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What lower Netflix pricing tells us about competing in India

Posted by | Amazon, Apple, Apps, Asia, China, Cred, Disney, Facebook, Finance, FreeCharge, funding, Fundings & Exits, Google India, HBO, Hotstar, iPhone, LinkedIn, Media, Mobile, Netflix, Paytm, Reed Hastings, Satyan Gajwani, SnapDeal, Spotify, Tim Cook, Times Internet, Uber, Vijay Shekhar Sharma | No Comments

At a conference in New Delhi early last year, Netflix CEO Reed Hastings was confronted with a question that his company has been asked many times over the years. Would he consider lowering the subscription cost in India?

It’s a tactic that most Silicon Valley companies have adapted to in the country over the years. Uber rides aren’t as costly in India as they are elsewhere. Spotify and Apple Music cost less than $2 per month to users in the country. YouTube Premium as well as subscriptions to U.S. news outlets such as WSJ and New York Times are also priced significantly lower compared to the prices they charge in their home turf.

Hastings had also come prepared: He acknowledged that the entertainment viewing industry in India is very different from other parts of the world. To be sure, much of the pay-TV in India is supported by ads and the access fee remains too low ($5). But that was not going to change how Netflix likes to roll, he said.

“We want to be sensitive to great stories and to fund those great stories by investing in local content,” he said. “So yes, our strategy is to build up the local content — and of course we have got the global content — and try to uplevel the industry,” he said, identifying movie-goers who spend about Rs 500 ($7.25) or more on tickets each month as Netflix’s potential customers.

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Indian commuters walking below a poster of “Sacred Games”, an original show produced by Netflix (Image: INDRANIL MUKHERJEE/AFP/Getty Images)

Less than a year and a half later, Netflix has had a change of heart. The company today rolled out a lower-priced subscription plan in India, a first for the company. The monthly plan, which restricts usage of the service to mobile devices only, is priced at Rs 199 ($2.8) — a third of the least expensive plan in the U.S.

At a press conference in New Delhi today, Netflix executives said that the lower-priced subscription tier is aimed at expanding the reach of its service in the country. “We want to really broaden the audience for Netflix, want to make it more accessible, and we knew just how mobile-centric India has been,” said Ajay Arora, Director of Product Innovation at Netflix.

The move comes at a time when Netflix has raised its subscription prices in the U.S. by up to 18% and in the UK by up to 20%.

Netflix’s strategy shift in India illustrates a bigger challenge that Silicon Valley companies have been facing in the country for years. If you want to succeed in the country, either make most of your revenue from ads, or heavily subsidize your costs.

But whether finding users in India is a success is also debatable.

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Uber riders now earn rewards for shopping during their trip with new Cargo app

Posted by | Amazon, Android, cargo, carsharing, commuting, driver, eCommerce, line, Nintendo, operating systems, Software, TC, transport, Transportation, Uber, universal studios | No Comments

Uber is launching a new shopping app with commerce partner Cargo, a startup with which it signed an exclusive global partnership last year. The app will feature items curated by Uber, including products like Nintendo Switch, Apple hardware, Away luggage, Glossier cosmetics and more, and will be available to download for Uber riders making trips in cars that have Cargo consoles on board. The Cargo app will also provide in-ride entertainment, including movies from Universal Studios available to purchase for between $5 and $10 each (with bundle discounts for multiple movies), which are then viewable in the Movies Anywhere app.

Uber riders will also benefit by receiving 10% of their purchase value back in Uber Cash, which they can then use either on future trips or on other purchases made through the Cargo app while riding. Uber drivers also benefit, earning 25% of the value of items purchased from the Cargo Box in-car, and an additional $1 for each first purchase by a passenger through the new app.

Riders just need to grab the iOS or Android app and then scan the QR code located on the Cargo Box in their driver’s car. Cargo’s app only allows purchases while on the trip, and then the item will be automatically shipped to a rider’s home address for free with an estimated delivery time of between two and five business days.

