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Comment by koenigdavidmj | Hacker News Reader

Uber's value is this:

1. Same interface in any city. I don't need to figure out what the taxi phone number is (or what they are in case of multiple companies).

2. I can get a car somewhere other than downtown.

3. I can pay with credit, without fear that a driver will (best case) lie that the credit card machine is not working, until I say I don't have cash, or (worst case) kidnap me and take me to an ATM.

4. No silly medallion limits, so I never need to wait for long, even at closing time.

They really don't need to do the Ponzi scheme thing, hemorrhaging money and leaving the VC with the bill. Plenty of people will gladly pay more than a cab for the above benefits. In that sense, taxis are not really a competitor.

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These are consumer benefits, what does this have to do with Uber being a great business?

Right now, Uber's business model is throw so much VC money at everything that everybody else goes out of business, and hope the taxis die before you run out of VC money.

So Uber's short/mid term plan is to put all taxis out of business by lowering prices using VC money and their long term plan is to use autopilot cars to leave all drivers jobless.

And the other day there was an engineer from Uber commenting how ethical the company was.

I'm sure their engineering team is very ethical and responsible. But their business model and plan is actually very questionable. It's like they are hiding the highly questionable business ethics behind the good engineering ethics.

Or is there a point I'm missing?

Don't forget the whole dodging regulations thing. This aspect of the "sharing" economy I find the most disgusting.

Ethics goes out of the window in the pursuit of profit.

BS. The "ethics" went out the window when the taxi cartels captured the regulators in the first place.

Don't want people to play a crooked game? Don't set one up.

That's a shortsighted view. Similar to saying that the Airplane cartel captured the regulators and are preventing indie airlines from starting up...

Regulations exist for many reasons, not all are designed to act as a barrier for new entrants. Consumer safety springs to mind...

Have to agree to disagree on this one. Comparing taxi medallions to the FAR is enough of a stretch that I don't see a further basis for discussion.

Yes the comparison is ridiculous, but so is your complete dismissal of taxi regulations. If you can't see that, then I agree that there is no further basis for discussion.

Plus acknowledging that regulations do provide some benefit is reasonable. Regulations ensure that: * Taxis are regularly maintained * Pricing is standardized, transparent, with rules to prevent gouging during "surge" periods * Background checks for drivers * Drivers are qualified (have to pass various tests to get licensed)

On a more philosophical level, I think taxis serve a public utility function, similar to busses and subways. In this sense, some government oversight makes sense.

This is the point you're missing: https://en.wikipedia.org/wiki/Parable_of_the_broken_window

I think most of the criticism of uber are valid... but the status quo they're working against (taxis and drunk driving) have enough downsides that I don't think the ethical calculus around their business practices is simple.

How would you explain UberTaxi?

Because without above consumer benefits, people would not use Uber, and it would stand no chance whatsoever of being a profitable business.

Would people pay for these benefits if Uber was 20% more expensive than it is now? 50%? 100%?

This is a question worth considering, given that rides are currently subsidized with VC $$$.

I don't think anyone is disputing that Uber is a great service — it's been a game changer for the consumer.

What's continually being debated, however, is what Uber is as a business enterprise, which is what the article is about.

Uber is interesting in that they're a facilitator of a commodity in which they're not all that crucial to the equation. They're the eBay or Google Search equivalent of transportation, where they give users and workers access to a common marketplace (not quite a market, since the workers are not able to set prices; I'm sure there's a proper economic term for what it really is) and the real work is done by the drivers. But they're not a monopoly, and that marketplace exists at the whim of the customer, who might not have the brand loyalty to stick around.

I mean this only makes sense if it's affordable for the rider, driver, and Uber. There's simply no evidence this is even likely: only the rider benefits. Which is enough to destroy existing taxi companies.

What would have been great would have been a universal ride hailing app hooking into the local companies.

Uber and Lyft left Austin at the beginning of the year over fingerprinting rules. Since then, there has been an explosion of smaller ride sharing companies: Fare, Fasten, GetMe, and, most interestingly, RideAustin, which is a local non profit started by Austin tech luminaries. The apps were certainly much buggier than Uber or Lyft when they started, but I recently took a Ride Austin, and the app is so similar to Uber (as was the experience), that I wonder if Ride Austin will eventually branch out into other cities, at least by licensing their tech.

The Texas lege will likely override Austin's local regulations next year, so it will be interesting to see what happens when the fingerprinting requirements go away and Uber and Lyft come back.

#2 and #3 are why taxis are regulated. Yet people complain about medallions and taxi regulations.

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