Originally published at: http://boingboing.net/2017/06/21/ceo-travis-kalanik-forced-out.html
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“I love Uber more than anything in the world"
Well - there’s your problem.
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It appears to be an abusive kind of love.
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Progress, of a sort. Now the fish will rot downward from a hedge funder/VC head rather than an Ayn Rand fanboi head.
[In regard to the company’s shaky and unsustainable business model, here’s a link to the start of a long multi-part read at Naked Capitalism]
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I love Uber more than anything in the world
Kicks just keep getting harder to find.
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Maybe a little too on the nose, but god it feels like you could swap America in for Uber right now…And tie this to the “forcing Trump out won’t solve the real problem” thread and the parallels become all too real…
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Once the investors fired Bernie Madoff, his investment vehicle became profitable and everyone was happy, right?
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That’s pretty much how it feels. We’re only a thin fog of bravado away from total collapse.
Yesterday I was walking with my son through an old neighborhood that is mostly houses built for employees of the adjacent textile mill. The textile mill has been converted into shops that sell products manufactured in Asia, and the 1000 sq ft. mill houses sell for $300K or more. My son was amazed that a factory would build houses for its employees.
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It’s not like the mill built the houses out of the kindness of their heart. The employees were probably heavily indebted to the Company for the housing, as well as everything they purchased at the Company Store. At the very least, they were a captive audience for the Company.
Anyway, I heard an interview with the CEO of Lyft a couple weeks ago on Marketplace, and the interviewer seemed to be digging at him for his slow and methodical approach to expansion. It seems like Lyft will come out ahead in this one, unless Uber can go in a different direction now that Kalanick is gone. I wonder what leverage the board used to force him out.
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This ‘shaky and unsustainable business model’ can be changed easily. As a driver (as well as someone that makes good money at his day job … probably makes more than most of the people I give rides to) – it is easy to see where the problems are. They spent a lot of money early on paying off lawsuits (and will probably have to do more now that they are admitting to the flaws…though may go directly after the folks responsible now that they’ve removed them). They screw over drivers UNNECESSARILY. They screw over passengers UNNECESSARILY. And they’ve wasted money on trying to be the next Tesla with autopilot (I know this is the wrong term, but its what people think this term means).
They are spending BILLIONS on trying to figure out how not to pay drivers.
The rest? They really have little overhead. They have a twitter that connects the nearest person pressing a button to the nearest person driving. Beyond this, the only things they need to worry about are customer service.
The unsustainable aspects of the company come down to trying to get ahead of the curve that is coming in 20 years. And treating their best drivers like shit thinking that they won’t need them in 20 years anyways. Without thinking of the decades that will happen before this happens.
They’ve started to treat drivers right – we got emails stating that they are changing several things that Kalanick REFUSED to change because he thought more of his bank account than drivers. They had 3 updates and promised for the next 6 months, they will be giving far more MAJOR changes to right the boat with us.
Who knows. Maybe they will do it. Their model isn’t that bad – and it certainly beats the days of cabs.
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In the end, as with many Silicon Valley businesses, Uber’s business model is really based on constant over-valuation of shares. A handful of those businesses will be able to kick the can down the road and keep the hype machine going long enough to approach the valuation. I’m not convinced Uber will end up in that handful.
I agree that disruption of the medallion monopolies was definitely needed – the cab companies were too fat and complacent to put together a proper ride-hailing app of their own, which would have saved them a lot of grief. That doesn’t mean that Uber’s approach under the former CEO wasn’t going to end up in a similar place of exploitation and aspiration to monopoly status.
I don’t know if that much is going to change now that John Galt Kalanick is out, since hedge fund managers and VCs don’t have a lot more sympathy than he did for drivers like yourself, but improvements are improvements and treating labour right is one aspect of that. And in the end the low overhead you describe, based on commodity software like messaging and GPS, means that the operations model is fairly easily replicated, especially in local and overseas markets.
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M o n e y.
I’m always torn about Uber when I travel. On the one hand I detest their business practices and how they treat drivers and customers but on the other, their service is really the only one that works in certain places - like Mexico City or other S. American cities where regular taxi service is extremely unreliable or even risky.
It’s kind of like how I feel about Walmart - I do everything I can to avoid shopping there but sometimes you need racquetballs at 3am and there’s just no where else to go.
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The olden days were a worker’s paradise. Everyone knows this.
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The NYT link is broken.
of course, back when america was great. let’s make it that way again!
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I wonder if they’ve considered expanding into pharmaceuticals?
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Unfortunately, he’s one of those people who works tirelessly to turn his problems into as many peoples’ problems as possible. And that, at least, he is fairly good at.
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I haven’t been in DF in over ten years but taxis were plentiful, and reliable when I was there, this may have changed but I’m pretty sure Mexico being in North America hasn’t!
Is this not a regulatory issue? Here in Ireland you have to sit an exam to be a taxi driver, get a licence, insurance, and have a decent quality vehicle inspected. It costs a couple of hundred euro I think and you get a number and an ID badge. You can then sign up with an app if you like (and most drivers love the apps). You can even sign up with Uber (though that is really rare - I think it’s just for the airport run as some tourists/tech workers would be clueless enough not to just get the taxis on the rank which are plentiful, reliable, not expensive, or the bus either the expensive airport bus for tourists or just the regular bus to the city centre for backpacker types).
What the actual fuck does Uber do that’s worth their market value?
Two issues: app company consolidation is happening and there is emerging one app to rule them all. I believe from the taxis that it’s Europe wide and while they don’t mind I think that’s a significant worry. And of course Uber has their European headquarters here despite not having any drivers. Because of course they are laundering their money here because of course.
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It is. The problem in many large American cities is that the kind of sensible regulations you mentioned also included limits the number of medallions that were required to operate a taxi. Over time this false scarcity was used by a handful of wealthy incumbent corporations in cities like NYC to monopolise the market, creating exploitative conditions for drivers, poor service for customers, and the complacent attitude that led to not developing ride-hailing apps.
As a result, a single taxi medallion in NYC goes for more than USD$1-million, and the monopoly companies lobby municipal governments heavily to maintain the false scarcity under the guise of supporting the other standards.
Uber may not be (and isn’t, IMO) worth its market value, but one thing it did do was give the medallion monopolists a kick in the arse and give drivers more (but not much better) options and provide more convenience for passengers.