Cargo App Home Screen

This tie-up is a natural evolution for Uber’s business — the company hosts millions of riders every week, and many of those are taking relatively long trips to and from airports and other transit hubs, which provides ample opportunity to get them buying stuff or watching purchased content. Cargo, in which Uber has some equity stake, has a good opportunity to figure out how best to make the most of those trips.

This is hardly without precedent — airlines have attempted to capture consumer interest in the skies with onboard duty-free and other sales, as well as content for purchase. The big question will be whether Uber and Cargo together can provide enough additional purchase incentive versus riders just opening the Amazon app or other commerce options they have available on their own personal devices to make it a sustainable extension of their business.

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Uber Eats invades restaurants with Dine-In option

Posted by | allset, Apps, eCommerce, food, Mobile, OpenTable, payments, resy, TC, Uber, ubereats | No Comments

Tired of cleaning up after take-out or getting hangry waiting at your table in restaurants? Well Uber Eats is barging into the dine-in business. A new option in some cities lets you order your food ahead of time, go to the restaurant, then sit down inside to eat, a tipster from competing dine-in app Allset tells us. We tested it, and Uber Eats Dine-In even waives the standard Uber delivery and service fees.

Adding Dine-In lets Uber Eats insert itself into more food transactions, expand to restaurants that care about presentation and don’t do delivery and avoid paying drivers while earning low-overhead revenue. Uber’s Dine-In option is now available in some cities, including Austin, Dallas, Phoenix and San Diego, where it could save diners time and fees while helping restaurants fill empty tables and waiters earn tips. But it also could coerce more restaurants to play ball with UberEats if their competitors do, eating into their margins.

UberEats Dine In Option

Uber confirmed the existence of the Dine-In option, telling me, “We’re always thinking about new ways to enhance the Eats experience.” They also verified there are no delivery or service fees, and restaurants get 100% of tips left in-app by users. However, we found some items were silently marked up from restaurants’ listed prices in both Uber Eats Delivery and Dine-In options, which could help it make some money directly from these purchases. We also discovered this buried Uber Help Center FAQ with more details.

Uber has been rapidly experimenting with Uber Eats, trying discounted specials, Uber Eats Pool, where you pay less for slower delivery, and $9.99 unlimited delivery subscriptions. It’s steadily becoming an omnivore.

How Uber Dine-In Works

Dine-in appears next to the Delivery and Pick-Up options across the top of the Uber Eats app in select cities. You order from the menu and can choose to go eat “ASAP” or in some cases schedule when you want to arrive and sit down. You’ll be shown how long the food will take to prep, distance to the restaurant, your price and the restaurant’s rating. You’ll then be notified as the order is prepared and approaches readiness. Then you just deliver yourself to the restaurant and the food is ready to be served as soon as you sit down. You can add a tip in-app or on the table.

Uber Eats should obviously make it easy for you to hail an Uber with the restaurant as the pre-set destination. An Uber spokesperson called that a good idea but not something it’s doing yet. Back in 2016, Uber tried a merchant-sponsored rides option where you’d get a rebate on your travel if you spent money at a given store. You could imagine restaurants that want to show off their ambiance giving customers some money back if they come across town to eat there.

Uber Dine In

The new feature could spell trouble for other dine-in apps like Allset that’s been in the business for four years. Users might also opt for Uber Eats Dine-In over restaurant reservation apps like OpenTable and Resy. Why waste time waiting to order and for your food to be cooked when you could just show up as it comes out of the oven?

“I think that more delivery players will be tapping into dine-in space. It’s all about convenience and time saving. But it’s going to be very difficult for them, given their focus on delivery,” Allset CEO Stas Matviyenko said of Uber becoming a competitor. He believes dedicated apps for different modes of dining will succeed. But Uber Eats’ ubiquity and its one-stop-shop model for all your dining needs could make it stickier than a dine-in only app you use less frequently.

