I really want to agree with the GP post — it’s the classic business school formulation after all — but you are right.
The nuance I would add is that to the end user Uber is an alternative to a taxi (fits the ecological niche better for the wealthy customers). However your formulation is correct for the drivers, and most importantly for the investors. It has an economy of scale that taxi companies done.
And there’s the “for the wealthy customers” part: taxis have to serve pretty much everyone by law in most places. Uber drivers are free to not pick up customers in neighborhoods they don’t want to. Which is why I can get an Uber at 4 am in Palo Alto but not in Queens.
No it's not. The user communicates with Uber. The driver communicates with Uber. Uber matches the two. Uber charges the user for the fare. There is not even a little bit of peer to peer activity going on.
basch|7 years ago
gumby|7 years ago
The nuance I would add is that to the end user Uber is an alternative to a taxi (fits the ecological niche better for the wealthy customers). However your formulation is correct for the drivers, and most importantly for the investors. It has an economy of scale that taxi companies done.
And there’s the “for the wealthy customers” part: taxis have to serve pretty much everyone by law in most places. Uber drivers are free to not pick up customers in neighborhoods they don’t want to. Which is why I can get an Uber at 4 am in Palo Alto but not in Queens.
shanghaiaway|7 years ago