
Uber is Fucked - noahmbarr
https://medium.com/@noahbarr/uber-is-fucked-long-term-3ed36a901d08#.ap6hfkf19
======
vannevar
Uber _is_ in trouble, but not for the reasons cited here. Driverless cars are
not coming as fast as the author thinks. Even in the example he gives, his
friend has to drive the Tesla at some point. This means that it has a driver
the entire time, even if he isn't doing much most of the trip. Widespread use
of driverless (as opposed to self-driving) cars is still 10 years away. Uber's
problem is not that they're going to get cut out of the driverless car
business; it's that their customers are really the drivers, and Uber offers
very little value to them for the cut they're taking. Uber is just a dispatch
service, which is rapidly becoming a low-margin commodity business. To the
driver, Uber is an app and a sticker. A driver just needs fares in their area,
and as Austin has shown, with modern geo-enabled phones, it's easy to jump
into the dispatch business to fill that need.

~~~
throwaway48511
>Uber is just a dispatch service

I don't think you are taking into account UberPool. HN comments almost never
do, perhaps because programmers are generally upper income and do not feel a
need to trade money for inconvenience, but UberX is basically a legacy product
and now presented as more of an upgrade if you're in a hurry, rather than the
default mode.

UberPool is everything. A network of cars buzzing around the city dynamically
routing from one task (transport passenger, transport package, deliver food,
etc) to the next, and each task is cheaper because it can share ride segments
with other customers.

That is where the winner-take-all argument comes from - the bigger the
network, the more efficiently Uber can pack multiple tasks into the same
driver-hours, with less delay (more jobs means the car doesn't have to go as
far out of its way to share capacity).

Uber is more than dispatch - it's quality control, reputation, dispute
resolution, capacity planning, payment escrow, (soon to be) routing (it bought
a few mapping companies), commercial insurance (try buying that on your own),
and increasingly, the efficiency provided by combining multiple tasks in each
car.

When people call Uber a taxi service - when is the last time a taxi offered
you a cheaper ride if you agreed to share the car for 5 blocks with a guy 10
blocks down the road?

Disclaimer: I used to work there. Throwaway because I'd rather keep
identifying information off my personal account.

Opinion is my own, I do not speak for Uber, etc.

~~~
vannevar
>Uber is more than dispatch

I still don't think that most of those checkboxes is terribly important to
either drivers or riders. If I were an Uber competitor, I'd thank Uber for
screening the drivers for me. Now I can offer them fares at half the price
Uber can offer them for. You have a point about delivery, but in the end
that's just another fare. There will certainly be good dispatch networks, and
Uber may be one of them, but none of them will be able to maintain high
margins, certainly not margins that would support Uber's valuation.

------
SCAQTony
Predictions will always look 100% certain if you presume the cause/problem
will never be mitigated.

Search up "The horse manure problem:

"...In 1894, the Times of London estimated that by 1950 every street in the
city would be buried nine feet deep in horse manure. One New York
prognosticator of the 1890s concluded that by 1930 the horse droppings would
rise to Manhattan’s third-story windows. ..."

[https://nofrakkingconsensus.com/2011/03/29/the-horse-
manure-...](https://nofrakkingconsensus.com/2011/03/29/the-horse-manure-
problem/)

------
whack
Even if you accept the author's assumption that driverless cars are very
close, his argument rests on the following premise:

 _Every single car manufacturer will launch their own uber-like app, market
their app directly to the end-user, and maintain a fleet of taxis nationwide,
in order to compete with Uber._

I find the above premise hard to believe. Why would a company like Nissan take
on the massive marketing/logistics challenges required to run a nationwide
taxi service? Do we really think the market can support 10+ car manufacturers
each running their own Uber-like app?

It's so much more likely that each car manufacturer will simply continue
trying to sell as much as possible, and let the buyers decide how they want to
make use of the car. Even if they do decide to "put their inventory cars to
work," they will do so by loaning the cars out to an aggregator like Uber, who
will then use these cars in order to run a taxi service. The idea that every
car manufacturer will decide to cut Uber out, and enter the taxi business
directly, just doesn't sound plausible nor smart.

~~~
warcher
Yeah, the car companies are also fucked. Prepare for massive consolidation on
that front. One or perhaps two or three car manufacturers will swallow the
whole market as demand craters. (We all own our own cars because it's a
necessity at this point. It won't stay that way in a driverless future. Nor
will cars be the status signifier they currently are.)

I actually think the form factor most cars come in will become obsolete-- I
think they'll be mostly vans and buses to cope with economies of scale on the
rider front and to handle rush hour surges. Who makes the bus you last rode
on? Do you know? I know I don't, nor do I care.

I mean, Uber is totally fucked if this comes down the pipe and they're not
running things, that's undeniable. Their value proposition is running this two
sided marketplace that's going to turn into a one sided marketplace. And yeah,
putting together a mobile app is a completely different universe than becoming
a major auto manufacturer, or a robotics manufacturer of unprecedented scale.
(Or in reality, both.)

