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Comment by mjr00 | Hacker News Reader

> Take Uber, one of their key examples. It'd be one thing if the company had simply outcompeted taxicabs on the merits. Cabs, after all, were themselves a fat and complacent monopoly.

Uber/Lyft did outcompete taxis on merit, and to suggest otherwise is revisionist history! Before ride-sharing apps, the process for getting a taxi was:

1. Stand on a street corner (if you're in a busy area) or make a call if you're not. If you have to make a call, there's a ~20% chance a taxi actually shows up.

2. Get in the taxi, tell your driver where to go and how to get there since they could otherwise take a more expensive and profitable route.

3. When you're at you destination, pay the driver. 80% chance they will say "the machine is not working," offering to take you to an ATM to get cash if needed. Note that the machine magically works when you shrug and tell them you're not obligated to pay if the reader is broken.

Ride-sharing apps completely changed the game. Suddenly you know exactly how much you had to pay, in advance. You knew exactly where your ride was so you had an estimated arrival time. You knew exactly what route they were taking.

People talk about how Uber/Lyft dodged taxi regulation, which is true, but the reason there was so much regulation around taxis in the first place was because the old system was so ripe for abuse. Imagine being a tourist landing at an airport and taking a taxi to your hotel; what if you got into a cab and they charged a hidden $20 "airport pickup fee," or took the scenic route, or simply charged a higher rate than the car in front of them? That's exactly why the industry was so tightly regulated, and you have things like standardized rates, requirements for rates to be displayed on the interior and exterior of every cab, the meter being visible to the rider, etc.

All this to say, any sort of competition on pricing is totally orthogonal to competition on product. Uber and Lyft handily won the product battle against cabs.

View on HN

A few weeks back there was a train outage and I couldn't get home.

Had to take a taxi for the first time in years.

I went out to the taxi spot next to the train station and asked how much € to Amsterdam etc.. Immediately another taxi driver runs up and tells me I shouldn't take this driver because he is not from the right area, apparently. Then they start shouting at each other while I, a potential customer was there. Eventually more drivers take sides and almost start fighting.

I walk away for a bit and ask another driver. I ask how much to Amsterdam he says: "how much are you willing to pay"?

What kind of question is that, ffs. It's 23:00 and I want to go home, just give me your price. He refuses a few more times and I walk away. Then he suddenly says €100. I say too much, he counters with €80. I say €60 so we agree on €70.

When we're on the highway he says his machine is broken so we have to pay cash... Goodbye reimbursement from the train company because he's also not printing a receipt.

Finally home I lay in bed thinking how god awful the entire taxi experience is when you're not using Uber.

is there no Uber in Amsterdam?

There is but my phone was out. Plus I thought: the taxis are right here, how hard can it be?

Turns out it was pretty hard.

It's below sea level, they only have Unter.

<clap emoji> * 3

> Goodbye reimbursement from the train company because he's also not printing a receipt.

He can write a receipt. Did you ask him to?

Back in my traveling consultant days, I would always ask the taxi driver for a receipt. They would (always, predictably) angrily hand me a post it pad and say "write it down yourself".

I have no sympathy for any taxi drivers anywhere.

This seems like a cartoonish example. I regularly take taxis from the airport in cities and I’ve never had anything close to a problem or bad experience.

The point is that there is absolutely nothing in the taxi system to enforce transparency or accountability. Every time you take a taxi, you are crossing your fingers and hoping that you get a good experience.

> absolutely nothing in the taxi system to enforce transparency or accountability.

Not sure about the jurisdiction GP took the taxi in, but in most places I’ve taken a cab there is a large plaque identifying the cab and driver, including contact data of the regulator to whom you can trivially submit complaints.

Ha, no way. I had similar experiences in Italy, near-melee and all.

Japan is the only place I've ever been with a consistently-sane and above-board taxi experience.

I had a Japanese taxi driver assault me with his auto-door.

Applies to all service industries in Japan, I imagine.

Huh, this feels like a third-world Taxi situation. A bit worse actually.

> Uber/Lyft did outcompete taxis on merit, and to suggest otherwise is revisionist history!

Although your point is poignant, it would be more valid if their price structure was (cough) sustainable.

What if Lyft and Uber were 25% cheaper than taxis; primarily because they didn't need to pay a dispatchers' salaries? This would be the classic case of automation lowering prices.

IMO, they could have out-competed traditional taxis without needing to price below cost; which would make your observation 100% true.

