Uber Express Pool Expected to be a Cheaper and More Efficient Ride-Sharing Option

Especially in crowded metropolitan areas like San Francisco, New York, and Los Angeles, fewer and fewer people are choosing to drive. Between the cost of gas/maintenance and often the complete inability to find parking anywhere, many would-be drivers opt to use ride-sharing services like Uber or Lyft instead. For those who drive long distances on a daily basis, it still makes more sense to own a car, but for those who don't drive often, ride-sharing is the cheaper alternative. The cheapest variation of ride-sharing is UberPool, which lets multiple riders share an Uber and split the cost. According to an L.A. Times article written by Tracey Lien, an even cheaper and more efficient alternative, called Uber Express Pool, is on its way to LA.

Uber Pool, while great in that it can save a rider a few dollars on a trip and can give the driver the ability to pick up more fares in a shorter time, also has its downsides. One of the biggest complaints about the Uber Pool service is that it isn't a very fast way of getting anywhere. Inherently, when you opt to allow the driver to pick up other riders on the way to your destination, there will be a little bit of time added to your commute. However, because of the way Uber Pool is set up, it ends up being even longer, as the driver is directed to strange circuitous routes that the app calculates to "maximize efficiency," but which actually does the exact opposite. Additionally, for people taking a longer distance Uber Pool, the driver may pick up multiple passengers along the way, and then will have to go out of the way to drop them off before ever reaching the original rider's destination.

Uber Express Pool is expected to retain Uber Pool's upsides (especially its lowered prices) with fewer of its drawbacks. Some have compared Express Pool to a bus service in that it has designated pick-up and drop-off locations along routes created at a rider's request. Riders will have to walk a bit to get to where they're going, but this system avoids the wasted time of giving each rider door-to-door service, which makes each ride more efficient. It also allows riders to have a better approximation as to the time frame of their arrival. If the car isn't going off in random directions to pick up extra fares, then it's pretty easy to figure out how long the ride will take, even with multiple stops in the middle.

A somewhat similar system is already in place on several college campuses and airports, but that's more for ease of use and to ease traffic congestion. At those locations, there are designated pick-up and drop-off locations. By having those locations, the schools and airports don't have drivers constantly blocking up traffic, and drivers and riders are more easily able to find each other. When riders used to be able to request a pick-up anywhere on campus, it was often difficult for drivers to find them, as the routes through many college campuses tend to be difficult to navigate for people not accustomed to them. In all, it seems that the updated Express Pool will be beneficial to both riders and drivers, and is, therefore, a positive addition to Uber's array of services.

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Ikea Acquires TaskRabbit App, Helping Customers Connect with Furniture Assemblers

Tens of thousands of Americans have tasks that they don't want to do themselves. Either the jobs are physically impossible, or require skills that they don't have, or are simply not worth their time. In an effort to address that common problem, in 2008 Leah Busque founded a company called RunMyErrand, which later evolved into the app known as TaskRabbit. People around the country can use the app to hire "Taskers" to run errands or do odd jobs, and TaskRabbit keeps a percentage for connecting users to workers. According to Tracey Lien and Samantha Masunaga's L.A. Times article, Ikea recently acquired TaskRabbit in order to pair up furniture-building Taskers with Ikea's customers.

TaskRabbit was one of the very first on-demand apps, where users could pay a fee or an hourly rate to get a job done. Since then, many other companies have come in to fill the market, from Uber to Postmates and everything in between. The acquisition of TaskRabbit was a logical one for Ikea because their customers generally already outsourced the job of putting together their furniture anyway. Many customers can't figure out how to assemble Ikea furniture, so it is often simpler for them to hire someone to do it instead. By acquiring TaskRabbit, Ikea is able to get the business on both ends.

