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Comment by draw_down | Hacker News Reader

The network effect lies in the chicken-and-egg relationship of riders and drivers, no? Drivers drive for the service that has the most fares, users pick the app with the most cars available.

Similar to selling & buying on eBay, though maybe not quite the same since both sides can be on multiple apps at once.

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But drivers can drive for multiple services at the same time, using whichever one is giving them a customer at any specific moment. I've talked to many Uber/Lyft drivers that use both apps at the same time.

On the consumer side, having the most cars available is not the only thing to consider. There's also price. For me, Uber is the first app I check (mostly out of habit), but if there's any sort of surge pricing going on, I'll check Lyft. If Lyft doesn't have a similar surge, I'll usually ride with them, even if it means a slightly longer wait.

You are correct... for now. But the way I see it all going down is only the top marketplace will survive and the rest will shut down. Sure, they may even generate revenue, but I think those that don't manage to become the top will fade away for the same reason most acquired companies die off. When that happens, there won't be any Lyft. Lyft knows this and that's why they took investment from GM, and this is why Sidecar shut down recently.

Both drivers and riders can be bought. If you geographically constrain the area targeted then the costs can be kept under control.

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