~~~
erroneousfunk
Demand may go down, but I don't see the car market necessarily consolidating
(or going away) like you're implying here.

Technology and economic growth often _increases_ the number of "single
person/family" consumer products, rather than decreases them. The "sharing
economy" isn't necessarily the default goal that everyone progresses towards
for all products (although it may seem like that at times, living in a tech
bubble), and "cars" have historically been one of those products that people
buy more of, rather than less, as time goes on. Whether this will hold true in
the future, who knows? But I don't see it as a given that the market will
drastically decrease.

People like customizing their cars, storing things in them, the familiarity of
them, and treating them as a "home away from home" even if it's just going to
the grocery store. My husband even gets anxious when he's away from home
without his car (if, say, we're on vacation or we took a cab somewhere. He
never takes public transportation). It's a guaranteed safe place, a way back
home, and something he can count on. Sure, you may feel very differently, but
you are not every person.

And when you say: "Who makes the bus you last rode on?" Well, I did't have the
dubious pleasure of experiencing a city bus until I was 22. Sure, now I ride
one every day, but I know plenty of adults who have _never_ been on a bus,
much less have convenient access to a route. And while driverless vehicles may
facilitate the expansion of public transportation to increasingly rural areas,
at some point, you'll hit an absolute mathematical wall at which "the cost of
the car transporting itself from customer to customer" will be greater than
"the cost savings/reduced environmental impact of sharing the car"

Long story short: I think your assessment of the market is a little premature
and somewhat egocentric. Sure, it could absolutely happen that way, but I
could also see driverless cars becoming an even _more_ "single user/personal
consumer product" than they are today. It's hard to say.

~~~
warcher
Cars are expensive. Cars are also mostly sitting idle. These are objective
facts. For most of the country, the only bill bigger than their combined car
payment/maintenance is their mortgage. That's a lot of money.

I think a combination school-bus-for-adults/carpool would have a lot of
traction if you could automate it. How much is that gonna cut into the car
market? Remains to be seen. But not nothing, for sure. And moving cars into a
service model is, in my opinion, gonna make a lot of the pricing more
transparent. You want an SUV, you'll have to pay for it per ride. You want
your own private car, pay per ride. I think consumers, when faced with
spending the extra buck on an a la carte basis, are going to start looking
into cheaper options.

Rush hour surges are gonna be a big strain on the system, and I really think
that school bus model is going to take off. Everybody going more or less in
the same direction at the same time, get on the bus and save a ton of money.

Maybe it just turns multiple car families (the default) into single car
families. But even that would be a seismic shift in the auto industry.

------
inthewoods
To me, #1 is classic "inside the Valley" thinking - not recognizing that the
world outside of the Valley is vastly different. As a simple example, as far
as I know, no one is currently attempting autonomous cars in any place with
more severe or varied weather conditions (e.g. snow).

~~~
ttmb
In fact, Uber is. They have a research center in Pittsburgh, which has plenty
of weather and terrible roads. Cars are seen regularly dodging students around
CMU.

~~~
bichiliad
They are, and very aggressively so. They bought up a ton of CMU's research
department to do so[1].

[1]:
[http://www.theverge.com/transportation/2015/5/19/8622831/ube...](http://www.theverge.com/transportation/2015/5/19/8622831/uber-
self-driving-cars-carnegie-mellon-poached)

