty nice compared to a lower-class job.
Yes,but it has barriers to entry that keeps it from being an option for the working poor, so again there is no point in your comparison.
>40% of working-aged Americans, from what I read, have college degrees
If we're talking about the same statistic, the 40% number was pretty inflated because it considered 2 year and professional degrees.
Also only 2.1% of people with a bachelor's degree are classified as working poor (under the poverty level and working) while over 21% of people with no college degree are classified as working poor.
Since a college degree decreases your chance of being working poor by 10 times, I'd say it's a a good discriminator.
Sure, I get that some people are happy with the Uber work. But that doesn't make Uber good. Because Uber is just exploiting that population, shifting their capital costs and risks to people without a lot of options.
And these are all very temporary jobs. The only reason Uber has such a high valuation is that they plan to fuck those people over. "Kalanick has said that he can't wait for the moment when he can get rid of 'the other dude in the car,'" writes Vice [1]. They just spent a shit-ton of money on robot car research, destroying an AI lab in the process. [2]
Is driving really unskilled? Most people take a course to learn and you have to be tested and regularly licensed to legally operate a vehicle on public roads.
I think `unskilled' might be a technical term for how fast a member of the general population could pick up the job?
At some point, computer usage might have been sufficient for crossing the threshold from unskilled to skilled labour. Now we expect everyone to have a basic understanding. (And even earlier, literacy alone was a `skill'.)
Sometimes local laws are not worth complying. Taxi medallions are one example - they artificially limit supply and break the market. The argument that a limit on taxis is needed to prevent congestion ignores the whole concept of 'supply and demand'. Too many taxis? The market will correct itself, just like what's happening with Uber drivers (I know many are quitting due to the excess supply).
I understand that many people have substituted a faith in "the market" for a faith in god, so forgive me if I offend somebody's religious sensibilities here.
But it turns out there were historical reasons the supply of taxis was artificially limited. An argument like this, which conflates "good" with "whatever the market does" is a terrible argument because it is only sidestepping the point. If you want to say the supply restrictions are bad, then you either need to find a different solution that solves the problem or to make an argument that the harm done by supply restrictions is worse than any other possible solution, so we should just let the market ride.
Markets can sometimes magically self-correct. But market failure [1] is a thing, and even when it isn't, market optimum is not always a human optimum. And markets are not our masters, but tools we use to serve humans.
Also, taxis are only a small fraction of all traffic. Restricting the number of taxis will even worsen congestion (and definitely parking), if people are substituting with their own cars.
Can you demonstrate that? I've had taxi drivers say the exact opposite: in times when there are too many medallions available, they believe that cabs spend a lot more time either looking for fares or stopped waiting for fares. That's because the incentive for each individual cab driver is to keep driving during the slow times hoping to get lucky, and hoping to make things up during the peaks.
How is Uber in any way different in terms of "job security" and "getting paid only when they are useful" than taxis?
Taxi drivers were already mostly contractors, who had to pay to work (renting a medallion from one of the rich guys who owned them, renting the car, paying for gas) and then got paid per ride.
I dislike Uber as a company in general, but I don't get this idea that they represent some worsening of the work conditions, as if previous workers were employed with benefits.
The cab drivers I talk to (which is a fair number, since I still take cabs) by and large hate Uber and are quite happy to talk about it, so if you're really curious, drop $20 and ask.
That said, my take: Taxi drivers were mostly contractors, and they did have to rent the cab. But I think that's way better than having to buy the whole goddamn car and then hope that they make it back. Plus paying all of the maintenance and being out of work if a car broke. They also had to pay the medallion fee, but most of them liked that system, because a) it restricted the number of cabs such that they could make decent money if they worked hard, and b) they saw the medallion system as their version of retirement planning. Specifically, here in SF medallions could be bought only by working taxi drivers, and in order on a waiting list. So the ones that talked about it to me were pretty comfortable with the system.
So along those axes, I think Uber is actually worse, and I think that mainly because cabbies say so. I agree that the previous condition still wasn't great, though.
But I think that's way better than having to buy the whole goddamn car and then hope that they make it back. Plus paying all of the maintenance and being out of work if a car broke.
There are already multiple companies renting cars for driving for Uber/Lyft/etc.
Specifically, here in SF medallions could be bought only by working taxi drivers, and in order on a waiting list. So the ones that talked about it to me were pretty comfortable with the system.
Yeah, no shit, they got in. It's like measuring the average outcome of a lottery by only surveying the winners. What about everyone who didn't? How do you measure the loss inflicted on everyone who remained unemployed when could they have been working?
> There already multiple companies renting cars for driving for Uber/Lyft/etc.
And what percentage of the total fleet are those? What percentage of the markets are they in? My guess: vanishingly small. And it's also not clear whether those businesses would survive; there's a reason Uber dodged that end of the business.
> How do you measure the loss inflicted on everyone who remained unemployed when could they have been working?
So your notion here is that there are some number of people who were saying, "Gosh, I wish I could be a taxi driver" but are otherwise sitting around idle because of medallion restrictions limiting supply? What's your evidence that number is greater than zero?
As far as I know, taxi companies have pretty much always been hiring in SF. And that's despite the fact that the medallion system artificially boosts individual income through supply restrictions.
Also, given that taxi drivers are on the order of 1/1000th of the American labor force, I suspect the medallion system caused exactly zero unemployment, but instead, if it had any effect at all, created an infinitesimal decrease in the labor price.
> There already multiple companies renting cars for driving for Uber/Lyft/etc.
What percentage of the total fleet are those? What percentage of the markets are they in? My guess: vanishingly small. It's also not clear whether those businesses would survive; there's a reason Uber dodged that end of the business.
> How do you measure the loss inflicted on everyone who remained unemployed when could they have been working?
So your notion here is that there are some number of people who were saying, "Gosh, I wish I could be a taxi driver" but are otherwise sitting around idle because of medallion restrictions limiting job supply? What's your evidence that number is greater than zero?
As far as I know, taxi companies have pretty much always been hiring in SF. And that's despite the fact that the medallion system artificially boosts individual income through supply restrictions.
Given that taxi drivers are on the order of 1/1000th of the American labor force, I suspect the medallion system caused exactly zero unemployment, but instead created an infinitesimal decrease in the general-pool labor price through a tiny supply increase.
People that don't believe that a US company whose business model is based solely on breaking the law in other countries and compromising passenger safety aren't idiots.
And let's be clear in many countries taxi drivers are far more rigorously screened and of course have security cameras. Both of which Uber has been a bit lax at.
I disagree. They can't see the wood for the trees.
Über is inherently safe. The drivers are licenced. The cars are modern. And most importantly, the drivers have skin in the game. If you spend any time on the road at all it's frankly irrational to worry about driver safety.
Complaining about Uber, a company that operates entirely through mutual consent, being 'evil' is ridiculous, against the backdrop of a deeply corrupt industry.