Instead, Uber and Lyft merely demonstrated that there is a market for the self-driving taxi business. Unfortunately, their relentless expansion shows the danger of letting ones' imagination run away and overestimating how quickly tech can be built. Self-driving cars is a hard problem; and building a business assuming that "AI can be delivered on a date" is a huge, huge, risk.

Clearly both companies lost the bet (that self-driving cars would work in time for their price model to work). Perhaps the Uber and Lyft stories are bad examples of the overall thesis of the article?

>Clearly both companies lost the bet (that self-driving cars would work in time for their price model to work).

Of course, the companies may have known it was a rash bet in the vein of this fable about teaching a horse to talk:

https://naomistanford.com/2009/02/09/teaching-the-horse-to-t...

Uber and Lyft could win--depending on location--based on product. But they also deeply undercut taxis on the basis of price until people got used to using them.

>What if Lyft and Uber were 25% cheaper than taxis; primarily because they didn't need to pay a dispatchers' salaries?

I'm pretty sure dispatchers are cheaper than expensive SV engineers.

> >What if Lyft and Uber were 25% cheaper than taxis; primarily because they didn't need to pay a dispatchers' salaries? >I'm pretty sure dispatchers are cheaper than expensive SV engineers.

That’s like saying paying human computer wage is less than electrical engineers who develop electronic computers.

Non-recurring engineering cost is higher BUT IT’S NON-RECURRING and largely independent of the number of users, unlike dispatchers.

How much engineer staff does Uber / lift still have on taxis? Dispatchers were 1 person low pay to 100 cabs or so.

Per SEC filings Uber has close to 4 million drivers worldwide. Even if you divide by 4 to account for part time drivers, you'd need 10k dispatchers. If their engineers make 5x as much as the dispatchers than you could have 2k engineers solely dedicated to automating dispatch and still break even.

I think they roughly have 2k engineers total and I have no idea what the breakdown is of what they do.

I'm betting dispatchers were making $30-50k. So devs make 10-20x that. But still similar math. I am just guessing at a lot of the numbers tho.

So, a much better paying job that probably doesn't suck as much. I think this is a win.

Not for dispatchers who aren't able to code.

Most people are able to code. Vast majority of people who can function as dispatchers would be mentally capable of coding.

Many people don't have the luxury of free time to learn skills like coding or the opportunity.

Taxis in many areas dramatically increased costs by artificially limiting supply to sometimes absurd levels. The obvious example is NYC where taxi medallions (a transferrable license to operate a taxi) were going for $1.4 million not long ago [1], and rapidly trending upwards. $1.4 million for a license to operate a cab is no less brokenly unsustainable than businesses running off funny money from investors, owing to "perpetually" low interests rates motivating that very behavior.

I expect some of Uber's appeal, from the perspective of investors, was predicated on a belief in the arrival of widespread full vehicle automation. If that happened, they'd have had the infrastructure, systems, and brand to immediately swap over, on a global level, and become an unbelievably profitable (and massive) company. Add in some massive scale vertical integration of maintenance and other costs, and it's hard to overstate how big they could have become. Of course it didn't happen, so instead we just got a bunch of cheap taxi rides, and that's cool. Feel bad for the medallion guys who got left holding the bag (those licenses now go for < $100k, which is a vastly more sustainable equilibrium) but at some point you've gotta trust your tulip detector.

[1] - https://www.cbsnews.com/news/how-much-is-a-nyc-taxi-medallio...

NYC had those medallion limits on purpose though, because the primary goal was limiting congestion. Manhattan is a tiny island with a small amount of road space, and taxis or Ubers roving around contribute significantly more congestion than a commuter parking their car for most of the day. And yellow cabs in effect mostly travel in Manhattan.

The sharp rise in Ubers is correlated with an 8% decrease in Manhattan traffic speeds. Which affects not only them but car commuters, bus commuters, residents, deliveries, etc. https://nyc.streetsblog.org/2015/07/22/ubers-own-data-reveal...

As with any sufficiently complex system, simple solutions fail to take into account knock on effects. As such, I'm curious about what impact that decreased traffic speed had. Did it reduce traffic deaths? Did it increase deaths in ambulances? Was it uniform or were/are there areas that are at a 50% decrease and more at 1%?

One issue I think we are seeing is that we, as tech workers, are super excited to fix the immediate problems. We have the skillset and it's really engaging! But we will often miss the forest for the trees and then double down on our solution being the solution instead of one part of the solution.