~~~
inthewoods
That's great to hear. Is the author's contention that Uber "doesn't have the
tech" accurate?

~~~
apendleton
The author mentions the CMU acquisition. I think their contention is that it's
not enough, because Uber doesn't have access to the kinds of vehicle telemetry
data its competitors do that would be necessary to train good self-driving car
models. Google, and other companies with existing advanced vehicles on the
road, have thousands of cars in the wild now with suits of sensors collecting
telemetry and phoning home. Uber contracts drivers who drive their own cars,
so it's not benefiting in a vehicle-telemetry sense from the drives it's
arranging in the way it could be and its competitors do.

I think this is probably a solvable problem, though.

------
rsp1984
_By the way, robotics teams have traditionally been steeped in rules-based
AI’s. Essentially enormous if-then decision logic tree. Even if they are using
the most advanced self-learning algorithms, huge amounts of data are required
to train, perfect, and ship such a system. Uber has access to essentially NONE
of it._

Sorry but there's so much BS condensed in just these two sentences that it
immediately disqualifies the whole article.

Of course robotics software isn't based on giant decision trees, wtf. Then
what's a self-learning algorithm? Who says that Uber couldn't just license
self-driving tech or data? And by the way the plural of AI is AIs, without the
apostrophe.

------
kin
Isn't Google invested in Uber? Didn't Uber order 100,000 units of Mercedes
vehicles to do something with? Isn't GM partnered with Lyft to accomplish a
self-driving taxi service?

I don't know, I think Uber and Lyft are well aware of the progress in self-
driving vehicle technology and their actions point more towards them behind
involved in the process as opposed to being left in the dust. The only group
of people that are "fucked" are the current drivers whose jobs will be
automated.

~~~
dave_sullivan
Let's say that's true; the folks at Uber are smart and they'll figure out self
driving cars. Why does anyone think Uber will be able to maintain an advantage
with that? What's to stop anyone from buying some self driving cars and
opening their own service? How does the whole industry not become a race to
the bottom? Hell, given the price wars going on now, I'd argue it already has.

Uber is in a low-margin business where the only way to really increase profit
is to screw your customers or employees or both. If self driving cars are
supposed to be the company's savior, good luck being the only organization on
the planet that can use them. Having lived through Webvan, Groupon, Zynga, and
countless others, I see disturbingly similar patterns in Uber.

~~~
rco8786
You can basically just swap in any company in any industry to your
comment...keeping up pace with technological changes, competitors entering
your market, and maintaining a profit margin are just normal challenges that
every business faces.

Let's see:

> Let's say that's true; the folks at Google are smart and they'll figure out
> artificial intelligence. Why does anyone think Google will be able to
> maintain an advantage with that? What's to stop anyone from buying
> artificial intelligence tools and opening their own AI service? How does the
> whole industry not become a race to the bottom? Hell, given the price wars
> going on now, I'd argue it already has.

> Let's say that's true; the folks at Apple are smart and they'll figure out
> personal computers. Why does anyone think Apple will be able to maintain an
> advantage with that? What's to stop anyone from buying some computer parts
> and opening their own computer store? How does the whole industry not become
> a race to the bottom? Hell, given the price wars going on now, I'd argue it
> already has.

> Let's say that's true; the folks at SpaceX are smart and they'll figure out
> re-usable rockets. Why does anyone think SpaceX will be able to maintain an
> advantage with that? What's to stop anyone from buying some re-usable
> rockets and opening their own space travel agency? How does the whole
> industry not become a race to the bottom? Hell, given the price wars going
> on now, I'd argue it already has.

~~~
dave_sullivan
Google: They have an advantage in search that I think would be hard for a new
entrant to overcome (mostly because of the amount of data they've collected).
I don't think their advantage is algorithmic at this point so much as lots of
data + they're a verb. Uber is practically a verb at this point, but I think
their data is less valuable. I guess it would be comparable to Foursquare's
data, but much more of it.

Apple: The whole industry _has_ become a race to the bottom, except for Apple
which has built a phenomenal brand (also see Nike for example of a valuable
brand). I don't think the Uber brand is worth all that much.

SpaceX: I think it's fair to say setting up a rocket company has significantly
higher barriers to entry than building a taxi dispatching app.

But Groupon I think fits:

Let's say that's true; the folks at Groupon are smart and they'll figure out
online coupons. Why does anyone think Groupon will be able to maintain an
advantage with that? What's to stop anyone from hiring some web developers and
opening their own daily deals website? How does the whole industry not become
a race to the bottom? Hell, given the price wars going on now, I'd argue it
already has.

In the case of Uber, I'm arguing that the barrier to entry for other companies
will be buying several cars in a retail market, because various manufacturers
will be selling them.

------
digitalpacman
Good luck for it to be legal that a drunk person can be in the drivers seat of
a car. That's going to take 20-30 years. I'm sorry but there isn't "you can't
operate an elevator while drunk" law and people in police elevators pulling
you over to the first floor to give you a ticket.

