The Under Uber

Things are really reaching a crescendo in the rock-n-roll world of Uber.

Given that there are almost as many people writing about it as there are driving "for" Uber, I don't anticipate serving up anything of shock value here.

In fact, it's more about the opposite. Is there anything shocking about Uber, really? What is happening that we didn't think was more "would" than just "could"?

Many bar-side conversations involve the enduring mystery of how investors are gonna get their money back, but I always had the nagging feeling that the money pot is more like primordial soup than it is like bridge scaffolding, and anyone who put more money into Uber than I have ever seen in a briefcase on a tv show deserves to be told that they moved into the house and now they have to live in it; no resale.

Of far more importance, I think, is the basic dynamic underlying the whole thing's buzzy facade, in which the fundamental need to convert an asset into a payoff (aka, a "business") is neither new nor friendly.

The main situation at hand is that drivers and Uber have competing interests. In fact, they each have a stake in the same varieties of constraints, but they don't necessarily have a compatible position in enough of them. The way that Uber would make a profit is by managing the constraints that sit between the asset and the benefit. Each constraint is a situation in which the potential eventual value of having the asset is at risk of being decreased.

But the same thing is true of the drivers; it's just that the drivers have a different asset to begin with, and a different target benefit. Drivers can drive because it is convenient for them. Drivers are motivated to drive because as a commitment to work, it provides a higher sense of personal independence.

At this point it's worth noticing that the business is not about riders sharing rides. It's about the company and the drivers sharing cars. In that sharing, examples of actions on the competing interests are as follows. Presumably these very common concerns would be put to reconciliations of interests. Reconciliation changes the constraint into a factor (either risk factor or success factor) of business value. But the key note is that the conflict in any issue is lopsided in favor of the company, otherwise the company cannot make a profit:

And from there, because of the promise versus the reality of reconciliations, we get the endless variation of details between cities, times of day, gender, and marketed service levels -- but also the drama, the aggressive policies, the tech lust, the litigations, the debates, and in general the friction between interest holders that turns the whole flow from asset to payoff into one long raw nerve.

Since the car-share company has much more authority than do the drivers, the more the company presses its will on the nerve, the more likely it will foster a negative consequence for the drivers.

This is especially true, say the media and driver anecdotes, where women are concerned. The concerns are, of course, being treated fairly, safely, and supportively. While the "community" of women drivers and passengers seems to have formed a consensus that Uber is not their best option, the newest headlines suggest a more thoroughly cultural neglect -- of how the system of squeezing company benefit from its relentless consumption of drivers leaves women in management, administration or operations also excessively vulnerable. Those areas have a lot of work to cover:

What is left unresolved without a scientific investigation is whether the system is significantly hostile to women because of the managers within its structure; or, could the system even perform for profit under different managers, while also reconciling the inherent competition between drivers and the company, with an outcome favorable to women instead of unfavorable.

Today, the circumstantial evidence is that groups of managers with investment funding think that a different mode, not a repair of Uber's model, is required to make the business friendly to women. Lyft may be most like Uber, but apparently not to women. Otherwise, new ride on-demand companies sprout, and try to expand or die trying, largely by estimating how much value there is created by avoiding Uber's problems. We already know that their P.R. travels across city and state lines far more efficiently than does their operations. But those alternatives, and their investors, will soon enough have to deal with a bigger issue: as the core operations of the business come to rely more on automation than on people, car-sharing moves away from dependency on drivers, anyway. What the business really wants, in order to pay off its investors, is auto-mobiles, not drivers.

That realization pulls the whole show out of the over-hyped ideas of "the gig economy" if less so "the sharing economy". But if the somewhat near future of auto-mobiles requires a human attendant in the vehicles, then the labor pricing and economy shift to other services, from in-car programming and reconfiguration to concierge duty to licensed mobile social service. All of those will be premiums on top of the ride-for-fee.

It's an odd thought, but maybe the situation boils down to this: Uber doesn't want to have the problems it has now, mostly because it doesn't know how to solve them. But it needs these problems now, because it needs to do what it is doing now in order to get to where it wants to be. And, it needs to simply outlast those problems, not solve them. The investors get their money back when these problems have been made unnecessary.

Drivers? It always comes down to whether or not they actually have something better to do with their time.

(c) 2017 malcolm ryder / archestra research