All this to say, thank you for discussing the traffic slowdown caused by increased cars. It's a side effect I hadn't been considering before.

Ironically traffic speeds in New York are measured using yellow cabs since they drive around constantly and are required to have GPS.

I think one of the biggest impacts has been on the sustainability of the transit services. For all road users, slower speeds require you to maintain more labor and vehicles out to maintain SLAs/frequencies, or to increase waits. For bus users in particular, it starts a vicious cycle because of several additional factors

* some baseline amount of people will just switch to rideshare instead of buses, reducing revenues and decreasing traffic speeds since buses are more space-efficient than cars

* with less revenues and less ridership, there is pressure to cut service to be more "efficient" at spending money

* with poorer services, more people switch to rideshare, further reducing revenues and decreasing traffic speeds

Manhattan bus ridership entered this negative spiral and fell 23% https://nyc.streetsblog.org/2017/02/21/decline-in-nyc-bus-ri...

---

Now what level of congestion is 'acceptable' is mostly based on comparing to other cities, and how the electorate is feeling. That being said, the political pressure was so strong that NYC had already implemented congestion charges on rideshare and taxis, and is currently implementing tolling in Manhattan to try and reduce car numbers. Uber actually came out in support of it. https://www.uber.com/blog/new-york/uber-supports-congestion-...

> NYC had those medallion limits on purpose though, because the primary goal was limiting congestion.

Medallion limits exist primarily to maintain and/or increase the value of existing medallions. Other reasons given were just propaganda by existing medallion owners.

NYC has bad traffic, and more cabs/ubers/etc cause traffic waiting around for fares by driving around, is hardly controversial or propaganda.

It still limited supply while the demand was way more dynamic, which Uber was able to accommodate.

The question is, do cities have an obligation to meet all supply if their residents don’t want to? People want all kinds of things that often contradict.

Now NYC is introducing congestion charging on all vehicle trips in Manhattan to try and restore traffic.

One thing I didn't see discussed anywhere in this entire thread is how impossible it was to get a cab at night (at least in Boston). On a Friday or Saturday night it was absolutely impossible to get a cab past 11:30pm. When I would rarely find one, they would ask for $50 cash to go to the destination, which would have been a $10 ride if metered. I frequently walked 5 miles home from a party at 1am. I have even heard stories of girls sleeping over at random guys apartments since it was likely safer than walking home alone. All of this completely disappeared when ride sharing appeared.

Which reinforces a point that I couldn't make above (because I had to go to a meeting)

I also wonder if Uber/Lyft pricing below cost had to do with competing with each other? IE, if all they could do was compete on price, would that (cough) force them to undercut each other? If one decided to price below cost, would the other fear that they would loose too much market share too quickly if they kept their prices sustainable?

Disclaimer: I am not an economics expert!

That may have been an experience, but it was not my experience at all. I have found taxis to just be better than Ubers/Lyfts. And yes, that includes when they were new.

I found taxis waiting in taxi stands in known locations of busy areas, or they would come if you call. If they had to come, I found them far reliable in terms of "when the vehicle would get there" than Uber or Lyft. Both of which promise arrivals and then often have to recalculate.

I found taxis to be more predictable in price. I could get a pretty accurate estimate from a taxi driver. Meanwhile, Uber and Lyft only gave you their estimate and had no problem silently charging you more. (I believe that has been fixed).

And cabs ability to take cash was great. Yes, rarely they tried "the machine is not working", but that was rare and easy to deal with like you said. Meanwhile, if you wanted to do something non-standard (e.g. make multiple stops[0]) you could, either by paying a small cash extra or because they were a person not a machine they could handle it.

Meanwhile, the reason there was so much taxi regulation was that without it traffic becomes unbearable. There would be hour long traffic jams of ubers going to pick people up near the front door whenever an event let out, as opposed to people walking to where the taxis had to pick them up.[0] But in general they are horrible for traffic.

[0] Uber/Lyft can handle that now, but could not earlier

> I found taxis waiting in taxi stands in known locations of busy areas, or they would come if you call.

I'm guessing you live in one of the top 5-10 populated cities in the US. (Or a major city outside the US).

The issue is taxis are generally fine in these area, but outside being a dense population center calling a taxi is a flip of the coin.