This just shows that there is not much margin in this industry. They are essentially buying market share. However, as soon as Uber try to squeeze out some profit, they'll be undercut by the competitors.
Competitors lowering their pricing is not going to magically cause an exodus of customers who are attached to using Uber. Price change would be gradual, if done correctly, imperceptible. Plus, those competitors are being squeezed right now, who knows if they will be around once Uber decides to raise pricing to move towards profit. As they say on Wall Street, the market can stay irrational longer than you can stay solvent. No doubt this saying is apt for this present circumstance, especially since Wall Street is involved.
Uber is in the service industry, and winning in the service is not always on price.
Customer attachement is still a largely unproven hypothesis. How many people in San Francisco have both Lyft and Uber? The cost, as a consumer, to use indifferently one or the other is null.
The really hard challenge for Uber is: not becoming a commodity. I have no doubt they can crush incumbent taxi companies. How Uber will avoid being swallowed by the competitive beast they created is another, and harder, challenge.
Let's assume their strategy works and they win an effective monopoly. What's stopping a "new Uber" coming along, funded by a couple of billion in VC money, to attack Uber's monopoly position by offering the same service cheaper. If winning a market can be done by subsidising your offering with VC cash then someone else will come along and do it as soon as Uber push for higher prices.
While there's huge amounts of private equity money available Uber will never be able to raise prices, especially considering there are plenty of investors around who are unhappy about missing Uber's first few rounds.
Reality is the opposite. Uber is building a commanding, monopoly-like position whereby it can raise and lower prices as necessary. Not only does winning a market require way more than subsidies but Uber is also in the best position to subsidize.
It shows that they're fighting very hard to become the monopoly player because they know that the lock in from the network effects of the taxi market are worth way more than $500 million.
There is no network effect. As soon as you pay the drivers more, and charge the riders less, they will install your app. What keeps drivers and riders from checking both Uber and SuperDuperUber apps at the same time to make/save some extra money?
Networks that have a larger customer and driver base can link them up quicker.
That means that, at no extra cost to the network, the customer will end up waiting 2 minutes for a cab instead of 40, and the driver will end up waiting 2 minutes for a fare instead of 40.
Would you pay extra for those 38 minutes as a customer? I would. Would you accept a lower commission as a driver if you spend less time waiting for fares? I would.
As soon as the competitor tries to muscle in, the dominant player can maintain that advantage while dropping their costs and still remain profitable. They can undercut the new player until they go out of business.
Realistically speaking, the new players will recognize this built in advantage and will not challenge the monopoly at all unless their pockets are very, very, very deep and they are prepared for a protracted period of heavy losses.
Uber is still fighting to gain that monopoly advantage, but it looks like their investors are willing to sustain heavy losses for a long time to get there. Once they do have it, it will become self-sustaining. The more powerful their monopoly power is, the less likely it will be challenged, so the more powerful it will become. At that point they can start milking their customers and drivers and then earn some truly ridiculous profits.
Part of the monopoly advantage means that they can covertly punish drivers who choose to use competitors' apps by sending them fewer rides. If it's not already here, this tactic is probably coming very soon.
> Part of the monopoly advantage means that they can covertly punish drivers who choose to use competitors' apps by sending them fewer rides. If it's not already here, this tactic is probably coming very soon.
If they try this as a monopoly, the Department of Justice will probably start investigating.
That's because Uber is an infrastructure project that just happens to be VC-funded instead of taxpayer-funded. Uber is targeting the taxi industry and delivery services. Their competitors like Lyft have too small a vision. Lyft doesn't want to replace taxis with self-driving, they're focusing on making the standard taxi ride experience nicer than usual. Uber has a service for delivering food, their competitors are courier services who do food delivery, in-house delivery drivers, and apps that let you pre-pay for takeout. Uber's vision is bigger than just delivery of food, it's for delivery of damn near anything.
This is why Jeff Bezos invested in Uber; Amazon is looking at using drones for delivery but why do that when you have a stable of drivers (and self-driving cars in the future) that can do deliveries?
Basically; Uber's competitors are still focusing on their little niches and not willing to be the infrastructure for getting person/object A to place B.
There was a comment thread earlier today about whether Uber is solving rich-people problems or common-people problems. I wonder the extent to which Uber's pricing is sustainable -- are they subsidizing uberX and uberPOOL pricing out of money they're raising, or are the debts just in the pursuit of growth to new cities? Or put another way, if they ceased all growth, froze prices, and laid off all engineering and marketing staff except for one person to keep up with mobile OS updates (but kept the staff to recruit drivers, deal with legal issues, etc.), would the company be profitable, or would it go bankrupt?
I certainly don't complain when I get subsidized lunches delivered to me on VC money, but when existing Uber cities are debating regularizing Uber's legal status or just fixing the inefficiencies / problems with the taxi industry that Uber capitalized on, I want to know if Uber's going to be around for the people of that city, at the same effective prices, in 20 years.
Yup. Alternatively, if they ended the subsidies and raised prices to match costs, would it go back to being a rich people's service?
Don't get me wrong, taxis in many cities (especially SF) aren't serving the public reasonably. But Uber is only part of that conversation because it's price-competitive with taxis. If we thank them for identifying the problem, and then solve it by regularizing Uber's legal status, will the problem come back in three years once uberX and uberPOOL need to be profitable? Should we instead focus legislative effort on making taxis work?
They solved the "hail a taxi by pressing a button on your smartphone problem". It's not really subsidized, if they weren't setting piles of money on fire trying to grow really fast(and taking moonshots on autonomous cars), they would definitely be profitable.
Having used the apps that literally hail a taxi through a smartphone button, I feel compelled to note that Uber has solved a lot more than that. They've also solved the utterly miserable taxi experience that follows pressing the button.
A few years ago I would have agreed with that, but I recently switched to Flywheel in SF because I was tired of the Uber drivers wandering around downtown's one-way streets for half an hour every time I hailed one of them because they don't know the city. I'm not exactly thrilled about going back to taxis, but at least they don't act like it's their first day behind the wheel. (And with Flywheel they can no longer lie and tell me their credit card machine is "broken"...)
Drivers not knowing the area, getting lost, etc are not restricted to Uber/Lyft - I've had many taxi rides in the US where the driver has no idea how to get places - in SF/NYC/LA/BOS/DC -- so not even restricted to 1 city.
I used Flywheel exactly once. It led to a driver taking an incredible series of wrong turns, wasting a bunch of my time, and me spending nearly double what I needed to. All because the driver took a lot of wrong turns, didn't know the area at all, and didn't rely on technology.
In many cities uber is paying drivers a guaranteed $40 per hour to drive regardless of fares during peak times.
In many places uber is currently an unsustainable, heavily subsidised operation which would fail in free market conditions, but because of their big stash of VC $$ they are able to survive while eating away at taxi driver market share.
