There's probably a balance to be struck, because part of the ridesharing design's efficiency is that if demand drops they can drop their rates paid to drivers, and the drivers who don't want to drive at those prices will stop.

So if Lyft starts to say "we always want X drivers available as a base load, and we'll open up to contractors to fill in the demand spikes" it might make the contractor role too unreliable for anyone to bother doing it. At the very least, their costs would go up for both the employed drivers and the extra contractor drivers. Since their valuations comes mainly from a cheap labor pool, that presumably kills it.

But in the current situation, if all their drivers at the airport sign off and say "I'm not driving at these prices," you get surge pricing to make it worth driving, that increases costs too. That's what happens when you're buying labor from independent contractors - if they don't want to sell it to you at a particular time for any reason, they don't have to.

The real question here is "If Lyft recognizes when these organized sign-offs are happening, calls their bluff, and refuses to activate surge pricing, what happens?"

Do the drivers really refuse to drive at the regular pricing and go home? Or do they all give in to a more tamper-resistant algorithm and keep driving at regular rates?

> And suddenly Uber/Lyft are like any other Taxi company just with a massive valuation.

What taxi companies have drivers as actual employees and not independent contractors?

I think they'd retain some of that valuation. Unlike traditional cabs, they show up (I've been stranded by more cabs called by phone then I've taken, not hyperbole). But the value of some unified dispatcher framework, with penalties for abandoning customers probably isn't in the tens of billions. Maybe in the hundreds of millions? Either self driving cars change everything, quite quickly, or some people are going to lose a lot of money.

"And suddenly Uber/Lyft are like any other Taxi company just with a massive valuation." . . . which valuation would be rapidly evaporating.

I suspect this will happen one way or the other, as something that cannot be sustained will not be -- something's got to give, either rates will go up, costs will go down, or the companies will fold.

Rates probably have some room to rise. My limited experience is mostly airport rides, where they are cheaper than limo's taxis. But I'd still pay the same as the competing services, since Lyft has always been more reliable and pleasant. The main competition is parking.

Lower costs? I don't think so, short of automation. The drivers' costs & compensation have already evidently been pushed to the limit, as they are starting to strike.

Will they sort out either? I'm not buying either stock, even at the discount prices...

Not quite. Real taxi corporations have approval of city/state assembly to do business so that they control the amount of taxi cars being part of daily street flow. (Im ignoring the fact that this system is broken and corrupted)

If their workforce suddenly switched from contractor to employee, I expect that valuation would evaporate.

> any other Taxi company

Except world wide (or us wide).

Well, not for long...

Exactly.