Walking Boot said:
Abraham said:
One of the things many people don't realize is that Uber's sky high valuation is about driverless cars. They are trying to build a brand where the idea of clicking a button, entering a destination, and getting in whatever car shows up is ubiquitous. Introduce self driving cars and there are no driver costs, only maintenance and logistics costs. Thats the 40 billion dollar company.
The only problem is they don't own a fleet of cars, have Google's self driving tech, or the infrastructure or logistics (they rely on their drivers to figure it all out).
All they have is the brand.
The bidding for Nokia maps business has been insane for this reason.
Also. Don't underestimate the brand. Most tech companies own very little "stuff" . AirBNB, Dropbox. Facebook, spotify, Netflix, Twitter, Amazon. These companies own very little of what they make money from
Those are vastly different types of business than what the driverless cars world is going to be. Don't get me wrong, I'm eagerly awaiting the future world that it's going to bring, but, the realities of it are going to be really tough. There are some high barriers and I don't see how Uber gets around it the way you're talking. They're going to need physical cars somehow, they can't just be a middle-man business in this space. And it's not going to be quick, we're still far away from making it a reality, much farther than people realize.
Sometimes I think people are looking at the driverless cars problem the way Marvin Minsky thought about computer vision, just give it a summer and it'll be solved. It's a really tough problem, computationally and logistically.
I think Google, owning at least part of the puzzle, stands a bit better in this space. I mean, it's just my opinion, I don't have a crystal ball, but I've been following the driverless cars world for years now, from before Stanley won the race, and the vision I have of how it works doesn't seem to fit with where Uber is positioning.
I think my basic issue is this:
The legislation can go one of two ways. What they're talking about now, is that driverless cars will be permitted on highways only, but once you get on surface streets, you need a human behind the wheel operating the vehicle fully and making all decisions. Now, it may start that way and it may run that way for a decade or so, but maybe someday the tech gets far enough along that they change the law and you can go driverless on surface streets as well... a fully driverless experience door-to-door. Or maybe the tech gets there sooner and the driverless world starts out that way. Either one is problematic...
1) Driverless on highways only... a person behind the wheel can operate their Uber-car, sure, but how does Uber get the car to them at the start without their network of human drivers? What's really different in this world? Not much. It's a driverless car but you have to carry an extra driver? Seems impractical.
2) the fully driverless world... this would seemingly be the dream scenario if it ever happens (decades from today, if ever, it seems), but, it's got some pitfalls. First, driverless tech is expensive to install. Not many people will be upgrading their old-school car to driverless due to the prohibitive cost. So it'll be lots of cars built from the start to run fully driverless. Great, but, then where does Uber get these cars? The whole thing about driverless tech is that once it's in place, the individual does not need to own the vehicle himself. So the Uber Drivers out there disappear, the individual car owners that Uber builds on vanishes. Right now the average car sits idle 95% of the time. Once "fully driverless" comes into being, there's no point to owning your own car. You'll call upon some service and have the car sent to you, use it for however long, and then it goes away to serve someone else. That's the Uber scenario in general... but the car has to come from somewhere, and it's not going to be a network of Uber Drivers with their own individual cars renting them out to Uber on the side. The cost to enter is too high. Instead I envision some kind of fleet ownership operation. Some company with a lot of self driving cars specially built. The individual owner scenario I don't see happening. Is Uber's valuation high enough they can just buy fleets of vehicles to cover entire states and still turn a profit? That's the part I'm not seeing. It's like "What would happen to Uber if
everyone got rid of their car, and used Uber instead?" Well, they'd have no drivers, right? If Google & Ford teamed up to put out a fleet of fully driverless golf carts, then that world I can see happening. Something about Uber's model I don't quite get, today, as a reason to value them so highly in a future that's so far away. Paying for that, now, seems an ill-advised investment.
And, yeah, there's a "brand" there, but their name isn't that good right now. I could see them sliding down farther as more negative stories come out.
Anyway, the current valuation may be more to do with laws being changed and taxi consortiums challenged than by a vision of the driverless world of 2050 or beyond.