Yup, in NYC, Uber is paying a guaranteed $35K/6 months revenue to new drivers (provided they're online 200 hours per month and accept 90% of trips, but you know). I don't know how much of this they expect to pay out, but taxis work really well in this city (compared to, say, SF), so my guess is that they're competing aggressively. If they raised prices instead of subsidizing the shortfall to $35K, would the popular response to Uber be different?
It seem highly unlikely that they're planning on waiting 20+ years it will take before fully autonomous vehicles are able to reliably navigate busy city streets and are licensed to do so without a driver behind the wheel.
It'll be less than a decade, people are already talking about replacing trucks with self-driving trucks and there's been lots of research and experimentation with self-driving cars and synchronization. The pieces are slowly falling into place and the key things remaining are the laws need to accommodate autonomous vehicles and larger scale tests need to happen.
When the law catches up, insurance companies will have something in place.
When there's a large scale test, production/distribution have to ramp up.
Even if Uber can replace just 1% of their drivers with self-driving cars it would be worthwhile.
This is always my thought whenever I see a conversation like this come up about Uber. I understand they're all important issues, but why care so much about whether their drivers are employees or contractors when they're intending to lay them all off ASAP? They're just buying time and taking market share until self-driving cars arrive.
Don't remember the link, but Kalanick was recently quoted about how he'd buy a bunch of Tesla self-driving cars in 2020. Whether it will be Teslas or not, I believe it's clear that their whole strategy is to move to self-driving cars as immediately as feasible.
Because that employment aspect is important to those people now. Let Uber do it and what argument do you have against others doing the same? "Soon they'll be robots anyway."
I don't know why people think self-driving cards benefit Uber uniquely. Everyone else would get to use them too, after all, so Lyft's costs also go down.
It's like saying, "whoa, tomato prices have skyrocketed -- I bet grocery stores are making record profits!"
To be sure, there might be some differential advantage, but not enough to justify subsidizing everyone in the hopes they won't jump ship after competition comes in from other brands without these "legacy costs".
Well, to the argument I was trying to set up (whether cities should regularize Uber or fix taxis), one important change is that Uber now has the capital to make self-driving cars happen, and will continue to have the capital to make them continue to improve, and the taxi industry and transportation agencies don't. That is, I'm not drawing a huge distinction between Uber and Lyft, since both are questionably legal, but between Uber/Lyft/etc. and taxis. You could argue that letting Uber run self-driving cars is better than trying to have government-run self-driving cars.
Depends a lot on whether Uber themselves are making this happen, or we're looking to Tesla, Google, etc. If self-driving cars are going to happen anyway, then there's an argument from the other direction that permitting Uber has no long-term benefits.
Uber would have an entrenched brand worldwide and benefits of scale and purchasing power. Would you tackle McDonalds with an international effort to roll out burgers? You have access to the same teenage workers, same buns and potatoes and so on, right?
Ignoring other car services, the public would have the option to buy their own self-driving car, but we'll get to the point where the majority won't. You'll be choosing between:
Own car - larger cost, garaging, cleaning, insurance, power, depreciation, fixed format (sedan, van, truck), etc.
Their car - pay per use, or subscription to use as required, hire the type of vehicle you need when you need it.
It would be profitable, but assuming the situation your describe, it would primarily come down to (1) driver churn and (2) costs associated with any adverse legal rulings/judgments.
1. Cost of recruiting drivers is relatively high - probably around $50-$100 per driver. This cost is composed of background check (probably $10-20), the ad that got them in the door ($5-10 for that click), the overhead cost of recruiting staff and onboarding staff and 1099 paperwork ($2-$5). Let's be nice and say $50 is the cost. Again, being generous, if the average ride is $20, and Uber takes 20% ($4), that means that each driver needs to perform 13 rides for Uber to make their $$ back. I don't know for sure, but anecdotally most drivers I've ridden with likely exceeded this, so I'd say they are good on this front.
2. In reading the recent CA administrative decision, the main damages were for reimbursement for mileage, at $0.56 per mile. So this means that IF a state were to determine either that (a) drivers are employees or (b) drivers are not employees but some "third-option hybrid" for whom Uber still needs to reimburse miles, this would great eat into their margins and drag profitability down.
> Cost of recruiting drivers is relatively high - probably around $50-$100 per driver.
Hrm. Instead of working from first principles, we can poke at some data. Zen99 calculates that Uber seems to be spending some $1M/year on Craigslist ads for SF drivers alone [1], and as of the end of last year, they had about 16,000 drivers in SF [2]. Assuming generously that they recruited them all that year, that's about $62 on Craiglist advertising per driver, much higher than your $5-10 estimate.
There are also incentives like an unconditional $500 on your first ride [3]. In NYC, Uber also offers new drivers a free defensive driving class and doctor's examination at their offices [4], because they need those to get on the road. You will not find doctors to do exams for $2-5.
I would guess total driver acquisition cost, including first-trip incentives, is much more likely to be in the $1000-2000 range, at minimum. And we still haven't gotten to long-term subsidies like uberPOOL, which is what I'm really curious about. Even a $10K driver acquisition cost could maybe be sustainable if each driver lasts over a year on average, since it's a one-time cost. But it needs to pay better than taxi wages + cost of car maintenance for the driver, and at least break even for Uber, in the steady state.
you = right. I was thinking on a per unit basis, but if you think on a conversion basis your $1k-$2k makes a lot of sense, even if you start with my #s - if you assume $50-$100 per driver, and that Uber actually only converts 5% (which is generous), that means you get to the $1k-$2k.
My own impression taking Uber is that same trips would have cost me more than twice if I were to take a regular cab. The reported $470M operating loss on $410 revenue seems to be somewhat in same ballpark. I don't believe current pricing is sustainable. I don't see any cost advantage for Uber other than paying drivers less than the drivers-owners of regular cab service.
IMO, Uber may be hoping that once regular cab services are put out of business, Uber can raise the prices. The sustainable long term value prop seems to be ability to call up a cab using mobile app on your phone (request and dispatch portion of regular cab business). Everything else appears to contribute to loss.
I also don't believe time has come for self-driving cars or will be in next 5 years at least. If another technology bust happens before self-driving cars become popular, these projects will go on the shelf if not cancelled (like the pet projects of founders and executives in 2000 dot bomb).
Besides I don't see why taxi companies can't offer the same value (ordering taxi on a mobile phone app). Here in Moldova we already have that. You can order a taxi from several services at once with a mobile app, and the app is made by the company/companies (I'm not really sure it's only one, but they certainly do business together) behind these services.
I've been pondering how you'd break the uber lock on the market. I mean, I use Uber and not Lyft 'cause there are more Uber drivers, so on average, the car is gonna be there faster if I use Uber.
However, if I had an app on my phone to check the nearest uber and the nearest lyft and the nearest whatever else? that would remove the barrier to entry that Uber has set up. in that case (at least when lyft had a nearby car) I'd be happy to take lyft or the local cab company, if they had a similar app.