Taxis probably aren't great in smaller areas, and if Ubers were primarily trying to locate themselves there and compete against cars that come when you call in those areas it would probably would work fine. I have to admit my experience with taxis is less dense areas was fine, but is probably more skewed, because taxi services were optimised to take people to/from transportation hubs (e.g. airports, trains) and hotels, and that's how I used them.

However, those smaller areas don't have taxi medallions to avoid and typically have less taxi regulations in general. Obviously, there is still a dumping component where Ubers are sold at a loss, but the main concern I heard most people have with Ubers was them ignoring the various taxi regulations that made it work in dense areas. Things like horrible traffic jams caused by too many Ubers all converging on one location, refusing to pick up minorities, etc.

Edit: To clarify, since I was misunderstood. I don't mean taxis are good at picking up minorities. They, historically and through today, have not been (with some minorities). That's why there are laws that try to make it so taxis have to pick them up. That is one example of a regulation that Uber/Lyft have ignored. AFAIK, this has caused some issues with Uber drivers and no way to appeal except to hope that Uber corporate believes your story.

> refusing to pick up minorities

Have you talked to minorities about their experience with taxis?

I clearly miscommunicated and edited my post.

> Ubers all converging on one location, refusing to pick up minorities

https://www.pewresearch.org/short-reads/2016/07/25/ride-hail...

As opposed to

https://www.washingtonpost.com/posteverything/wp/2015/07/23/...

>>>refusing to pick up minorities

Taxi cab companies are infamous for avoiding entire parts of suburbia all over the US. You should spend more time outside of your urban bubble, live in middle america (or in poor LATAM, where uber exists and taxis are unsafe) for a few years, enough to realize there's an entire population underserved by existing taxi monopolies, that have been literally rescued by Uber.

> because taxi services were optimised to take people to/from transportation hubs (e.g. airports, trains) and hotels, and that's how I used them.

This is why your experience is so different from mine. If you're just using them to get around, during the day, going between major traveler landmarks (airport, hotels, tourist destinations), yes, taxis are fine.

Almost all of my taxi/Uber use is as a local. I spent way too many nights in my 20s drunkenly wandering around downtown at 2-3am trying to find a cab to get home.

Even in the biggest cities if you got 15-20m outside the downtown you were totally out of luck pre-Uber. I have many memories of "calling a cab" in south San Francisco on a friday night and pretty much being laughed at. Uber/Lyft were literally magic when they first came out and you could see your driver coming to you on a map.

Literally. Seattle was pretty okay with taxi service in 2011, but in San Francisco, the same taxi company that dropped me off in South San Francisco one day in early 2012 just told me I was on my own and they could not help me when I tried to get a ride home. No numbers for partner companies or suggestions or anything. I was stranded, and willing to pay top dollar. I could not believe the complete failure of the market just a few minutes outside the city.

San Francisco taxis were the worst. It was impossible to get a cab on Friday and Saturday nights, and they always blocked any attempts to add more cabs to the roads. I have zero sympathy for them.

I've had Taxis drive away when someone in my party said "we're going to <place in South Brooklyn>" before anyone got in the vehicle. Cabbies don't want to leave Manhattan. And for that reason you also won't find them outside Manhattan. There's the green borough cabs, but good luck finding one to flag down on a random street in Bay Ridge.

One small beef with Uber and Lyft is the vastly understated estimated pickup time at airports, LAX in particular for me.

It’s not a big deal, it’s just so silly that they made a big thing about being a “data company” but would still essentially do the bad friend thing (texting “On my way!” when you haven’t even got in the shower yet)

I read that Uber and Lyft respond with a "quick enough" time that you don't switch to the other regardless of if they have a driver assigned. Based on how they act, I believe it.

LAX is a shit show trying to get Uber in general having to take a bus to get to the Uber pick up.

I take Uber to LAX and cab home. Cabs are significantly cheaper than Uber now.

> LAX is a shit show

This and only this. I've never even had an adequate experience with that damned airport.

The airport lounges are decent - at least the Delta lounge and the Amex Centurion lounge

My wife and I don’t have cars and we travel all over the US “nomadding”. It’s a great thing no matter where we are, we can just take Uber from place A to place B anytime day or night.

I speak a little Spanish. But I couldn’t imagine trying to get around Los Cabos, Mexico for three weeks without Uber.

I liked to see you try to Uber in Western Mass.

