Note: Will Google Allow Ridesharing to Exist has been republished on my new website, ejorgenson.com. Come visit and subscribe to read all my new blog posts.
It's possible Ridesharing will become the greatest flash-and-crash industry of all time. An industry that grew to Billions in a few short years, that collapses to zero around the time it turns 10. Like Polaroid and Walkmen.
It's hard to imagine given how hot the space is right now that it could evaporate within a few years.
We're watching the commoditization of transportation in real-time. Every week there's a new tactic from one of the gladiators of the ride-sharing battle; a new feature, a new price cut, a new ad campaign. The chaos hides an economic truth—this market has barely any differentiation or brand loyalty. It will be hard to maintain a moat and a margin in the long run.
All while a giant looms, patiently watching.
It appears self-driving cars are going to enter our lives within 10–20 years. Human drivers cannot compete with the cost of software. Our rides will be 10% (or 1%) as expensive as with a human driver, so no company that is based on humans will last against software in a commoditized industry.
Google has a checkmate move.
They could refuse to license their self-driving technology, build their own cars, and put out an app. For huge cost savings, customers would flock to new Google cars; there are no switching costs to slow them down.
Even more staggering—Google could open new cities as fast as it produces cars! No onboarding. No recruiting. No managing. Just ship 1,000 cars to a city and flip the switch.
They can pick up a $10+ Billion line of business in a few short years. It's also synergistic with Google Shopping Express. There's lots to be done with that travel data in urban logistics. Or live-mapping. Or traffic reporting. Or… lots of other stuff. I'm sure Astro will find something cool.
Ride-sharing is becoming mainstream (and legal) thanks to the noble work of Uber, Lyft, etc. Yet Google may be the last one standing. It's the last mover that wins… and Google has the ultimate not-so-secret weapon.
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Disclaimer: I might not know what I'm talking about. Writing helps me think clearly and posting keeps me accountable for checking in on predictions and ideas. Thanks for playing along.
Other writing:
Differentiation [Book Summary]
Zero to One [Book Summary]
Make the Internet your Personal Library
How to College
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Get in touch: erjorgenson@gmail.comThanks to Shane Mac and Joe Scannell for making this passable.