Of course, you'd end up with an arms race with uber, or whoever the dominant player was, with them trying to break your app.
Interestingly, I bet that the second and third tier ride-sharing companies would cooperate, so if there were enough of them in the area, the idea would work fine even when uber was winning the arms race.
You could break the Uber lock
on the market if supply and demand are not sufficiently random to require Uber's marketplace to coordinate.
That is, if it is usually convenient for Joe to depart from work at a certain hour and this is a time when Maureen typically likes to drive, both Joe and Maureen could potentially disintermediate Uber and split the marginal gain. This solution could look like a simple payments app, ride scheduler, and a local 'I'm here' function.
Another option could be to structure the market to enable 'teams' of drivers (ie like a taxi company brand). Allow these teams to find further operational gains through pooling resources and greater coordination. This solution would re-imagine the Uber market and driver tools for full-time workers.
Eh, I think the "one big marketplace" model is best. I... honestly, I don't want another relationship I have to worry about. I know it sounds terrible, but I just want to get to work every now and again, and I don't want to have to plan it ahead.
My point is that you don't have to run the cars to run a marketplace, though the money is being thrown at doing both at once in an effort to lock the running of the cars into the monopoly.
Running the marketplace is the only real natural monopoly here, though; If you can decouple the marketplace from the running of the cars, you could potentially become a lot more efficient, by allowing smaller players to run the cars.
Hm, I think 'one big marketplace' is how people originally thought about messaging online. I don't need WhatsApp, I have SMS. I don't need Snapchat I have WhatsApp. I don't need Facebook, I have Twitter.' However, horizontal differentiation in messaging and social has allowed people to use different tools depending on context. In fact, it's currently a bit silly to think you'd spam all your message or social apps at once using a single app or service.
I don't really feel there is a natural monopoly with today's tech when it comes to carsharing. This goes back to my first couple of points where ultimate coordination and reduction of friction may be better served by local/human players to some extent.
I... honestly I have no idea why there are players other than IRC and email, with sufficiently fancy clients.
Either it's primarily a marketing game, and the people willing to invest in marketing want their own network so that they have more control/can extract more value, or I just don't understand the market.
Did anyone actually believe that Uber was making a profit?
Honestly the question should be: Can you have a $50 billion valuation, while losing money? I'm not saying the the valuation should be zero, because they do have assets, but $50 billion is a lot of money.
At various times they've managed around a $100 to $200 billion valuation while losing money. They're an extreme outlier of course.
Salesforce.com hit near a $50 billion market cap recently, and they've never once printed a positive net income result.
If the sales growth and market dominance is there, the valuation will float a lot longer than seems reasonable given the lack of profits. This is especially true in tech, as it's believed that market dominance in tech inevitably leads to later outsized profit. It also helps if the losses are brought under some control, such that they aren't threatening the survival of the business.
If the bubble burst now, Uber will be the poster child of what's wrong with start ups.
I would probably be happy if they were to fail, for their past actions toward their competitor and their CEO's comments on the drivers were disgusting.
With the back lash with California's ruling and France, I think the laws are catching up to the new tech service and it doesn't look good currently for Uber. While people may argue that it's just California, California has a big population and a big market.
But a silver lining would be Telsa look like it were doom until Model S and they survived. I personally thought they were going to make it.
The concept of Uber (i.e., being able to reliably call a taxi from the phone) has a lot of value but there are significant competitive advantages of being the first to a customer's phone or by being the cheaper option to get adoption.
Hate to simplify it, but in many ways what we saw with Uber was similar to GroupOn. Uber will likely collapse, let's hope it does not take the tech market down with it. Although, I'm all for bubbles bursting and markets normalizing.
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[ 4.0 ms ] story [ 211 ms ] threadAn average Uber driver in Bangalore earns 110000 INR per month where as an entry level software engineer in GOOG/AMZN in India earns 80000 INR/month.
I was shocked that one of my friends who drove Uber in Bangalore told me that he made 180000 INR two months back.
It would be interesting to know Uber's customer acquistion cost and driver acquisition cost.
> Does anyone know what market flaws they're solving in India and Asia?
Well the only market flaw they appear to be solving here is that they aren't hoarding more of the money in the market...
Some of the local competitors have some of that (e.g. Zoomy), but they charge extra fees for paying though the app which makes them expensive, and also means you need to go through more of a process when the ride is finished.
The service is plainly better. The cars are better, the drivers are rated, payment is easier, hailing is easier, knowing where your cab is and how long it will be and how much is will cost before you start your ride ... is better.
I live in the Twin Cities ... not a place where cabs are dense enough to just hail one walking down the street (unless it's in a prime drinking/sporting hour & location).
Uber, Lyft, and the city of Minneapolis worked together to make uber-like services legal while giving concessions to the local traditional taxi drivers without compromising appropriate regulations. Everyone behaved reasonably which is sadly extremely rare everywhere else.
The running theory is that unreasonable people either leave Minnesota or are found only after the snow thaws (please don't take this too seriously :) )
'flaunting' was a carefully chosen word.
1. Time/Convenience: India does not have a system like America where you can hail cabs, they are only booked via an agency. These bookings need to be made some hours in advance. A pre-Uber thing (which I'm sure is still common in non-metropolotian parts of india) was to book an appropriately sized cab a day before we have a flight or train to catch. With Uber, request an Uber XL and you're done.
2. Price: As expected, these agencies work out to be pretty expensive. Uber is almost 50% cheaper.
I personally use Uber when I'm with people or have luggage with me. Otherwise India does have a very good metro train and also has autorickshaws (aka tuk tuk) but the former is not point to point and the latter seats 3 people at best (and an Uber sometimes works out to be cheaper than a autorickshaw)
I think that currently only a small part of India uses Uber significantly, but those who do have nothing but praise (anecdotal). Uber has better quality and better drivers for a better price. That said, the market seems large enough to warrant competitors like Ola and Meru.
* I'm yet to have an Uber driver clearly on methamphetamine, but a notable number of taximeter drivers
* No quibbling over the price or trying to overcharge from Uber
* Uber cars always have seatbelts, it's rare to find them in the back seat of taximeters
* Even if the Uber driver doesn't know the place you're going to, they've got a map, and directions, and they'll use them
* No worrying about if you've got sufficient loose change; you can be sure the taximeter driver will have a real shortage currently if you have only big notes
And on and on and on...
Uber is a breath of fresh air here. It doesn't force a destination, you can instantly know whether cars are available or not, generally arrives in 10 minutes or so, and there is no cash payment needed.
Where price is concerned, they've now managed to figure out the right pricing, so that an Uber ride costs only marginally more than a regular cab ride. e.g. Home to work takes around Rs 200 for a regular cab. Uber costs anywhere from Rs 220 (Uber X), to 350 (Uber Black).
At my school the general feel is that Uber is pretty evil, notably for its attitudes towards its drivers as well as towards Lyft.