Yeah, it's certainly not everywhere. My brother has a house near a midsize (by Maine standards) city and I could not get an Uber or Lyft when my car broke down last summer and others told me that was normal. (Not that cabs are great either.)

And they're pretty thin around where I live 50 miles outside of Boston.

So far, we’ve only done larger cities/metros

During the summer we have newspaper stories of people coming from NYC for the weekend and having their minds blown when they try to Uber.

I did see someone post on frontporchforum post that there were now a driver for either Lyft or Uber.

Your confidence in the uberness of Uber I thought should be broaden.

Well there was the one time I took Uber to the outskirts of Puerto Rico to go horseback riding and there was no service to get home and I ended up paying $200 to get back to San Juan to taxi service.

> All this to say, any sort of competition on pricing is totally orthogonal to competition on product.

I disagree. Without money-losing subsidies early Uber would have remained in the "Black Cab" market. Quality helps, but most people are not willing to pay a huge premium for it (see the race to the bottom in the airline industry).

It's also a mistake to take the large American city (New York? LA?) cab experience and project it onto the rest of the world. I live in a small-ish (< 1M) Canadian city and I've never experienced any of the listed antics when calling a cab here (and this was before Uber existed). Yet Uber still became quite dominant - probably because, for a long time, it was the cheapest option.

I’ve taken cabs in Canada (Toronto, Vancouver, Montreal, always as a tourist/business traveler) and it was exactly as described.

Now that cab companies have somewhat caught up in technology, with pay by phone and app-based booking, I’m prepared to consider them again. Price was never an issue.

Having traveled and taken cabs in many other places of the world I can confidently say Uber/Lyft/Similar apps are miles ahead in user experience than the old way. In other cities (ex. Istanbul) apps haven't quite caught on and the cab experience is much worse.

9 years ago I spent a significant amount of time in Dublin and was impressed by how the local taxi drivers integrated with Hailo. The app allowed you to call a cab from an out of the way location, you could see where the cab was, and you pay (and tip) in the app. If Yellow Cab had adopted this 10 years ago, Uber would be a cautionary tale like pets.com.

I read that Hailo ran out of money trying to expand to NYC. I lived in London when it was big and it seemed to just disappear at some point. Failing like that after becoming dominant in London is simply puzzling to me. Sounds like a license to print money once most of the cabs use it.

Yup, and they had a franchise model so just did the tech. But Uber drove them out of business by setting VC money on fire.

To say competition on pricing and product are orthogonal is to treat this like some sort of study and completely ignore the real world conditions that these businesses live in.

The salient point the author is making is these predatory pricing strategies allow these VC backed firms to capture a market, then the VCs exit and everyone else is holding the bag. It doesn't matter how good your product is if it costs more to run than it brings in it will, eventually, no longer exist. Ultimately, these companies business models absolutely did not outcompete cabs on merits alone; they had a better product that relied on predatory pricing to attract customers.

I always wondered about the elasticity of Uber prices. When I’m traveling for business, I don’t care it’s someone else’s money. When I’m on vacation, I expect to spend money. When I’m going out for drinks or just didn’t want to deal with downtown Atlanta traffic and parking when living in the burbs, I also didn’t care.

Are price conscious people using Uber?

In Prague, price conscious people are using public transport. Then I think most people have multiple apps Uber/Bolt/Liftago and before making a trip they check each for the best deal.

There's also the increased security aspect. Before you get in a car, there's a map, with both you and the driver's phones reporting GPS updates back to the mothership.

Previously my wife had an issue with a taxi in LA where she was riding with one of her friends, the friend rightly pointed out that they were in a grid section of town and the circuitous route didn't make sense, and the driver locked the doors while saying "I'll take you anywhere I please".

I've heard similar stories from many women.

This is the same Uber that keeps hiring people who rape their passengers right? Go ahead and look up Uber and sexual assault.

https://techcrunch.com/2017/12/09/uber-settles-lawsuit-with-...

You don't get the issue down to zero (and probably can't without self driving cars), but you do get the benefit of a record of where the car goes. It's not perfect, but it's markedly better than it was.

Except nobody is showing any evidence there has been an improvement, rather, everyone just says "Surely Uber does it better and does the right thing", which is absurd.

I know the women in my life feel structurally much safer. They don't have some weird attachment to the companies, but recognize that the overall system involved makes the possibility for shenanigans much less likely. There's an emergency contact button right in the app, linked to the GPS tracker.

It doesn't take a genius to see how that is safer than jumping into a random car with no record of having done so.

