9 votes

What free, ad-supported Uber rides might look like. Mockups, economics, and analysis.

8 comments

  1. [2]
    rkcr
    Link
    That is quite the bold statement to lead an article with! I would take the rest of it seriously if there were any evidence of this actually happening; instead recent news has indicated the...

    Free, ad-supported Uber rides are inevitable

    That is quite the bold statement to lead an article with! I would take the rest of it seriously if there were any evidence of this actually happening; instead recent news has indicated the opposite has been occurring. Also, Uber just this month reported their first quarter with any profit whatsoever.

    It seems like this is an over-extrapolation error. Just because prices can fall (when you carpool) doesn't mean that prices can go to zero.

    10 votes
    1. Adys
      Link Parent
      I completely agree. I think the author is a bit delusional, but the economics of the article is why I posted it; it offers some neat insights into how this would work, as a thought experiment.

      I completely agree. I think the author is a bit delusional, but the economics of the article is why I posted it; it offers some neat insights into how this would work, as a thought experiment.

      3 votes
  2. [4]
    Bullmaestro
    (edited )
    Link
    Won't happen. Taxi rides are expensive due to labour, fuel and maintenance requirements. Self-driving and electric vehicles can mitigate this to some extent but the technology is still many years...

    Won't happen.

    Taxi rides are expensive due to labour, fuel and maintenance requirements. Self-driving and electric vehicles can mitigate this to some extent but the technology is still many years and many regulatory hurdles away from becoming a reality. Chen is delusional for thinking advertisers will pay the equivalent of £10 - £20 to advertise to individual or small groups of passengers. Even then, if it's implemented as a system to discount fares with ads, I think passengers would rather stomach the extra fare than be served the same shitty mobile game ads on their device for twenty minutes straight.

    Public transport is expensive as fuck, even though they have plenty of space to plaster advertisements everywhere and already do plaster ads all across the interior and exterior of their vehicles.

    Uber are falling out of favour here in the UK to competing apps like Ola or local taxi services. Many have complaints of waiting long times to a driver to accept their request for a ride. I've definitely had this problem before. Also, I've noticed that ever since the past two years, drivers will rarely if ever rate you as a passenger. I've used the service about a dozen times over the past year, yet my Uber rating (4.51, which is kinda low) hasn't budged.

    I originally thought my inability to get rides via Uber was an issue with my Uber rating, but apparently friends with much higher ratings have had similar problems hailing Uber cabs.

    Stating this because Uber isn't in danger of failing to some venture capitalist's pipe dream of free, ad-funded taxi rides but rather a superior service.

    I remember when me and my brother returned from holiday. It took us 3 attempts to finally book an Uber home from the airport.


    EDIT: Here's an idea for an app/service that could disrupt the transport industry.

    A buspooling app where passengers can hail a ride via an app then be picked up and dropped off by a minibus, single-decker or double-decker bus along a generated route based on what other passengers have requested. They pay automatically for the fare via their app. Essentially... remove the issue of dedicated bus routes and bus stops via algorithms.

    Perhaps the app would use similar camera recognition technology to Amazon's Stores in case somebody overstays their welcome on the bus.

    It's one of those ideas that I think only a big tech firm can really do, because of the sheer initial start-up costs of getting a fleet of buses together.

    6 votes
    1. jzimbel
      (edited )
      Link Parent
      Your idea has been attempted several times and is still being attempted frequently by various startups—it really isn’t feasible from a profitability perspective. One example (Wiki) However, some...

      Your idea has been attempted several times and is still being attempted frequently by various startups—it really isn’t feasible from a profitability perspective. One example (Wiki)

      However, some form of this is offered by most public transit authorities, as a public good, at a net financial loss. For example, the MBTA’s “The RIDE” paratransit service. It’s relatively expensive for users, even with substantial support by state/city subsidies.

      Municipal public transit is near-impossible to make profitable (EDIT: as a direct consumer-facing service—it can be profitable if the company positions itself as a software vendor to public agencies, thereby indirectly benefiting from taxes and subsidies) because our built environment allows the people who would most likely have enough money to put into it, to avoid it completely by using private transport instead. Those who are willing to drop more money on a ride-hailing service are willing to do so mainly because:

      1. They get a direct trip from their origin to their destination with no stops along the way
      2. They don’t have to share space with strangers (besides the driver)
      3. The pickup wait time is usually under 10 minutes, so users don’t need to plan ahead at all

      An on-demand bus/vanpooling service with algorithmically-generated routes offers none of these, which makes relatively wealthy non-car-owners much less interested in using it.

      (Full disclosure: I work at a public transit authority so I might be slightly biased 😉)

      4 votes
    2. [2]
      babypuncher
      Link Parent
      Isn't public transit dirt cheap in most places? Whenever I visit NYC I can get from one side of manhattan to the other for a fraction of the cost of a taxi or uber.

      Public transport is expensive as fuck, even though they have plenty of space to plaster advertisements everywhere and already do plaster ads all across the interior and exterior of their vehicles.

      Isn't public transit dirt cheap in most places? Whenever I visit NYC I can get from one side of manhattan to the other for a fraction of the cost of a taxi or uber.

      1. MimicSquid
        Link Parent
        That's the cost to you at time of use, but Bullmaestro is talking about total cost to operate the service, which is mostly funded publicly (which is to say, through your taxes,) and does really...

        That's the cost to you at time of use, but Bullmaestro is talking about total cost to operate the service, which is mostly funded publicly (which is to say, through your taxes,) and does really add up. It's very worthwhile, in so many ways, but it's not cheap. Well, not if it's done well.

        6 votes
  3. Shahriar
    Link
    Great analysis, however, the author should have placed this disclosure for their conflict of interest: Read a lot like an investment op-ed with a looking forward statement towards the end.

    Great analysis, however, the author should have placed this disclosure for their conflict of interest:

    Previously, he led Rider Growth at Uber, advised/invested in dozens of startups, and has been writing for over a decade. He resides in San Francisco Bay Area

    Read a lot like an investment op-ed with a looking forward statement towards the end.

    5 votes
  4. BlindCarpenter
    Link
    watching enough ads to generate enough ad revenue to pay for a ride in an uber sounds like a minor subplot in a dystopian hellscape sci-fi movie.

    watching enough ads to generate enough ad revenue to pay for a ride in an uber sounds like a minor subplot in a dystopian hellscape sci-fi movie.

    4 votes