Note on Uber: I think Uber is a great business and has a significantly net-positive impact on society, and I reserve judgment w/r/t whether TK and the other Uber execs are good or bad people - I can't conclude they are good because they run a good business, and I can't conclude they are bad because they say stupid things in public.
Note on Nietzche: In Thus Spake Zarathrusa, the "uberman" concept is (maybe) considered a positive that humanity should work towards in the absence of belief in God, and I think it can still be understood as such. The fact that history has attributed some very negative actions to the belief in this concept (Hitler, Leopold & Loeb's murder, etc.) is, in my opinion, not definitive but at the same time not entirely insignificant, but I'm also a Christian that believes in capital-M Morality so I'm biased against nihilism in general.
here's a thought I had a few months ago: how have there not been more thought pieces relating Uber-the-business's recent/relentless PR-debacles to Nietzsche's Ubermensch concept? I guess I'll give it a go.
Uber/Travis and his execs seem to demonstrate the belief that they are "overmen" in that they seem to believe that they transcend the rules of society and are destined to shape society and its values rather than the other way around (probably something not too uncommonly shared with HN readers…).
A few fun/funny/serious examples (in no particular order): 1. They outrightly express resistance to laws-as-is, and regularly threaten to ignore and sometimes do break those regs as necessary to conduct their business / benefit themselves and their consumers.
2. They hire lobbyists and other high-level political actors to change the laws they don't like and/or influence lawmakers - not atypical for a large company, but they did this earlier than most companies at their stage, with much more specific agendas in place and with a lot more PR surrounding it (the last may or may not have been their doing, hard to say). They have a belief (probably well-founded) that they can use the political process to make the law bend to their will. “Creating New Values” as any good uberman should.
3. They call their central system “Godmode” which implies that they, the viewers, are like God (a bit of a stretch I know…couldn’t resist)
4. They are proud that using the data in Godmode they can track, predict and identify specifics of other human being’s behavior.
5. The whole “we’ll pay our own researchers to smear journalists” thing - another good example of Creating New Values and constructing narratives.
6. The general feeling that Uber (perhaps correctly) operates against “states” and “sovereigns” and “systems” more than corporate competitors (who even writes about Lyft anymore these days…)
The funny thing is that after thinking this through, all (good?) CEOs of major corporations basically operate like this (and so do many other tech-leaders - it is often associated with libertarian-leaning individuals like P. Thiel, etc.) - the difference is that Uber (1) has a name that calls it out and (2) seems to be especially prone to doing this in public and (3) sometimes appears to relishes their “overlord-iness” a little too much. You can call it being crass or being honest. In any case, they seem to be getting hip to the system and playing nice which of course can be viewed as just another level of the game, etc. - still, glad to see them do it because I overall think that playing nice is best (especially when you can afford to do it) and with a $50b val. and a couple billion raised, I think they can spare some good behavior, at least for now =)
The way Uber treats its employees? Pretty evil.
The way Uber competes against existing taxi services? Not evil at all in my opinion.
I'm using duck typing here.
If you were a taxi driver you wouldn't be happy that you are abiding by the law and a US company comes waltzing in, flouts your countries's laws actively trying to ruin your lifelihood.
Riiiiiiight.
And just because the cab regulations overshot in many places it does not mean no regulations is the answer. Also, while civil disobedience is laudable the same can't be said from a company. Problem is, what if next time a company finds another set of regulations / laws it doesn't like? This sort of behavior should be killed with fire because it weakens the very rule of law. I know this is not a popular opinion but the French arresting the leaders of Uber in France are going the right direction and more of the same is (badly) needed.
With that in mind, what do you think the right approach is?
For me it's more the accumulation of awfulness. They started out as a scheme to time-share limos among young entitled dudebros. They entered the market with the black cars, exploiting a status-good dynamic. They've shifted all of the capital cost and risk of the taxi business to drivers, surely screwing many of them in the process. Their "we're too important to comply with mere laws" routine strikes me as arrogant horseshit. They've had assorted scandals, including inviting a bunch of journalists to an off-the-record dinner and then "joking" about plans to spend lots of money to destroy the career of a prominent journalist they didn't like. I've lost count of how many places have arrested or issued arrest warrants for their people.
Throughout all of this, they sing a song of "entrepreneurship" and "worker independence" while providing low-quality, low-stability jobs and making long-term plans to put every one of their drivers out of work. They couldn't give a shit about their workers, and are even willing to threaten their jobs (which aren't jobs, of course, but independent contractor positions) if they are politically active.
On top of all of that, I believe they're a great example of the shift back to a new gilded age, where the main function of the poor is to directly serve the wealthy. But instead of a Victorian model where employees are part of the household, in the Uber model we'll get paid only during the instants we are directly useful to somebody with money.
That's just some highlights off the top of my head; the list goes on. They may not be the very worst, but they have an awful lot of people rooting for their fall. I expect they won't go totally bust. But I am looking forward to a Groupon-style outcome once their investor-fueled growth becomes untenable.
I'm sorry, but that sounds more like the efficiency that capitalism optimizes towards.
The CEO doesn't stop being paid when she walks to the bathroom, and a cashier doesn't stop being paid when he's waiting for a customer to show up. wpietri is talking about a shift in the granularity of trading your labor for money, so that you aren't paid for a day or an hour of work, but for the exact number of minutes you performed useful work.
The shift is away from paying an employee for 8 hours of work--knowing that he will only be performing useful work for some fraction of that time--towards paying the same employee only for the time spent being productive.
Since most people aren't able to work productively for an entire 8 hour shift, this change probably means a net decrease in wages.
We've already started to see this with computer scheduling in retail. Assigning split shifts, irregular shifts, and scheduling the bare minimum number of employees required to minimize employee downtime.
As somebody who was a self-employed consultant for years, I get that being one's own boss has upsides. But I always maintained a large buffer of cash and could price in all the time I spent looking for work. Things like Uber and the new retail scheduling trend don't allow for that, and as far as I'm concerned amount to calculated exploitation of desperate people.
In some sense, that's nothing new in labor history; we've always had exploitation of desperate people. But that's no excuse for increasing it, and in particular I despise Uber's "we're just helping people be independent entrepreneurs" spin to cover up that exploitation, especially when their whole plan is to kick those supposed entrepreneurs out into the snow the moment they have self-driving cars.
So, of the people I know working for Uber... it seems that compared to other unskiled labor jobs open to them? By all accounts, Uber is worlds better than foodservice, unless you count both the lack of disability insurance (workers comp functions as a sort of disability insurance for most people) and massively increased danger (driving a car is one of the more dangerous jobs available) - but certainly for the right now? the people I know who work for uber? they are so happy to not have to work foodservice. And the schedule control? the schedule control is unheard of for unskilled labor jobs. If you don't know anyone who works retail, it's not like being an engineer, where so long as I show up between 8:00 and 11:30AM, the boss is cool. No, not only do they have to stick to a schedule, but that schedule changes from week to week and even day to day. Uber lets these people have, if not full schedule flexibility, at least more schedule flexibility than I get.