They're not saying "surely the ride share companies do it better"; the reasons why they think it's better are apparent to them with little trust needed.

Ah, so you think the better solution is taxi cabs, which have zero tracking, transparency, and accountability?

Every time one of those stories come out, you're forgetting that the perp is immediately caught because there's a huge paper trail detailing exactly who took what ride where and the route.

1a. The cab shows up but then picks up another person who flagged them down

1b. You have an emergency and need to cancel or the cab can't find you and the company blacklists your phone number.

Because 1b never happened with tech companies. I didn't see thebtopic hit HN front page this week so far, if that counts as proof.

The 1b that happens with tech companies is different than calling a taxi and not taking it. In this situation Uber/Lyft is still able to charge you and so they won't feel as slighted.

> [1] If you no longer need your scheduled or requested ride, feel free to cancel it. You may be charged a cancellation fee in certain conditions.

[1]: https://help.lyft.com/hc/e/all/articles/115012922687-Cancel-...

Uber blacklists people all the time for pursuing chargebacks when Uber charges a customer despite failing to provide the service. Here's an example of predatory behavior from just yesterday: https://old.reddit.com/r/UberEATS/comments/151k5hq/whats_wro...

My counter anecdotal example is that this never happened to me or anyone in my social sphere after 10 years of Uber rides, but phone number blacklisting happened to almost everyone I knew. /shrug

In SF, there really isn't "another cab company" other than Yellow Cab.

To echo the parent, they may have been unethical and borderline illegal about scooping marketshare from cab monopolies, but there were no complaints from the consumer.

...flywheel?

I use Flywheel and taxis occasionally: red lanes usable and curbside already available pickup at SFO. However, each time it's a horrendous experience.

Vehicles are bottom tier. Cab driver will always insist on just being like "What's the cross street?" (Bro use the satnav). Way more expensive.

Wasn’t flywheel a response to Uber?

I believe it was. Had a bit of controversy at the start with the guy fighting some taxi companies over it, but overall it does the job fine. The problem is that the taxis themselves suck.

1a doesn't happen if you call a "black car" service. Different service level.

1b almost never happened, because the technology didn't really exist. And there are many competing companies. And you can resolve it by actually paying for the work you made someone do.

1c. The cab decides not to take you if you're going to JFK from Manhattan on a Friday afternoon (me, too many times)

And you've never had Uber drivers cancel on you?

That's why there are regulations. In Germany, for example, cabs can't deny a ride because you look weired, you smell, your are drunk, and similar things. They are required to take any ride. The levels are very high for them to deny a ride. The punshment would be to cancel their cab license.

Cabs are even required to take kids with proper safety and to take people with disablities like wheel chairs.

They have similar laws in the US too, the problem was that cab drivers would never follow them! They are supposed to take you anywhere you need to go, but I was repeatedly refused transit because my ride was too out of the way and one time since it was too close to the airport.

Want to file a complaint? Well, then you are free to file a complaint with the taxi and limousine commission and then show up in person at an obscure location to present your case.

The amount of follow-through was approximately zero.

> All this to say, any sort of competition on pricing is totally orthogonal to competition on product.

I've visited the US on a few occasions, and each time I've used Uber or Lyft for precisely the reasons you state. I could bring up the app, enter my destination and get a price and an ETA. Either I liked what I saw or I didn't, and I could make my choice.

Back here in Oslo, Norway, every now and then I take a cab home after being out all night. Uber and friends don't exist here because laws and regulations. And it sucks. Even as a local they try to take detours, and who knows how much it'll cost to get home this time.

>>:All this to say, any sort of competition on pricing is totally orthogonal to competition on product. Uber and Lyft handily won the product battle against cabs.

Pricing may be orthogonal to product, but both are needed profitability. You gotta have something people want AND make a profit.

If VC has showed us anything, it’s that you don’t have to be cash flow positive. You just have to present the illusion that you just might be one day long enough to cash out.

The real people being scammed by all this are secondary investors and pension funds.

>The real people being scammed by all this are secondary investors and pension funds.

No, it's the real, legitimate businesses and employees that are in the space being """disrupted""" and lose their shirts and jobs because it's impossible for a legitimate business to compete with selling one dollar for fifty cents.

Add to that all the normal people who liked using those businesses and liked how small they were and were perfectly happy and now are stuck using a shitty evil megacorp

There’s nothing inherently evil about large corporations and there’s no inherent right to a business model in the face of undercutting competition.