From another perspective, Ikea acquired TaskRabbit as an investment, given that the app has been pretty successful over the years since its conception. The company provides a smartphone app that allows Taskers to connect with users looking to hire help. In exchange for providing the service and convenience of their app, TaskRabbit receives 30% of the hourly payment being given to the Tasker completing the job, which is a pretty large chunk of money when movers and furniture assemblers can be making anywhere between $30 and $80 per hour. Neither company has released a public statement about how much the company sold for, but it can probably be assumed that Ikea made a sound investment.

Other on-demand service companies like Uber and Lyft or Sprig and Homejoy have either had to rely on millions of dollars in venture capital and debt financing or have failed to raise enough money and have had to go bankrupt before ever obtaining success. TaskRabbit is different in that it's been profitable for quite a while. The company's acquisition by Ikea is probably a good thing for its future growth. Now that they are connected to the largest furniture company in the US, they have the resources to expand more rapidly and reach a larger, international base of customers.

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Uber to Make Improvements to App After CEO Resignation

Uber has been going through issues lately with maintaining a positive public image. Various scandals, especially regarding its CEO, have been hurting the company's public relations, which can hurt its bottom line. Ever since the CEO, Travis Kalanick, recently resigned, the company has been working to regain customer loyalty and get back a portion of their market share that had been lost to Lyft and other competitors. Tracey Lien's L.A. Times article outlines some of Uber's planned changes to make the rides better for riders and drivers alike.

Uber's first planned change is to enable a feature that Lyft has had for a while: passengers will be able to tip a driver through the app. By adding this capability, Uber hopes to show its users that the company cares about improving relationships between drivers and passengers. Additionally, in an effort to make the relationship less one-sided, Uber's policies on ride cancellations is changing. Previously, riders had 5 minutes to cancel a request after summoning a driver, which often left drivers sitting around for a while, waiting for passengers that might cancel at the last second.

The changes make it so that a customer has only two minutes to cancel without paying a $5 penalty, and riders will be charged per minute for keeping their driver waiting for them. In this manner, riders have fewer opportunities to take advantage of their position, in much the same way that enabling both parties to see their own ratings could help both rider and driver modify their behavior in the relationship, which makes for a more pleasant overall experience.

Many of Uber's changes are intended to improve driver-rider relationships, to show that the company cares about its users and to improve customer loyalty. However, one change seems to both address a concern raised by users as well as expand Uber's user base. There are many potential users out in the world who don't own a smartphone or don't have access to mobile internet. To address this problem, Uber's latest update will allow a customer to book a ride for someone else. The driver will receive the passenger's contact information, and the passenger will receive a text message with the driver's description and a link to track their route. This feature is especially useful for seniors and other users who may not be as tech-savvy.

Some of the features designed to benefit the senior demographic were already made available through services run through third parties. For example, Uber has a partnership with 24Hr HomeCare that allows customers to book rides via a phone call rather than through the smartphone app. Additionally, there are other services called GoGoGrandparent, Instacart, Munchery, and Postmates, that all utilize telephone calls to allow users to book rides or have food or groceries delivered. So, it seems that Uber is getting into that portion of the market a bit late. Hopefully, all of the proposed changes will do enough to overpower the negative influence that months of scandals formed.

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Uber Update Lets Users See How They Have Been Rated by Drivers

Especially for people living in densely populated cities like Los Angeles or New York, it can be difficult to justify owning a vehicle. Traffic is usually difficult to deal with, parking can be nearly impossible to find, and unless you're driving a significant distance each day, the combination of gasoline, insurance, and maintenance can make it all too costly. Fortunately, ride-sharing technology gives people a way to get around town without having to own a car of their own.

While there are many ride-sharing smartphone applications, the two most popular and well-known are Uber and Lyft. Each has similar business plans: they take a percentage of every dollar earned by one of their drivers. Both driver and rider have the opportunity to rate each other, and the ratings help other drivers and riders to choose whether they want to use the service. Until recently, riders could see all of the ratings (on a 5-star scale) that other riders had left for their driver, and drivers could see ratings left for riders. According to Tracey Lien's L.A. times article, a recent update to the Uber app will allow riders to view their own ratings.