I... don't think I could handle an unskilled job for more than a month. I'd get fired for showing up late, or quit after one too many customers laid in to me because they were having a bad day.
So... yeah, even without the disability insurance, I think I'd choose an uber driving job over a fast food job. And if uber loses the appeal? (what happened with that, anyhow?) and is forced to pay on a W2 basis and cover worker's comp? That problem will be solved, too.
(oh yeah, as an aside, if I ran uber? I'd tell my lawyer to take a fall; to make damn sure we "lost" that case. Uber is far better placed to absorb the extra costs associated with paying drivers as employees than any of the other ride-sharing companies.)
>On top of all of that, I believe they're a great example of the shift back to a new gilded age, where the main function of the poor is to directly serve the wealthy. But instead of a Victorian model where employees are part of the household, in the Uber model we'll get paid only during the instants we are directly useful to somebody with money.
Now, I'm not defending uber on any of the other counts; or this one, really; you aren't wrong. Especially on the bit about wanting the convenience of having servants without wanting to deal with the relationship -
You could make the argument that the new arrangement is more respectful to the workers; when the uber driver is off shift, she is my social equal, and that wasn't true of the Victorian model. It's certainly a hell of a lot less paternalistic.
Of course, you certainly have a point that the new model is less stable. (I return again to the worker's comp issue)
But the truth of the matter is that it sucks to be poor. It always has, really, and it probably always will.
I'm just saying, when you compare working for Uber to the other choices an "unskilled" person has, it doesn't look so bad. Being poor sucks, sure. but I think being poor and driving for Uber is probably better than being poor and working at McDonalds or target or what have you. (minus, of course, that disability insurance thing, which, I guess, could actually be a pretty big deal, considering the increased chance of disability that comes from driving all day)
I think that if the disability insurance problem was solved (say, by Uber losing that court case) then if Uber or similar services increases the demand for professional drivers, that might be a win-win for both the poor, who get slightly better jobs, and the upper middle, who don't have to drive as much.
(I need a better word than "unskilled" - I highly doubt I could maintain a minimum uber driver rating. I'm a below-average driver, and while I could maintain that l...
Also, after you deduct vehicle depreciation, insurance, gas, and time driving without a fare, uber doesn't pay all that well per hour.
As far as actual driver statistics go, Uber isn't a good employment alternative for the poor, it's a stopgap measure for the unemployed middle class--more than half of drivers have a college degree and more than half work for less than a year.
Which doesn't stop people from buying nice cars. Don't get me wrong, the whole recent model car thing is a barrier, you need credit; but have you seen how easy it is to get a car loan lately? It's like subprime mortgages back in the day.
And uber will even give you one of those 'merchant account advance loans' to buy the car where they take their payment out of your earnings; I imagine the income requirements on those are even lower than on a conventional car loan. (though, I imagine if your credit is terrible, you are screwed either way.)
Also, a 2005 model year car is... not a high bar.
Remember, in most parts of America, you need a reliable car for that job at Burger King, too. And once you factor in maintenance and gas, a 2000 model year really isn't all that much cheaper than a 2005
>Also, after you deduct vehicle depreciation, insurance, gas, and time driving without a fare, uber doesn't pay all that well per hour.
I'm comparing it to foodservice; and compared to burger king, from what I hear, it does pay pretty well. And the cost of operating the car (that you are gonna need for that burger king job, too) can (well, it's complicated) be paid for out of pre-FICA (well, pre-tax, but FICA is most of the tax that poor people pay) money, which is a nice benefit you don't get from burger king.
But Yes, I think we're in agreement that it's not very good compared to a middle-class job.
My point is just that it's pretty nice compared to a lower-class job.
>As far as actual driver statistics go, Uber isn't a good employment alternative for the poor, it's a stopgap measure for the unemployed middle class--more than half of drivers have a college degree and more than half work for less than a year.
40% of working-aged Americans, from what I read, have college degrees; I don't think that's an indicator of "not poor" anymore.
You do realize that subprime mortgages turned out terribly for a lot of low-income people, right? Because when the economic circumstances changed, their debt was suddenly unaffordable, ruining credit and ruining lives? And that many of those sub-prime mortgages were basically designed from the start to take money from unsophisticated borrowers, saddling them up with debt they probably couldn't afford.
I think we have a different definition of poor. I'm not talking about someone who make $40k a year and lives paycheck to paycheck because they spend above their means. I'm talking about people making $15k a year (or less) at near minimum wage job. The kind of people who work in fast food.
>Also, a 2005 model year car is... not a high bar
For a person working 30 hours a week at a fast food restaurant that's a very high bar. And you're forgetting that Uber inspects the car as well, so the clunky beaters that nearly everyone drove when I worked retail during college aren't going to pass inspection.
>Remember, in most parts of America, you need a reliable car for that job at Burger King, too.
Most people working at Burger King don't have reliable cars. If they live outside of a mass transit area, they rely on friends and family when they have breakdowns. If you've ever managed retail employees (I was a geek squad supervisor in college), you'll know just how frequently workers rely on other people to drop them off, or how often they call out because their car broke down.
> And once you factor in maintenance and gas, a 2000 model year really isn't all that much cheaper than a 2005
That's true. But this is a common problem that poor people face. They don't have the money up front, so they take the cheaper up front option even though it's more expensive over the long term.
>I'm comparing it to foodservice; and compared to burger king, from what I hear, it does pay pretty well.
Definitely, but for the average burger king worker buying a car to work for Uber isn't a realistic goal. They don't have the cash and they don't have the credit to get a loan.
My point is, that there is no point comparing Uber to burger king because there is a very small intersection between people who are forced to work at burger king and people who can afford to work for Uber.
>My point is just that it's pretty nice compared to a lower-class job.
Yes,but it has barriers to entry that keeps it from being an option for the working poor, so again there is no point in your comparison.
>40% of working-aged Americans, from what I read, have college degrees
If we're talking about the same statistic, the 40% number was pretty inflated because it considered 2 year and professional degrees.
Also only 2.1% of people with a bachelor's degree are classified as working poor (under the poverty level and working) while over 21% of people with no college degree are classified as working poor.
Since a college degree decreases your chance of being working poor by 10 times, I'd say it's a a good discriminator.
And these are all very temporary jobs. The only reason Uber has such a high valuation is that they plan to fuck those people over. "Kalanick has said that he can't wait for the moment when he can get rid of 'the other dude in the car,'" writes Vice [1]. They just spent a shit-ton of money on robot car research, destroying an AI lab in the process. [2]
[1] http://www.vice.com/read/all-the-reasons-why-uber-is-the-wor... [2] http://www.theverge.com/transportation/2015/5/19/8622831/ube...
