They are basically biding their time until driverless cars take off it seems.
Let's assume, for the sake of argument, that the concept is viable in urban areas within 5 years and Uber puts a massive fleet of self driving vehicles on the road.
While it's certainly true that they wouldn't have to pay drivers it would be a massive shift in capital investment.
The "genius" of Uber is shifting the necessary capital investment for hundreds of thousands of vehicles onto the drivers.
Assuming one car costs 30K (which I think is on the very low side) it costs 3Billion to put 100'000 cars (which also seems very low with Uber's global ambition) on the road.
That's an upfront investment currently incurred by the drivers.
The second point is that there are two keys to making money out of this: Have self-driving cars, find customers to rent the self-driving cars. Uber is already established in the second part. So it might be true that another company buys the cars and tries to run the business, but uber has the established customer base.
In my opinion the future of self-driving cars inevitably ends up with one of the big players buying uber to allow them to monetize their fleet.
Also, I never understood what kind of problem companies are trying to solve with self driving cars to be honest. Traffic in cities will be the same, if not worse. And I consider driving as one of the things I really enjoy doing. Why take that away?
So it has to buy parking.
What happens when they break down?
Servicing.
How often do they have to replace their fleet?
$3 billion every 5 years.
> So it has to buy parking.
Rent parking spaces in people's driveways! :-)
So, at best, they become a 40-billion dollar driver/rider match-making algorithm and a pretty CRUD app. Unless Uber itself is working on autonomous driving technology. It's so easy for drivers and riders to switch between ridesharing apps (e.g., ever see an Uber driver that also has a Lyft sticker on their car? I have, many times), I don't see how any of them can solidify a competitive advantage of sorts long-term.
But looks like I was wrong. They do have a self driving car service running for a group of testers, but apparently it is currently free so I don't think it counts. On the other hand they've got permission to start charging and have said they plan to this year, so I'd still expect them to beat Tesla.
Source: https://www.digitaltrends.com/cars/waymo-now-a-full-ride-hai...
I think the optimists are thinking "oh, the high-level problem of image recognition and building a 3D model of the area around the car is pretty much a solved problem, great, done!" But in fact, it's all the edge cases that will kill you. What happens when it is dark and rainy and the car in front of you is black, with no license plate? What happens when the car in front of you hits something in front of them unexpectedly? What happens when the car gets a flat tire? What happens when someone doesn't look in their mirrors before changing lanes? What happens when your "there's a problem" solution (like, say, stopping or slowing down) is actually not a good solution?
I have been in all of those situations except for the black car, and the humans involved all made spectacularly poor decisions.
People who claim that self-driving cars will have failure modes far underestimate the failure modes that humans have.
Now they have permits to run around 100% humanless apparently.
In the 2004 DARPA Grand Challenge, of 21 teams entered, 15 qualified to race on the course, and none finished the 240 km course. The best result was 12km. That was off road, with no requirement to obey traffic laws or other cars to hit.
Since 2009, Google/Waymo has 5 million driverless miles under their belt.
Is it 5 years away? I don't know, but this is not the same story forever. This is iterating and improving at a breakneck pace.
The problem with predicting these curves is there's usually a confluence of factors that lead to that tipping point. When the right algorithms, hardware, and software are combined it'll be obvious in retrospect, but right now we're still fumbling around with primitive solutions.
When will there be a TPU-type device suitable for in-car use? When will there be adaptive deep-learning algorithms available that can work in the demanding real-time environment of a vehicle? When will enough testing be done that we know such a solution can work without endangering people?
It will happen, but pinning down when is very hard. You'll only know when you're close, and by then you're already flipping from impossible to inevitable.
[1] https://googleblog.blogspot.com/2010/10/what-were-driving-at...
(But yeah, we are very far from cars navigating urban areas, or indeed anyplace where weather is inclement and so are people.)
If cars with safety drivers don't count, nearly a year ago if you move to Pheonix and get lucky [1]. They're apparently planning to launch in more cities "soon" (though I can't find a list or date) [2] and they've recently got permission to start charging passengers and intend to by the end of they year [3].
So I think "decades" is an exaggeration.
[0] https://www.theverge.com/2017/12/6/16742924/lyft-nutonomy-bo...
[1] https://www.theverge.com/2017/4/25/15415840/waymo-self-drivi...
[2] https://www.theatlantic.com/technology/archive/2018/01/waymo...
[3] https://www.digitaltrends.com/cars/waymo-now-a-full-ride-hai...
Even if you have a driverless solution today it'll take years to test it and get it certified.