Uber executives hope that this update will help both drivers and riders to improve the ride-sharing experience. The riders can rate the drivers on safety, friendliness, and cleanliness of the vehicle, while drivers can rate riders on whether they leave a mess in the car or if they slam the doors. Because riders will now be able to see what drivers think of them, it is hoped that they will be more cognizant of their behavior and will, therefore, become better passengers.

Everyone wants to have a high rating on apps like Uber because the app's algorithm matches up riders and drivers based on similar rankings. So, if a rider has close to 5 stars, they will likely get paired up with a driver with a 5-star rating. If they have a lower score, they will, in turn, be paired up with a less-sought-after driver. While this update should be beneficial to everyone, another update aims to help drivers avoid being negatively affected by the behavior of other passengers in an UberPool, in which a rider chooses to share the ride with another user of the app. Lately, Uber has had some bad press, but the changes they are making could help to improve their image, retain their drivers, and win back potential riders.

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Waze's Latest Feature Enables Users to Order Food in the App

Technological innovations in this day and age are often about making day to day tasks easier or more convenient. They help people to save time and money on mundane tasks like ordering food or obtaining transportation. This week, according to an L.A. Times article by the Associated Press, the navigation app Waze has started to team up with fast-food restaurants like Dunkin' Donuts in order to combine the services offered by the two companies and make ordering coffee and other foods on the way to work a seamless process.

Waze is a popular navigation app for smartphones and tablets, which relies mainly on information input by users. It provides turn-by-turn directions and can even tell drivers in real time which route will have the least traffic. While Waze has teamed up with fast-food restaurants like Taco Bell and Dunkin' Donuts in the past, it was mainly an advertising partnership, where the restaurants paid Waze a fee each month to help remind drivers of the different food options on their route. Now, their business strategy has changed, and become more direct.

Instead of just advertising with Waze, and hoping that the ads will make a few drivers visit their restaurant, Waze has now integrated a method for drivers to order from Dunkin' Donuts and pick it up on their route, all without opening up another app. If the trial run with Dunkin' Donuts goes well, Waze could relatively easily update the system to work for any number of merchants and restaurants. One day, people could be able to order food, reserve parking spots, and even get prescriptions filled, all on the way, without the inherent distractions involved with working from several apps at once.

Users of Waze's new system will have to have Dunkin' Donuts' app on their phone, but as long as they are logged in, Waze will be connected and will be able to access their account at the push of a button. Additionally, users of Waze's system have to be registered with Dunkin' Donuts' customer loyalty program, at least until the chain has determined whether the concept works well enough to offer to all of its customers. Waze has been growing in leaps and bounds lately. Recently, they integrated a feature similar to Uber or Lyft where drivers are paid to pick up and drive with other Waze users looking to Carpool. All of these updates seem to be going well for Waze, but it will take a bit of time to see just how well.

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Uber and Lyft's Low Prices Won't Last Forever

Besides its convenience factor, a user's ability to rate their drivers, and the inherent safety that comes with the app tracking your motion along a pre-determined route, Uber has attracted so many customers in large part due to its subsidized pricing. Over the years, Uber has aggressively pushed to become the leader in the ride-sharing market. To do so, they have often offered prices that are discounted to such an extent that the company sinks billions of dollars into the app each year. While it may seem counter-intuitive to lose money, Uber is actually proceeding exactly as planned: they are focusing first on acquiring customers and forcing out any competitors before they try to turn a profit. Tracy Lien, in her L.A. Times article, addresses Uber's plan and describes how such a monopoly might affect the market.

Uber and Lyft, the most popular ride-sharing services, both know that the fastest way to get loyal customers id to give them a cheaper alternative to taxis. While many consumers still prefer taking a taxi over using one of the ride-sharing apps, most people care more about saving some money. Fortunately for consumers, the ride-sharing apps are not only competing against taxis, they are also competing against each other, which has allowed prices to fall even lower. Eventually, though, as economists have reiterated time and again, when one of the companies gains control of the market, their prices will go up. Maybe it will be slow at first, but it is a law of economics that if one company is the only source of a good or service, consumers are either forced to pay whatever price the company sets or live without it.