Just relax and enjoy the subsidized rides and grocery deliveries while it lasts.

> There’s nothing inherently evil about large corporations

The post you're replying to was specifically referring to the megacorps involved in the disruption and predatory pricing. They never said there was anything inherently evil about large corporations.

That said, I do agree with your prior comment:

> The real people being scammed by all this are secondary investors and pension funds.

Not exclusively, of course. You've both identified valid sets of victims.

I don't know what I was thinking. I should have said and also rather than "no"

> Uber/Lyft did outcompete taxis on merit, and to suggest otherwise is revisionist history

> People talk about how Uber/Lyft dodged taxi regulation, which is true

Taxis sucked (and still do), but Uber/Lyft's not-so-secret sauce was regulatory evasion, claiming that their taxi service wasn't a taxi service and that their employees weren't employees.

Also Uber/Lyft were "dumping" their product, selling rides below cost by partially funding every ride with VC investment money.

This made their product artificially competitive.

I always see people say this but I don't know how they were subsidizing rides. I was an early Uber driver when I was in grad school and I received roughly 2/3rds of what riders paid. Was Uber's third take too low?

I would also receive a lower fare when the rider used a coupon or had a promotion. It always seemed more like I was subsidizing the rides rather than Uber.

Maybe, just maybe, your singular experience is not accurately representative of Uber's business? You can go look up how they were clearly subsidizing fares.

Right—I'm sure they won some business because they were actually a better experience in some ways, but I've ridden in like three taxis ever in my nearly 40 years on this planet, and never in the place where I live, but have taken probably thirty or forty ubers/lyfts, most of them near home. Why? Taxis were too expensive, so I never even considered them an option. Ubers and Lyfts were stupid-cheap for a long time.

Another big impact of Uber/Lyft was safety of getting around in poorer foreign countries, particularly ones where you don't speak the language. It's much more safe and consistent to take an Uber at night in Colombia as a foreigner

Yes but that same service can be provided by taxi+website, which exists and functions acceptably in some places (Rome, Paris).

> Uber/Lyft did outcompete taxis on merit, and to suggest otherwise is revisionist history!

That is a very generous version of what actually happened. Uber/Lyft were not replacing taxis outside a few big cities with established taxis operations, they were replacing consumer behavior entirely. It was near impossible for them to charge market rates and get a user base that had no need for taxis. If they weren’t heavily subsidizing the rides, they would have never been successful. They most definitely were charging next to nothing when they were in “growth phase”. At the height of it, it was almost as cheap as public transportation and not market rate.

Oh wow, I didn’t know you could say that. I should have told the taxi driver this when he said my card was declined (the reader was broken, so he had to use his phone with the Square dongle). I ended up having to use my other (debit) card, which annoyed me a lot… Paying cash was not an option, since I needed a receipt. He didn’t even have a printer, so I had to enter my email, which annoyed me even more. This was from Orlando airport to a hotel ($65 wo/tip)… going back I went with Lyft and it cost ($42 incl tip) and there is no problem paying.

That's just a scam.

My first job was working on payment systems in taxis. The biggest issue we had? Taxi drivers ripping them out so they can charge cash.

I'm 20years out of the taxi industry but I wish Uber and Lyft would kill that industry completely. It's what I call a scam industry. Like car dealerships the entire industry is focused on squeezing every dollar they can from every transaction. It's horrendous. I also can't believe anyone would defend taxis here. Naivety I assume.

> 1. Stand on a street corner (if you're in a busy area) or make a call if you're not. If you have to make a call, there's a ~20% chance a taxi actually shows up.

option 3 - go to a hotel, and have them call a cab for you, or get one from the stand there. This is my go to for cities I'm unfamiliar with, and it's never let me down. The taxi companies might not have an incentive to show up promptly for _you_, random person calling them, but they do for the hotel in their area.

> Uber/Lyft did outcompete taxis on merit, and to suggest otherwise is revisionist history!

Uber's predatory and illegal practices are pretty well documented. It's not revisionist to say that without deliberately putting their thumb on the scale, Uber would not have even been able to get into the market.

> Uber/Lyft did outcompete taxis on merit, and to suggest otherwise is revisionist history!

You're right about downsides of cabs, but I'm afraid you are also revising history on the issue of merit.

