SoftBank’s recent acquisition of Uber stock brings new urgency to the question of whether autonomous vehicles will weaken or strengthen Uber’s business model. While passenger comfort with self-driving cars will obviously play a role, Uber’s greatest strength comes from what happens before a passenger gets into a car.
Let’s pretend I’m founding the Liz Welsh Self-Driving Car Company. I have a bunch of kickass developers and a fleet of 50,000 autonomous vehicles. Huzzah! Now, where do I put the cars? If I decide to put all 50,000 self-driving cars in Des Moines, Iowa, the Liz Welsh Self-Driving Car Company is sure to fail.
With 7+ years of passenger data, Uber already knows where to put the cars. And I bet Uber is getting sick and tired of cajoling its human drivers into putting their cars there. After all, as long as Uber’s drivers really are independent contractors, the only thing Uber can legally tell them is where to pick up and drop off passengers. Robots are way easier and cheaper to have available for fluctuations in passenger demand.
Liz Welsh 