Uber is currently valued at over $62 billion, and is by far the market leader, even though they continuously lose money or barely break even in their attempt to grow their market share. While Lyft is in second place, they also have plenty of money to burn, especially after a recent $500 million investment by General Motors. In fact, while Lyft is falling behind Uber in most areas, they have nearly half of the market share in their hometown of San Francisco. It's possible that Uber won't be able to force Lyft out of the competition in the long-run, or they may find that the attempt would be too costly to be economical. However, economists still worry about what might happen if Lyft and other competitors were forced to back out.

Uber just lost a battle in China to become the main provider of ride-sharing services. That loss could lead Uber to focus on the US and Europe more closely and work harder on taking as much market share as possible. Therefore, it is believed that their prices will go even lower in the near future. If they can keep their prices low enough for a long enough time, they may be able to gain enough customers to be unstoppable. Some economists believe that Uber should look toward becoming more valuable to the consumer rather than a cheaper option. The Premier options in ride-sharing apps attract upper-class customers, which could be a substantial source of boosted income for Uber, even if they don't succeed in encapsulating the entire market.

While it is likely that all of the ride-sharers will eventually start raising prices in the future, there are several reasons why they wouldn't suddenly shoot up to exorbitant rates. First, there are anti-trust laws and similar regulations on how much a company can charge for a product or service, especially if that company is one of only a few providers. Additionally, if Uber or Lyft suddenly started charging extremely high prices, their customers would just switch to taking taxis. So, whatever happens with their market share, economic theory would tell us that the ride-sharing apps would steer away from charging more than taxis unless they somehow found a way to remove that competitor entirely, which is unlikely.

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General Motors Prepares to Become More Involved in "Ride-Sharing" Economy

Companies like Airbnb, Uber, and Lyft work based on opportunities available in what is called the "sharing economy." This generally means that their businesses run on the principle of connecting individuals that are willing to share their home or vehicle, for the right price. This type of business model is also known as "crowdsourcing" or "crowdfunding," and mainly involves the business creating an app or website, and acting as an impartial mediator between owners and consumers. Samantha Masunaga and Charles Fleming discuss, in their L.A. Times article, a new type of crowdsourced company called Maven, which involves the short-term rental of vehicles.

Just as Airbnb involves the short-term rental of a home, condominium, or apartment, Maven allows for users to "rent" a car for a short time. While the service has recently started in Ann Arbor, catering toward students at the University of Michigan, the company has plans to expand to other cities as the year progresses. Through this car sharing service, launched by General Motors, provides a free app on smartphones, which can be used to reserve a vehicle and unlock it. GM expects that a relationship with ride-sharing Lyft and its experience with services like OnTrac will help to make Maven a success.

General Motors is not the only company trying to get its foot in the door of this potentially lucrative business opportunity. Ford started a similar service in June and GM started a version in Germany called Car-Unity, which allowed rental to Facebook friends or members of the app's network. BMW has even begun to include features on their newest cars to allow for app-based connectivity. Everyone benefits: people have the ability to borrow a vehicle when they need one, and the owners of the vehicles are able to somewhat subsidize the costs of purchasing the vehicle in the first place.

Analysts wonder whether GM's decision, while bold, has long-term potential for the future. GM recently bought a failing ride-hailing company called Sidecar Technologies, Inc. and invested $500 million in Lyft. It seems that GM is trying to be prepared for any possible entrance into the ride-sharing market, and plans to do so by partnering with the best in the business. One day, GM hopes to partner with Lyft on an Autonomous On-Demand Network, which would even allow users to reserve self-driving cars. Although the market for self-driving cars has yet to fully expand, GM is planning ahead, predicting that today's investments will ensure success down the line.

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