UberEatsheader

With Dine-In, Uber could aid restaurants that are empty at the start or end of their open hours. Last year we reported that Uber Eats was giving restaurants prominence in a Featured section of the app to drive up demand if they offered discounts to customers. Similarly, Uber could let restaurants entice more Dine-In customers, especially when foot-traffic was slow, by providing discounts on food or subsidized Uber transportation. Better to knock a dollar or two off an entree if it means filling the restaurant at 5:30 or 9:30 pm.

And now that Uber Eats does delivery, take-out and dine-in, it’d make perfect sense to offer traditional restaurant reservations through the app as well. That would pit it directly against OpenTable, Resy and Yelp. Instead of trying to own a single use case that might only appeal to certain demographics in certain situations, Uber Eats’ strategy is crystallizing: be the app you open whenever you’re hungry.

[Postscript 7pm PT: You could view the minutes typically spent being seated, perusing the menu, and waiting for your food to be served as either “friction” to eliminate for efficiency, or quality time you should spend with your meal mates. Both are valid perspectives, but I don’t think there’s anything wrong with being given a choice. For some people who eat alone, it could be quite nice to be able to cut down the wait, perhaps encouraging them to dine in public more often. And really, hasn’t Uber always been about “saving” time that could have been spent meaningfully if not for its raw pursuit of delivering convenience?]

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Higher Ground Labs is betting tech can help sway the 2020 elections for Democrats

Posted by | america, Barack Obama, Betsy Hoover, Brad Parscale, Brandwatch, breitbart news, Cambridge Analytica, campaign manager, Chris Sacca, Civis Analytics, communication tools, computing, CRM, democratic party, donald j trump, Facebook, Forbes, Google, greylock, Higher Ground Labs, Hillary Clinton, Insight Venture Partners, LinkedIn, mitt romney, Mobile, ngp van, online tools, paris, PayPal, president, presidential election, Reid Hoffman, republican national committee, republican party, republicans, Ron Conway, Shomik Dutta, social media, social media tools, Software, sv angel, TC, technology, Uber | No Comments

When Shomik Dutta and Betsy Hoover first met in 2007, he was coordinating fundraising and get-out-the-vote efforts for Barack Obama’s first presidential campaign and she was a deputy field director for the campaign.

Over the next two election cycles the two would become part of an organizing and fundraising team that transformed the business of politics through its use of technology — supposedly laying the groundwork for years of Democratic dominance in organizing, fundraising, polling and grassroots advocacy.

Then came Donald J. Trump and the 2016 election.

For both Dutta and Hoover, the 2016 outcome was a wake-up call against complacency. What had worked for the Democratic party in 2008 and 2012 wasn’t going to be effective in future election cycles, so they created the investment firm Higher Ground Labs to provide financing and a launching pad for new companies serving Democratic campaigns and progressive organizations.

As the political world shifts from analog to digital, we need a lot more tools to capture that spend,” says Dutta. “Democrats are spending on average 70 cents of every dollar raised on television ads. We are addicted to old ways of campaigning. If we want to activate and engage an enduring majority of voters we have to go where they are (and that’s increasingly online) and we have to adapt to be able to have these conversations wherever they are.”

Social media and the rise of “direct to consumer” politics

While the Obama campaign effectively used the internet as a mobilization tool in its two campaigns, the lessons of social media and mobile technologies that offer a “direct-to-consumer” politics circumventing traditional norms have, in the ensuing years, been harnessed most effectively by conservative organizations, according to some scholars and activists.

“The internet is a tool and in that sense it’s neutral, but just like other communication tools from the past, people with more power, with more resources, with more organization, have been able to take advantage of it,” Jen Schradie, an assistant professor at the Observatoire sociologique du changement at Sciences Po in Paris, told Vox in an interview earlier this month.

Schradie is a scholar whose recent book, “The Revolution That Wasn’t,contends that the internet’s early application as a progressive organizing tool has been overtaken by more conservative elements. “The idea of neutrality seems more true of the internet because the costs of distributing information are dramatically lower than with something like television or radio or other communication tools,” she said. “However, to make full use of the internet, you still need substantial resources and time and motivation. The people who can afford to do this, who can fund the right digital strategy, create a major imbalance in their favor.”