At some point, computer usage might have been sufficient for crossing the threshold from unskilled to skilled labour. Now we expect everyone to have a basic understanding. (And even earlier, literacy alone was a `skill'.)
But it turns out there were historical reasons the supply of taxis was artificially limited. An argument like this, which conflates "good" with "whatever the market does" is a terrible argument because it is only sidestepping the point. If you want to say the supply restrictions are bad, then you either need to find a different solution that solves the problem or to make an argument that the harm done by supply restrictions is worse than any other possible solution, so we should just let the market ride.
Markets can sometimes magically self-correct. But market failure [1] is a thing, and even when it isn't, market optimum is not always a human optimum. And markets are not our masters, but tools we use to serve humans.
[1] https://en.wikipedia.org/wiki/Market_failure
Or just point out that the problem that was ostensibly solved wasn't.
Taxi drivers were already mostly contractors, who had to pay to work (renting a medallion from one of the rich guys who owned them, renting the car, paying for gas) and then got paid per ride.
I dislike Uber as a company in general, but I don't get this idea that they represent some worsening of the work conditions, as if previous workers were employed with benefits.
That said, my take: Taxi drivers were mostly contractors, and they did have to rent the cab. But I think that's way better than having to buy the whole goddamn car and then hope that they make it back. Plus paying all of the maintenance and being out of work if a car broke. They also had to pay the medallion fee, but most of them liked that system, because a) it restricted the number of cabs such that they could make decent money if they worked hard, and b) they saw the medallion system as their version of retirement planning. Specifically, here in SF medallions could be bought only by working taxi drivers, and in order on a waiting list. So the ones that talked about it to me were pretty comfortable with the system.
So along those axes, I think Uber is actually worse, and I think that mainly because cabbies say so. I agree that the previous condition still wasn't great, though.
There are already multiple companies renting cars for driving for Uber/Lyft/etc.
Specifically, here in SF medallions could be bought only by working taxi drivers, and in order on a waiting list. So the ones that talked about it to me were pretty comfortable with the system.
Yeah, no shit, they got in. It's like measuring the average outcome of a lottery by only surveying the winners. What about everyone who didn't? How do you measure the loss inflicted on everyone who remained unemployed when could they have been working?
And what percentage of the total fleet are those? What percentage of the markets are they in? My guess: vanishingly small. And it's also not clear whether those businesses would survive; there's a reason Uber dodged that end of the business.
> How do you measure the loss inflicted on everyone who remained unemployed when could they have been working?
So your notion here is that there are some number of people who were saying, "Gosh, I wish I could be a taxi driver" but are otherwise sitting around idle because of medallion restrictions limiting supply? What's your evidence that number is greater than zero?
As far as I know, taxi companies have pretty much always been hiring in SF. And that's despite the fact that the medallion system artificially boosts individual income through supply restrictions.
Also, given that taxi drivers are on the order of 1/1000th of the American labor force, I suspect the medallion system caused exactly zero unemployment, but instead, if it had any effect at all, created an infinitesimal decrease in the labor price.
What percentage of the total fleet are those? What percentage of the markets are they in? My guess: vanishingly small. It's also not clear whether those businesses would survive; there's a reason Uber dodged that end of the business.
> How do you measure the loss inflicted on everyone who remained unemployed when could they have been working?
So your notion here is that there are some number of people who were saying, "Gosh, I wish I could be a taxi driver" but are otherwise sitting around idle because of medallion restrictions limiting job supply? What's your evidence that number is greater than zero?
As far as I know, taxi companies have pretty much always been hiring in SF. And that's despite the fact that the medallion system artificially boosts individual income through supply restrictions.
Given that taxi drivers are on the order of 1/1000th of the American labor force, I suspect the medallion system caused exactly zero unemployment, but instead created an infinitesimal decrease in the general-pool labor price through a tiny supply increase.
The only evil here is whatever it was that made it take so long for this change to come about.
And let's be clear in many countries taxi drivers are far more rigorously screened and of course have security cameras. Both of which Uber has been a bit lax at.
Über is inherently safe. The drivers are licenced. The cars are modern. And most importantly, the drivers have skin in the game. If you spend any time on the road at all it's frankly irrational to worry about driver safety.
Complaining about Uber, a company that operates entirely through mutual consent, being 'evil' is ridiculous, against the backdrop of a deeply corrupt industry.
Uber is in the service industry, and winning in the service is not always on price.
The really hard challenge for Uber is: not becoming a commodity. I have no doubt they can crush incumbent taxi companies. How Uber will avoid being swallowed by the competitive beast they created is another, and harder, challenge.
While there's huge amounts of private equity money available Uber will never be able to raise prices, especially considering there are plenty of investors around who are unhappy about missing Uber's first few rounds.
That means that, at no extra cost to the network, the customer will end up waiting 2 minutes for a cab instead of 40, and the driver will end up waiting 2 minutes for a fare instead of 40.
Would you pay extra for those 38 minutes as a customer? I would. Would you accept a lower commission as a driver if you spend less time waiting for fares? I would.
As soon as the competitor tries to muscle in, the dominant player can maintain that advantage while dropping their costs and still remain profitable. They can undercut the new player until they go out of business.
Realistically speaking, the new players will recognize this built in advantage and will not challenge the monopoly at all unless their pockets are very, very, very deep and they are prepared for a protracted period of heavy losses.
Uber is still fighting to gain that monopoly advantage, but it looks like their investors are willing to sustain heavy losses for a long time to get there. Once they do have it, it will become self-sustaining. The more powerful their monopoly power is, the less likely it will be challenged, so the more powerful it will become. At that point they can start milking their customers and drivers and then earn some truly ridiculous profits.
Part of the monopoly advantage means that they can covertly punish drivers who choose to use competitors' apps by sending them fewer rides. If it's not already here, this tactic is probably coming very soon.
If they try this as a monopoly, the Department of Justice will probably start investigating.
This is why Jeff Bezos invested in Uber; Amazon is looking at using drones for delivery but why do that when you have a stable of drivers (and self-driving cars in the future) that can do deliveries?
Basically; Uber's competitors are still focusing on their little niches and not willing to be the infrastructure for getting person/object A to place B.
That's gross margin.
And if the $417m is from Q4 2014 (or even Q1 2015), 200% growth this year would surpass $3b (i.e., 30% of $10b).
I certainly don't complain when I get subsidized lunches delivered to me on VC money, but when existing Uber cities are debating regularizing Uber's legal status or just fixing the inefficiencies / problems with the taxi industry that Uber capitalized on, I want to know if Uber's going to be around for the people of that city, at the same effective prices, in 20 years.
But it is subsidizing a lot of rides right now, for example "Pool" rides where riders get the discount even if they are the only passenger.
Don't get me wrong, taxis in many cities (especially SF) aren't serving the public reasonably. But Uber is only part of that conversation because it's price-competitive with taxis. If we thank them for identifying the problem, and then solve it by regularizing Uber's legal status, will the problem come back in three years once uberX and uberPOOL need to be profitable? Should we instead focus legislative effort on making taxis work?