For a long time, Uber (and Lyft) rides cost a lot more than clients were paying - many people noticed this and wrote about it, and the edgier ones characterized ride-sharing as a wealth transfer from VCs to riders.

The setup was clearly not "competing on merit" and was closer to predatory pricing. It's obvious the investors would have demanded massive hikes had they managed to drive competitors out of business.

One of the things that's interesting here is what's the fundamental difference between using your phone to order a cab using your voice, and using your phone to order a cab with your fingers ( an app ).

Pricing mechanisms could be the same - pre-agreed price etc.

The real key difference is the realtime feedback of where the cab is in terms of coming to pick you up. ie the diminishing of the anxiety of that uncertain wait.

That's it - that's the only thing traditional cab firms couldn't provide - and now many of them now have their own apps - as apps aren't that hard.

Don't underestimate how much some people dislike talking on the phone.

Before ride-sharing apps, the process for getting a taxi was:

Also...

Step 0: Don't be black

Well, location and (aparently) attitude of workers/service providers does matter. If I call a taxi, it arrives with a 99.9% probability. And it usually takes around 5 minutes to arrive. In fact, fiddling with an app to order a taxi would be more time consuming then the 10 second phone call. IOW, if you have working infrastructure, Uber isn't even a competitor.

NYC is the only city I've found that seems to be good at #2 and #3. #2 because route finding is generally pretty easy to follow so scamming people is harder. #3 has been much much better since its been made illegal to get to the destination and then reveal that the card reader is broken.

(I'm sure there are other cities that get it right, but they're hard to find in the US).

> Uber/Lyft did outcompete taxis on merit, and to suggest otherwise is revisionist history!

quite correct!

The Uber/Lyft "package", as it were, is easily worth a full 20% over conventional taxi systems circa 2010ish.

Since using Lyft, I have since only used traditional taxis when Lyft/Uber was not available. Because the old model was bad.

What is this crap people in the valley have to say about taxis? That's a problem with where you live, not with taxis. Taxis everywhere I've lived have always been fine, safe, clean, boring, and the prices aren't great, but neither is uber--they seem on par where I live

Except taxi drivers get paid enough to raise a family

I dunno where you live, but every time I used a taxi in different countries I was unhappy.

There's no way this is a valley thing. I've had mostly terrible taxi experiences across the UK. The exception being advanced airport rides, where they are paid more for the ride and the cost is fixed. Two taxies in a row at the train station recently said their meter wasn't working and it's cash only.

I live on the east coast. A decade ago driving nights for Uber across three different cities and picking up passengers from all over the country, half the people I picked up wanted to tell me their taxi horror stories. Your experience is the exception.

I agree. In my area, taxis were never bad at all, and Uber/Lyft was not much of an improvement. Uber/Lyft got a foothold here purely because they were cheaper.

Taxis are globally well known for being terrible and scammy, especially from airports.

You forgot to mention that even if you call a cab, and even if it shows up, someone else can just take it. The one time I tried taking a cab, we called and ordered one, waited outside, and then watched as it picked up a group of people up the street and drove away.

Dodging regulation, aka cheating, disqualifies a party from a competition. And today we have rideshare drivers refusing to drive into bad neighborhoods just like cabbies did before regulation - consumers are worse off in that example and there are others.

Everything you’re mentioning happened due to the invention of the smartphone, a nearly perfect ride hailing device with GPS and payment ability included.

It’s like saying Netflix invented streaming video.

This just reminded me of a trip to Italy I took back in 2009. There was this taxi I took that charged me 100 Euros to go a kilometer.

Never again will I do that.

Right... So the regulations exist to prevent exploitative behavior from unscrupulous drivers... like Uber's innovative idea of surge pricing?

You know the surge price before you even order the Uber, and if you want you can decide that you'd rather roll the dice with a taxi.

Uber and Lift don't pay drivers nearly enough to afford regular vehicle maintenance. I trust a taxi company's fleet maintenance 1000% more.

I think part of the problem is tipping. Remember how Uber used to say tips weren’t necessary and then they decided to encourage tipping so that they could pay drivers less. The problem is a huge chunk of users don’t bother tips. I tried driving Uber/Lift for a couple days in 2019 to see if I could make extra money and noticed that the majority of my fares were just people going to their job at Burger King and I’d make like 4 bucks for that and no tip. And I wouldn’t really expect people using Uber as transportation for their low wage job to be tipping much but it just showed me that the whole system was pretty broken.

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