Uber is planning to raise up to $1 billion in new investment, only months after having raised the same amount. As Natasha Lomas observes, this raises an important question:
Why does a ride-hailing business that likes to claim it’s not a transportation company need such a massive money mountain behind it? It’s pretty clear Uber subsidizes the cost of rides as part of its market expansion acceleration strategy — as a way to undercut traditional taxi opposition and put pressure on local ride-hailing competition.
It’s also been spending big on trying to crack specific international markets, such as the Chinese market, where it faces some fast growing (and well funded) local competition — raising around $1.2 billion last month to fuel its growth there, and another $1 billion in July focused on India.
The company has also signaled its ambitions go beyond getting people from A to B, with merchant delivery programs, such as food delivery (Uber Eats) and a same-day courier service (Uber Rush), being piloted and soft launched in various cities.
It’s also engaged in driverless car tech research — envisaging an evolution of its platform, down the road, where Ubers are driven by robots rather than self-employed human ‘partners’. The meatsacks will just be sitting in the back.
She plausibly suggests that Uber’s ultimate goal is to become an ‘on demand logistics platform’. The overlap with Amazon’s long term ambitions here seems particularly interesting. But what is most pressing to me is the question of when, if at all, the rhetoric of the ‘sharing economy’ will be abandoned.
There are strong prima facie grounds on which to argue that it functions as a discursive slight of hand, distracting attention from the terrifying scale of Uber’s ambitions. It would be an interesting exercise to try and evaluate this through a content analysis: how does Uber position itself in public, particularly in response to criticism? How, if at all, has this changed over time?