Until they remove the ability for drivers to actually drive, they are going to
be legally responsible. Uber is fine for the next 30-50 years.

------
verylongaccount
Aren't self driving cars good for Uber? My understanding is that Uber's plan
in the event that self driving cars become practical is to have a fleet of
them which can be summoned by users on demand.

~~~
haney
That's assuming that the creators of the self driving car technology don't
decide to operate their own network of cars and cut out the middle man.

~~~
georgecmu
Uber has aggressively invested into developing its own self-driving
technology. This has been extensively discussed on HN.

See some nice photos here: [http://qz.com/688003/ubers-self-driving-cars-are-
on-the-road...](http://qz.com/688003/ubers-self-driving-cars-are-on-the-road/)

------
bko
The conclusion at the end is that car manufacturers are better suited to
benefit from driverless cars as Uber is not in the business of building or
maintaining a fleet of cards. But by that same reasoning, manufacturers are
not in the business of dispatching taxis.

I'm skeptical that manufacturers would be that nimble to capitalize on the
inevitable. That's also not their business model. Building out such an effort
in such a large organization would be a challenge. It would be much cheaper
for car manufacturers to partner with or buy a company like Uber.

In regard to Uber not having data to create the machine learning models needed
for self-driving cards, they could buy that data or start building it up
themselves. Google doesn't have a monopoly on strapping cameras and sensors to
cars. And Uber certainly has enough capital required. Besides, this is a core
strategy for Uber while it's still a moon-shot for Google.

~~~
galdosdi
But it's way easier to enter the dispatch app business than the car
manufacturing business, as is demonstrated by Uber's menagerie of competitors.

While car manufacturers are hardly the nimblest they're not brain dead and are
already exploring related stuff (example:
[https://www.washingtonpost.com/news/dr-
gridlock/wp/2016/07/1...](https://www.washingtonpost.com/news/dr-
gridlock/wp/2016/07/18/gm-launches-new-car-sharing-service-in-d-c/))

If we reach a day where there is some company, call them company U which has a
successful dispatch app business, and another company, call them company C,
which has just successfully demonstrated (and passed regulatory hurdles for) a
self driving car, what do you think will be easier and cheaper and quicker?
For U to develop/acquire/license self-driving car technology or for C to
develop/acquire/license a dispatch app?

C could probably pay very little to license a dispatch app from any of the
many vendors. Even if it's not popular before, it will be once it's the only
dispatch app that dispatches SELF DRIVING CARS! But if U tried to license self
driving from C, U would probably have very little leverage and end up signing
a contract where U runs the show but ships most of the revenues to C. C would
be like Microsoft in the 80s/90s, and U would be like a generic IBM PC
compatible computer vendor.

------
chollida1
> Self driving cars are coming fast. It’s largely a solved problem.

Something about the Ninety-ninety rule seems appropriate here:

[https://en.wikipedia.org/wiki/Ninety-
ninety_rule](https://en.wikipedia.org/wiki/Ninety-ninety_rule)

I think self driving cars are much closer to 10 years out than the "today"
that the author asserts, but I think everyone agree's that we've reached the
point where they are coming no matter what.

To give the author credit I went into reading this thinking he was absurd but
he does make a good point, some of the points I think are over sold, like
planned obsolescence but I think his thesis is sound.

One point I'll make on Uber's behalf......

Two of my all time favorite books are:

[https://www.amazon.com/Startup-Silicon-Adventure-Jerry-
Kapla...](https://www.amazon.com/Startup-Silicon-Adventure-Jerry-
Kaplan/dp/0140257314)

This history of Go computing.

and Ben Horowitz The hard thing about hard things.

[https://www.amazon.com/Hard-Thing-About-Things-
Building/dp/0...](https://www.amazon.com/Hard-Thing-About-Things-
Building/dp/0062273205)

Both do a very good job of bringing the reader into the chaotic environment
that occurs when startups are in trouble and both have a very similar message.
When startups get in trouble having very powerful investors and mentors can
make a huge difference.

Uber has some very influential backers. See:

[https://www.crunchbase.com/organization/uber/investors](https://www.crunchbase.com/organization/uber/investors)

If/When times get tough, they have people who have a vested interest in seeing
them succeed. People who can get them talking to the correct people at the car
manufacturers to convince them to use Uber's platform over an internally
created one.

If self driving laws drag on many years before they are settled then Uber may
be fucked in the end but there isn't any reason why they can't be a cash
printing machine over the next 10- 20 years while self driving cars replace
humans.

As to car companies cutting out uber, there is this.....

[http://qz.com/688003/ubers-self-driving-cars-are-on-the-
road...](http://qz.com/688003/ubers-self-driving-cars-are-on-the-road/)

