
Uber's China Rival Close to Raising $2B in New Funding - davidiach
http://www.bloomberg.com/news/articles/2016-05-06/uber-china-rival-said-close-to-raising-2-billion-in-new-funding
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tluyben2
I have used Didi quite a bit, it's somewhat easier to arrange custom deals
with the drivers, like all-day-driver, etc. But the Uber experience was a lot
smoother for simple rides from A->B, at least for foreigners. This is in
Shanghai/Beijing and surrounding cities.

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epynonymous
couple of notes, uber is backed obviously by google, but also by baidu which
has deep governmental ties in china (sorry no reference, but the fact that
it's the number 1 search engine in china all these years should tell you
enough). uber, in fact, uses baidu maps in china for gps.

didi is backed by tencent which is the whatsapp clone maker (wechat) and i
think alibaba.

essentially it's very easy for the chinese government to block out foreign web
apps/services, just create a rule on the great firewall followed by regulation
to enforce large fines. but they havent done it yet, why? because imho uber
and didi help to solve one of the government's biggest urban problems,
efficient transportation. yes, sometimes they have small scale crackdowns at
airports and train stations to catch uber drivers, but that's just for show to
calm down the taxi companies which are government backed and didi, taxi
companies have been known to go on strike causing the government to have to
resolve things.

it used to also be that uber was only paying taxes in usa, but now they're
also lawfully paying taxes which should be another revenue stream for the
government which is needed in this current economy.

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yueq
I have used DiDi quite often when I was in Shanghai last year. It was a very
pleasant experience comparing using Uber in China.

I'm very confident Didi will have a much larger impact than Uber, at least in
Chinese market.

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fossuser
I'd heard that the Chinese government unfairly favors local companies. Is this
no longer the case?

Seems like it'd be difficult for uber to compete in a rigged game.

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frozenport
They still do. Indeed Carl Icahn recently dumped his Apple stock for this
exact reason. Your market status in China is temporary, until the government
can replace you. More interestingly there are few Western companies that have
actually made a net positive cash flow out of China, even those that today
have large market shares ( such as automotive).

The relationship has consistently been unilateral free trade in the long term,
with investors giving money for market share and getting little in return.

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eva1984
Your argument doesn't hold. Apple is pretty replaceable in China, yet they are
making yuge money from this one market.

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Nicholas_C
Apple had a 2016 Q1 YoY decrease of 25% for revenue in China. They are still
making good money but the future is very uncertain for those cash flows.

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eva1984
Because 6S is a boring phone, and people didn't want it as bad as 6.

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GordonS
What would they _do_ with that much money?

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joeblau

      Both need capital to pay for recruiting drivers and subsidizing customer fares.
    

Last sentence, 3rd paragraph.

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robk
Or just last three words "subsidizing customer fares" is probably the bulk of
it

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joeblau
Recruiting drivers is also fairly expensive. I've seen a ton of "Get $500 to
start driving for <service>" all over the place. I'm sure similar campaigns
are being run in China as well.

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krzrak
It's sad when they write about you on Bloomberg and instead of your name
there's only "Uber's China rival"...

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Fennhella
Especially when that makes it sound neck on neck when in reality Uber is
trailing Didi Chuxing (formerly Didi Kuaidi) by a wide margin.

Didi Chuxing has 87.2% of the market according to research from the China
Internet Network Information Center.

[http://news.xinhuanet.com/english/2016-01/11/c_134998758.htm](http://news.xinhuanet.com/english/2016-01/11/c_134998758.htm)

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AustinMunday
I feel like that is expected. Uber can't win China if they don't want it too.
The Chinese state and people naturally want to produce this service (and
others, i.e. search engine) themselves, they don't need or want foreign
companies taking their market.

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realitycheckx
Disagree. Uber is not winning in China for one reason only - Didi is better
than Uber. It has nothing to do with Chinese government or people. Chinese
people love foreign brands, which are seen as being better and higher quality.
They buy iPhones, go to Startbucks etc.

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foobarqux
Why is Didi better?

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desireco42
Uber's China rival has a name.

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untog
But how many Bloomberg readers would be able to identify that name in a
headline?

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desireco42
It is a billion dollar company, just because it is not US based, we should
know it's name.

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untog
Right, but we don't. If you took a poll right now I'd bet the vast majority of
HN does not know its name. So IMO Bloomberg are absolutely right to not use
the name in a headline - they _do_ use the name in the article, which makes
total sense.

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modanq
Both companies are hemorrhaging cash by operating in China. Its a game of who
can survive longer, capital infusions are a way to lengthen the runway. Seems
like an ugly battle.

