Blog post 8

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Rider University *

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MISC

Subject

Management

Date

Feb 20, 2024

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pdf

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Uploaded by DeanRook13084

1. After listening to the lecture do you still think of the Uber business model in the same way? For instance, is the technology – – the app that creates the two-sided market – – really the disruptive innovation? Or is it, as the lecture suggests, a business model designed around poor wage levels, subsidies through venture capital that gave out huge discounts to passengers and drivers to grab market share and an utter disregard for rules (which now results in huge settlements with governments)? In short, reevaluate the business model. After listening to the lecture, my perception of the Uber business model has certainly changed. Initially, I viewed the technology behind Uber's app as a disruptive innovation that revolutionized the transportation industry. However, the lecture shed light on several aspects of Uber's business model that made me reevaluate my stance. The lecture suggested that Uber's success was not solely due to its innovative technology but rather a result of various other factors. One such factor is the company's deliberate design around poor wage levels for its drivers. By keeping wages low, Uber was able to offer competitive prices to passengers while maximizing their own profits. Additionally, it became apparent that Uber relied heavily on subsidies through venture capital in order to offer huge discounts to both passengers and drivers. This strategy aimed at capturing a significant market share and outcompeting traditional taxi services. Considering these revelations, it is clear that the technology itself may not be the true disruptive innovation in Uber's business model. Instead, it seems that their success also stems from a combination of strategic pricing, venture capital subsidies, and a willingness to operate outside established rules. 2. Is Uber sustainable? The company Uber has revolutionized the transportation industry with its innovative business model. However, concerns have been raised about its sustainability. One key factor is the company's heavy reliance on drivers who are not classified as employees, leading to legal battles and potential labor issues. Additionally, Uber faces fierce competition from other ride-sharing platforms, such as Lyft and other traditional taxi services. Moreover, the company's profitability remains uncertain due to its high operational costs and ongoing investments in autonomous vehicles. While Uber has undoubtedly disrupted the market, its long-term sustainability hinges on addressing these challenges and adapting to an ever-changing landscape so that the company can maintain its dominance in its industry.

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