~~~
Blaaguuu
I had a hearty chuckle at the "It’s largely a solved problem." line. It does
seem like in the next 5 years or so we'll be about 99% of the way to fully
automated vehicles that can pick you up and take you anywhere a 'normal' car
and driver can go... But that last 1% is a bunch of incredibly difficult
problems that could easily take another 10-20 years.

------
sokoloff
> There’s a good reason cars start falling apart after their warranty period —
> They have been carefully engineered to specifically have this happen, a term
> called “planned obsolesce”. Manufacturers want to sell more cars, and if
> cars last longer, they sell way less new cars.

My experiences are vastly different. Neither my Mercedes nor my wife's Honda
have "fallen apart" after the warranty period. MB is 216K miles and 18 years
old and Honda is ~170K miles and 11 years old. Both have averaged under $200
in parts per year, mostly brakes and tires.

~~~
niftich
Indeed. Obsolescence does occur with cars -- just like most consumer items --
but it's either:

\- technical or functional obsolescence (eg. no rearview backup camera,
carburetors replaced with fuel injection), or

\- style obsolescence (eg. station wagons, quirky headlamps) because styling
is a subjective fashion statement. While this is arguably a sub-type of
_planned_ obsolescence, it affects every single object that has visual
presence, from clothes to smartphones to household appliances.

The kind of 'intentionally crippled engineering designed to fail after the
warranty period' the author proposes does not exist, because new cars are
perfectly capable of getting themselves sold on their merits, and not because
all old cars have been intentionally crippled. In fact, selling secondhand
cars is quite often profitable, while selling new cars, outside of the
luxury/SUV segment, has notoriously low margins.

------
hackaflocka
> Car manufacturers will begin flirting with building, owning, and deploying
> their own cars…via their own apps.

Music cos. were supposed to do something similar to iTunes etc. Didn't happen.

> Cars will appear when ordered through the app. They will drive off and
> disappear when you step out of the car. When running low on fuel, cars will
> coordinate trips to tucked away re-charging depots to be smartly refilled
> with electricity.

You mean in about 20 years time?

> Then car manufacturers will drastically start reducing the cost of operating
> these vehicles.

With magic?

------
heisenbit
Ueber has strategic challenges as transportation solution provider. The way I
see it Ueber

\- has few barriers to entry in it's business besides brand.

\- scaling up, maturing is dulling the brand

\- as a dominant player with a large war chest it may engage in price wars but
as a dominant player it will risk regulatory trouble when overdoing it.

\- established players will adjust e.g. Taxis orgs. with their app or
regional/local public transport integration with car sharing

\- while self driving cars may be a little off the concept of ad-hoc renting a
car without a driver is catching on in Germany. Like a taxi one rents a car by
the minute and drops the car when arriving. Daimler/Smart, BMW and German
public railways are all in. This seems also the proving ground for small
electric cars - operating a fleet of your own vehicle is probably providing
some insights.

Millennial car ownership is dropping vs. earlier generation. So the underlying
fundamentals for new transportation solutions are strong. However it is far
from clear what role Ueber will have in the medium term.

------
payne92
Self-driving _cruise control_ is largely a solved problem, but 100% self-
driving is a long time away. Ref: Boston winter, 2015.

------
tmaly
There are a ton of different regulatory jurisdictions that this whole self-
driving tech will have to get through before I would worry.

------
slaunchwise
> Self driving cars are coming fast. It’s largely a solved problem.

Come to Boston.

------
eastbayjake
It's extreme to say Uber is effed, but it would be reasonable to suggest that
Uber is not a ~$60 billion business and that most of its long-term value will
be as a dispatch service with an established customer base that gets acquired
by a GM/Google self-driving fleet operator for less than its current value.

------
larrik
> There’s a good reason cars start falling apart after their warranty period —
> They have been carefully engineered to specifically have this happen, a term
> called “planned obsolesce”.

I don't believe this, and I don't believe the author knows anything about
cars, from reading this.

------
vonnik
This is a piece of amateur speculation making huge assumptions about advances
in technology, and about Uber's ability to adapt to those advances.

One crucial thing to remember, when considering the threat Uber faces from
traditional car manufacturers, is that Uber is a software company and they are
not. It has a huge advantage in product development, and stands just as good a
chance as they do of coming out with self-driving cars for ride-sharing.