In SF.
In many places uber is currently an unsustainable, heavily subsidised operation which would fail in free market conditions, but because of their big stash of VC $$ they are able to survive while eating away at taxi driver market share.
When the law catches up, insurance companies will have something in place.
When there's a large scale test, production/distribution have to ramp up.
Even if Uber can replace just 1% of their drivers with self-driving cars it would be worthwhile.
Don't remember the link, but Kalanick was recently quoted about how he'd buy a bunch of Tesla self-driving cars in 2020. Whether it will be Teslas or not, I believe it's clear that their whole strategy is to move to self-driving cars as immediately as feasible.
It's like saying, "whoa, tomato prices have skyrocketed -- I bet grocery stores are making record profits!"
To be sure, there might be some differential advantage, but not enough to justify subsidizing everyone in the hopes they won't jump ship after competition comes in from other brands without these "legacy costs".
Depends a lot on whether Uber themselves are making this happen, or we're looking to Tesla, Google, etc. If self-driving cars are going to happen anyway, then there's an argument from the other direction that permitting Uber has no long-term benefits.
Ignoring other car services, the public would have the option to buy their own self-driving car, but we'll get to the point where the majority won't. You'll be choosing between:
Own car - larger cost, garaging, cleaning, insurance, power, depreciation, fixed format (sedan, van, truck), etc.
Their car - pay per use, or subscription to use as required, hire the type of vehicle you need when you need it.
1. Cost of recruiting drivers is relatively high - probably around $50-$100 per driver. This cost is composed of background check (probably $10-20), the ad that got them in the door ($5-10 for that click), the overhead cost of recruiting staff and onboarding staff and 1099 paperwork ($2-$5). Let's be nice and say $50 is the cost. Again, being generous, if the average ride is $20, and Uber takes 20% ($4), that means that each driver needs to perform 13 rides for Uber to make their $$ back. I don't know for sure, but anecdotally most drivers I've ridden with likely exceeded this, so I'd say they are good on this front.
2. In reading the recent CA administrative decision, the main damages were for reimbursement for mileage, at $0.56 per mile. So this means that IF a state were to determine either that (a) drivers are employees or (b) drivers are not employees but some "third-option hybrid" for whom Uber still needs to reimburse miles, this would great eat into their margins and drag profitability down.
Hrm. Instead of working from first principles, we can poke at some data. Zen99 calculates that Uber seems to be spending some $1M/year on Craigslist ads for SF drivers alone [1], and as of the end of last year, they had about 16,000 drivers in SF [2]. Assuming generously that they recruited them all that year, that's about $62 on Craiglist advertising per driver, much higher than your $5-10 estimate.
There are also incentives like an unconditional $500 on your first ride [3]. In NYC, Uber also offers new drivers a free defensive driving class and doctor's examination at their offices [4], because they need those to get on the road. You will not find doctors to do exams for $2-5.
I would guess total driver acquisition cost, including first-trip incentives, is much more likely to be in the $1000-2000 range, at minimum. And we still haven't gotten to long-term subsidies like uberPOOL, which is what I'm really curious about. Even a $10K driver acquisition cost could maybe be sustainable if each driver lasts over a year on average, since it's a one-time cost. But it needs to pay better than taxi wages + cost of car maintenance for the driver, and at least break even for Uber, in the steady state.
[1] https://tryzen99.com/blog_posts/on-demand-is-in-demand
[2] http://www.washingtonpost.com/blogs/wonkblog/wp/2015/01/22/n...
[3] http://www.driveubernyc.com/try
[4] http://www.driveubernyc.com/defensive
IMO, Uber may be hoping that once regular cab services are put out of business, Uber can raise the prices. The sustainable long term value prop seems to be ability to call up a cab using mobile app on your phone (request and dispatch portion of regular cab business). Everything else appears to contribute to loss.
I also don't believe time has come for self-driving cars or will be in next 5 years at least. If another technology bust happens before self-driving cars become popular, these projects will go on the shelf if not cancelled (like the pet projects of founders and executives in 2000 dot bomb).
However, if I had an app on my phone to check the nearest uber and the nearest lyft and the nearest whatever else? that would remove the barrier to entry that Uber has set up. in that case (at least when lyft had a nearby car) I'd be happy to take lyft or the local cab company, if they had a similar app.
Of course, you'd end up with an arms race with uber, or whoever the dominant player was, with them trying to break your app.
Interestingly, I bet that the second and third tier ride-sharing companies would cooperate, so if there were enough of them in the area, the idea would work fine even when uber was winning the arms race.
That is, if it is usually convenient for Joe to depart from work at a certain hour and this is a time when Maureen typically likes to drive, both Joe and Maureen could potentially disintermediate Uber and split the marginal gain. This solution could look like a simple payments app, ride scheduler, and a local 'I'm here' function.
Another option could be to structure the market to enable 'teams' of drivers (ie like a taxi company brand). Allow these teams to find further operational gains through pooling resources and greater coordination. This solution would re-imagine the Uber market and driver tools for full-time workers.
My point is that you don't have to run the cars to run a marketplace, though the money is being thrown at doing both at once in an effort to lock the running of the cars into the monopoly.
Running the marketplace is the only real natural monopoly here, though; If you can decouple the marketplace from the running of the cars, you could potentially become a lot more efficient, by allowing smaller players to run the cars.
I don't really feel there is a natural monopoly with today's tech when it comes to carsharing. This goes back to my first couple of points where ultimate coordination and reduction of friction may be better served by local/human players to some extent.
Either it's primarily a marketing game, and the people willing to invest in marketing want their own network so that they have more control/can extract more value, or I just don't understand the market.
Honestly the question should be: Can you have a $50 billion valuation, while losing money? I'm not saying the the valuation should be zero, because they do have assets, but $50 billion is a lot of money.
At various times they've managed around a $100 to $200 billion valuation while losing money. They're an extreme outlier of course.
Salesforce.com hit near a $50 billion market cap recently, and they've never once printed a positive net income result.
If the sales growth and market dominance is there, the valuation will float a lot longer than seems reasonable given the lack of profits. This is especially true in tech, as it's believed that market dominance in tech inevitably leads to later outsized profit. It also helps if the losses are brought under some control, such that they aren't threatening the survival of the business.
I would probably be happy if they were to fail, for their past actions toward their competitor and their CEO's comments on the drivers were disgusting.
With the back lash with California's ruling and France, I think the laws are catching up to the new tech service and it doesn't look good currently for Uber. While people may argue that it's just California, California has a big population and a big market.
But a silver lining would be Telsa look like it were doom until Model S and they survived. I personally thought they were going to make it.
Hate to simplify it, but in many ways what we saw with Uber was similar to GroupOn. Uber will likely collapse, let's hope it does not take the tech market down with it. Although, I'm all for bubbles bursting and markets normalizing.