Blog

What's all the fuss about Uber - game changer or breaker?

Hardly a day goes by where Uber is not in the news, mainly under some controversy or the other. I haven't seen so much fuss over a company since the old Microsoft anti-trust days. Uber is now quickly becoming a verb like Google. The 'Uberification' of an industry is quite routinely used in business media now.

To say Uber is controversial is quite an understatement. So what's all the fuss about then?

Uber is about the Empowerment of the masses

The concept of Uber is not new, the web was always about empowerment of the individual. Many companies have come and gone, trying to give autonomy and power to the individual. What makes Uber different is the sheer size, scale and money backing it.

Large companies are all wary of Uber as it's a direct threat to their slice of the market but more importantly it threatens their very nature of doing business i.e. on large company serving thousands of customers through a dedicated group of employees.

Under the Uber model, applied to many industries, your neighbour becomes your taxi driver, your host, your printer or even your cook!

Uber has used its app to destroy one of the biggest advantages of a business enterprise - Billing

Billing is one of the biggest hidden advantages that business enterprises have. When you buy from an enterprise they have a set billing system through which you pay. It's important to note that it's not about taking payments, PayPal has been around for decades, it's about Billing. There is a distinction.

When the market has many individual service providers there is a huge inconsistency in billing rates and service valuation. Someone might charge higher for the same service and others lower. But when you get into a Uber cab or any ' Uberized' service, you know exactly what you will be billed.

By giving the common billing platform Uber has decisively taken away the key advantage of a bit business enterprise.

Uber is more than a business, it's an idea whose time has come!

Lots of companies are feeling threatened by ' Uber like' services and they are right to do so. You can fight with a business but you cannot fight an idea whose time has come. Monolithic corporations will be decimated overnight through Uberification of their core services.

Technology has reached such a stage that this idea can no longer be denied. A fortuitous confluence of mobile devices, app technology, willing service providers has created a perfect recipe for this concept to take off.

There is no going back now.

Uber like services still do have a lot of challenges to overcome.

The biggest challenge for services like Uber is how to ensure quality with such a distributed network of service providers who are very loosely controlled by the company.

Reports of poor service and bad behaviour hit the headlines regularly and erupt into huge controversies fueled by businesses whose market share is being eroded.

Companies like Uber can and do a lot of verification before allowing service providers to join the network but there is no guarantee that some bad apples will not slip through. But supporters of Uber are quick to point out that this could easily happen, and has happened, with a centralized company as well.

The next decade will tell us whether the Uber concept will survive or pass away like a fad. My money's (figuratively of course) is on the survival and growth of Uber like businesses with increased professionalism from constituent service providers.

Its going to be interesting to watch.

Cheers,

Ron