~~~
benologist
Why is that even important, let alone crucial?

Anyone can hire programmers, children can ship products, MLB created a
Netflix-like platform to offer media companies as a service, Walmart have made
important contributions to open source etc.

The number of steps between Uber's competitors becoming as competent as Uber
at software is basically "1\. decide to".

~~~
vonnik
Attracting the talent to build a usable product is one of the most important
steps in creating any business, or line of business in the case of a large
company. That talent is scarce, and tends to prefer certain companies over
others. I speak as a former recruiter and current employer, who has had to
grapple with the difficulty of hiring good software engineers.

The software engineers I have known and tried to recruit tend to want to work
for companies that are more like Google and less like General Motors.

The statement _Anyone can hire programmers, children can ship products_ is
manifestly untrue. It's hard to get the right people, and it's equally hard to
coordinate all their activities to get a successful product over the finish
line.

The companies that have healthy cultures of software engineering and digital
product management and design are way, way ahead of everyone else. And those
companies are in the minority.

~~~
benologist
General Motors is another great example of a "non-software" company that
effortlessly became staffed to rival Uber's employees -

[http://fortune.com/2016/03/11/gm-buying-self-driving-tech-
st...](http://fortune.com/2016/03/11/gm-buying-self-driving-tech-startup-for-
more-than-1-billion/)

~~~
vonnik
You simply don't know what you're talking about. _Effortlessly_ , first of
all, is false. Secondly, while the hiring of thousands of software engineers
over the last few years was trumpeted, that doesn't mean GM knows how to
manage them. That applies, even more strongly, to the acquisition of Cruise
that you cited. That happened three months ago, so it isn't clear how much
talent will stay for how long. But the fact that they had to buy it meant they
decided they couldn't build it themselves in a reasonable amount of time.

~~~
benologist
Effortless was referring to how quickly they positioned themselves to compete
in an emerging landscape with lots of startups - one deal staffed them up.
Whether they can manage those people effectively or ship big projects ... is a
problem startups face too.

~~~
vonnik
Yes, but my precise point is that startups lure talent and iterate on product
better than most large corporations, with enclaves and exceptions in a few
large-ish companies, and virtually none any where else. $1B is the monetary
expression of a lot of effort, and it's unclear whether they can actually do
anything with what they bought. Most mergers and acquisitions are failures.

------
dogma1138
Self driving cars that are beyond simply assisted driving or and overseen
autopilot are probably 10-20 years away. It would take quite a bit of
additional improvement in tech and massive legislation for driverless cars to
become a common thing. I don't understand why people continue to mix self
driving and driverless those are 2 separate things. Autopilot or not I don't
see most countries change the law of both hands on the wheel (unless you need
to operate another system in the car in which case 1 hand might be taken off
it) any time soon. Infact with autopilot becoming more and more popular you
might see actually increased enforcement of this law because It's another
revenue stream for local authorities.

Also if anything Uber is the one that stems to benefit from driverless car
since they won't have to pay the drivers any more. With driverless cars I see
their business model becoming something like "want to save 30% on your monthly
car payments? sign up your car to Uber!", Uber can even offer financing
options to people at considerably discounted rates in exchange for a mandatory
opt in period. Heck Uber can go Zip car and simply manage their own fleet when
driverless cars become a true reality, it might even be easier for companies
like Uber to get a driverless car before the general population, they've
already built their platform and have a user base, the drivers are this point
are a necessary liability for them the minute they can dump them they will.
And if the car makers would want to offer a similar service themselves well
Uber can just come in as a service provider offer the car manufacturers access
to it's user base and platform in exchange for a usage fee it would be even
better for them since they could dump a huge chunk of their existing liability
onto their partners.

~~~
troymc
As soon as there's strong evidence (from multiple credible sources) that self-
driving tech reduces accidents and fatalities, the government conversation
will switch from, "How shall we regulate this?" to "Oh! These are like seat
belts. How shall we encourage them?" In other words, governments will _speed
up_ adoption, eventually.

The owners of the car fleets will be the car manufacturers because they're the
ones who can pay the least per car. They don't have to pay any markup!

