Companies already price by predicting what people are willing to pay, by theory and experimentation. I wouldn't expect them having perfect information change much other than quicker convergence to the prices they would set anyway.
Companies already price by predicting what people are willing to pay, by theory and experimentation. I wouldn't expect them having perfect information change much other than quicker convergence to the prices they would set anyway.
Simply having another player in the field is not competition, despite the federal government's claims.
It is, however, hard to get drivers and customers FOR your ride sharing app.
But even if they were, the drivers are in a competitive labor market. If you get the customers with lower prices then you can also get the drivers because they'd rather be working for your rate than not at all.
Plenty of Uber/Lyft competitors have tried and failed. Heck, a few different companies tried here in Austin once we grew a spine and banned Uber/Lyft, only to die as soon as they came back to town.
Thus, you have economies of scale for multiple reasons (big upfront investments for app and marketing, network effects).
As such, there are high barriers to entry.
then why are there only 2?
So does anyone else who is doing work. For example, have a contractor come by your home to give an estimate on roof repair. It'll be highly dependent on him sizing up you and what you can apparently afford.
When I had my roof replaced, estimates ranged from $12,000 to $75,000. We got 11 bids and paid $14k. That’s market forces at work, but also an example of a market without high capital costs.
The 54k bid included a whole house energy audit with positive pressure tests and some stupid stuff. The bids from 6k to 32k were for the same literal shingles (architectural ) with the same installation and the same tear off and the same warranty.
The one pattern I noticed was the bids over 25k showed me a video with company values. (One talked about how Christian the owners were) The bids under 25k I got like a 5 minute explanation and a chance to ask questions.
Think I spent like 7k on the roof and it’s great.
My dad got a siding company that quoted $120k to do the job in the middle of winter for $30k.
When you have no jobs, you'll take almost break even to prevent employee loss.