Uber's value is this:<p>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).<p>2. I can get a car somewhere other than downtown.<p>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.<p>4. No silly medallion limits, so I never need to wait for long, even at closing time.<p>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.
Uber definitely has some advantages vis-a-vis competitors, because there is a brand and networking effect at play.<p>Everyone knows about Uber, nobody knows anything about that 'local startup'.<p>The real competitor is obviously regular cabs. There is always a cab when I need one in Montreal, I don't care about Uber really.<p>The bit about 'regional profitiability' is valid. I'm suspicious that Uber is running profitably in the US. That said, I'll bet the absolutely could if they wanted to ... but they spend a lot on aggressive tactics/marketing.<p>If they had to 'stop growth' and 'just be a US' company right now - they'd have to lay off, downround etc.. Sure - they'd have screwed over later investors, but that's the point no?<p>The loser in all of this is the later stage dumb money. Mostly everyone else wins.
The real question is whether Uber can ever make money without subsidizing rides with investor capital. At some point, they have to raise prices. This make them vulnerable to competition.<p>The good news is that if Uber goes under, it's easy to replace them. Uber and Lyft pulled out of Austin TX last May over required fingerprinting of drivers. Ten competitors sprang up to replace Uber and Lyft. They're doing fine.[1]<p>[1] <a href="http://www.curbed.com/2016/12/7/13828514/uber-lyft-ride-austin-rideshare-get-me" rel="nofollow">http://www.curbed.com/2016/12/7/13828514/uber-lyft-ride-aust...</a>
Reminds me of Facebook six years back: "There's no way they're worth $33B" [1]. Now they're worth 10X, publicly traded, and printing money. Respectfully, even professional prognosticators (ie. VCs) get this shit wrong 9 times out of 10... so lamenting all the ways it could "fail to be a great business" isn't really that insightful (in the probabilistic priors sense).<p>TL;DR: You could be right (and frequently will be), and you could be spectacularly wrong. But we're just Monday-quarterbacking while they're trying to make the future bad-ass with magical "autonomous" cars (whether human drivers or computerized). That's cool in my book; I wish them the best of luck!<p>[1] <a href="https://signalvnoise.com/posts/2585-facebook-is-not-worth-33000000000" rel="nofollow">https://signalvnoise.com/posts/2585-facebook-is-not-worth-33...</a>
Uber is overvalued.<p>It's not rocket science, easily copied, little customer loyalty and consumers will switch quickly to whoever offers the better and cheaper service.<p>The end game here is autonomous vehicles and I'm not sure they are even in the game.
The BBC ran an interesting article the other day asking if Uber were getting too big to fail, pointing to the way state-subsidised Uber is replacing public transport in some areas and worrying about what their lack of profitability means for this: <a href="http://www.bbc.co.uk/news/technology-38252405" rel="nofollow">http://www.bbc.co.uk/news/technology-38252405</a>