The self-driving tech will come from Google, Tesla, Apple, or the like, not
Uber. See the blog post for the reasons why.

~~~
dogma1138
>As soon as there's strong evidence (from multiple credible sources) that
self-driving tech reduces accidents and fatalities, the government
conversation will switch from, "How shall we regulate this?" to "Oh! These are
like seat belts. How shall we encourage them?"

Only 34 states have a primary seat belt law and that took decades of
legislature to push through. Legislation takes time, if you think it would be
10 years before we have enough data on autopilot you are fooling yourself, and
going from autopilot to driverless will not happen overnight. If we take the
US then again it's unlikely that the federal government would get involved on
any reasonable time table, this means that the driverless car makers would
have to lobby each state individually. Until the big car makers would have a
foolproof driverless car Apple and Tesla can do whatever they want they will
not match the power of the auto industry lobby just look at how much problems
Tesla is having over dealerships.

It doesn't matter who's making the driverless car, Uber has the user base and
the platform saying that Tesla is making a driverless car is meaningless
unless you would want to make the same argument that Uber should only onboard
drivers that drive a Honda or a Ford today because they their cars come in
blue.

If Uber survives until driverless cars really pick up (and BTW the 10-20 year
window isn't only my opinion, I don't think even Tesla thinks that their car
would become driverless road ready or road legal before 2025) and is not torn
apart but anti-Uber legislation and sentiment then the driverless car would be
the thing to save it not kill it.

------
cjbprime
> Self driving cars are coming fast.

Yes, and Uber is working on them. On HN as the same time as this article:
[http://qz.com/688003/ubers-self-driving-cars-are-on-the-
road...](http://qz.com/688003/ubers-self-driving-cars-are-on-the-road/)

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niftich
1\. Self driving cars are not coming fast enough, but _their impact on Uber 's
business model is unclear_. They've been investing in self-driving cars [1],
but they've also been expanding into parcel delivery, which needs a human to
perform the actual contact with the customer [2].

2\. Like the article says, Uber indeed is collecting sensor data in
Pittsburgh, to train self-driving algorithms. They may or may not be able to
deliver an algorithm rivaling the quality of Google or other players. _It 's
contradictory to say Uber has access to no car data, while pointing out that
Uber is collecting car sensor data on their own._

The passengers who use Uber may not be very brand-loyal, but that assumes
their business model is entirely predicated on customer fares. In truth, their
business model is entirely predicated on burning VC money to establish first
mover advantage and mindshare, and if they successfully pivot into
profitability they will presumably alter business models. _Licensing self-
driving tech, charging for rush parcel deliveries, providing concierge
services_ \-- those are all viable directions in which they can pivot.

3\. Being in the business of fleet maintenance is not so fun, and location-
aware dispatching, load balancing, etc, requires the sort of secret sauce
that, among a few others, Uber has developed. Car manufactures won't engage in
this as their core business; they're far more likely to partner with some
startup Uber competitor, or Uber itself. But car manufactures aren't like
airplanes where the cost of a single unit is so high that it's much more
economical to lease indefinitely. Many people in fact own cars -- _the very,
very profitable used car market_ is evidence of this, which unlike most new
cars, actually has decent margins. While it's true that carmakers have
subsidiary banks that offer financing, those instruments enable a larger
portion of people to 'buy cars' than otherwise, increasing the total volume of
cars delivered. _Extremely widespread, mainstream car-hailing on demand would
drastically drop the demand for car ownership_ (in terms of raw numbers)
across the board, making it an awful value proposition for car manufactures.

[1] [https://newsroom.uber.com/us-pennsylvania/new-
wheels/](https://newsroom.uber.com/us-pennsylvania/new-wheels/)

[2] [https://rush.uber.com/how-it-works](https://rush.uber.com/how-it-works)

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mrcwinn
An analysis of a business today doesn't mean much for the state of a business
tomorrow. Companies and situations change. So, for the people happily working
for Uber, probably don't quit your job as the author suggests.

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vermontdevil
Uber does have access to car data - the cars Uber drivers use. I don't know if
Uber is using this data to help adapt over the long term. But it's something
they do have access right now.

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Grue3
Fusion is also pretty much a solved problem. They even have that one
experimental reactor in Europe. The power generation industry is fucked!

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whazor
Uber has volume and the correct branding, both important parts which a company
like Audi will need.

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sethish
I think the author's spellcheck is fucked. Probably also their chain of
reasoning.