Schradie contends that a web of privately funded think tanks, media organizations, talk radio and — increasingly — mobile applications have woven a conservative stitch into the fabric of social media. The medium’s own tendency to promote polarizing and fringe viewpoints also served to amplify the views of pundits who were previously believed to be political outliers.

Essentially, these sites have enabled commentators and personalities to create a patchwork of “grassroots” organizations and media operations dedicated to reaching an audience receptive to their particular political message that’s funded by billionaire donors and apolitical corporate ad dollars.

Then there’s the technology companies, like Cambridge Analytica, which improperly used access to Facebook data for targeting purposes — also financed by these same billionaires.

“The last six years have witnessed millions and millions of dollars of private Koch money and Mercer money that have gone to pretty sophisticated data and media efforts to advance the Republican agenda,” says Dutta. “I want to even the scale.”

Dutta is referring to Charles and David Koch and Robert Mercer, the scions and founder (respectively) of two family dynasties worth billions. The Koch brothers support a web of political advocacy groups, while Mercer and his daughter were large backers of Breitbart News and Cambridge Analytica, two organizations that arguably provided much of the policy underpinnings and online political machinery for the Trump presidential campaign.

But there’s also the simple fact that Donald Trump’s digital strategy director, Brad Parscale, was able to effectively and inexpensively leverage the social media tools and data troves amassed by the Republican National Committee that were already available to the candidate who won the Republican primary. In fact, in the wake of Romney’s loss, Republicans spent years building up profiles of 200 million Americans for targeted messaging in the 2016 election.

“Who controls Facebook controls the 2016 election,” Parscale said during a speaking engagement at the Romanian Academy of Sciences, according to a report in Forbes.

Parscale, now the campaign manager for the president’s 2020 reelection campaign recalled, “These guys from Facebook walked into my office and said: ‘we have a beta … it’s a new onboarding tool … you can onboard audiences straight into Facebook and we will match them to their Facebook accounts,’ ” according to Forbes .

During the 2016 campaign, Hillary Clinton’s team made 66,000 visual ads, according to Parscale, while the Trump campaign made 5.9 million ads by leveraging social media networks and the language of memes. And in the run-up to the 2020 election, Parscale intends to go back to the same well. The Trump campaign has already spent more than $5 million on Facebook ads in the current election cycle, according to The New York Times outspending every single Democratic candidate in the field and roughly all of the Democrats combined.

Reaching higher ground

Dutta and Hoover are working to offset this movement with investments of their own. Back in 2017, the two launched Higher Ground Labs, an early-stage company accelerator and investment firm dedicated to financing technology companies that could support progressive causes.

The firm has $15 million committed from investors, including Reid Hoffman, the co-founder of LinkedIn and a partner at Greylock; Ron Conway, the founder of SV Angel and an early backer of Google, Facebook and Twitter; Chris Sacca, an early investor in Uber; and Elizabeth Cutler, the founder of SoulCycle. Already, Higher Ground has invested in more than 30 companies focused on services like advocacy outreach, polling and campaign organizing — among others. 

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The latest cohort of companies to receive backing Higher Ground Labs

“It is vitally important that Democrats learn to do their campaigns online,” says Dutta. “The way you recruit volunteers; the way you poll sentiment; the way you target and mobilize voters has to be done with online tools and has to improve in the progressive movement and that’s the job of Higher Ground Labs to fix.”

For-profit companies have a critical role to play in election organizing and mobilization, Dutta says. Thanks to government regulation, only private companies are allowed to trade data across organizations and causes (provided they do it at fair market value). That means advocacy groups, unions and others can tap the information these companies collect — for a fee.

The Democratic Party already has one highly valued private company that it uses for its technology services. Formed from the merger of NGP Software and Voter Activation Network, two companies that got their start in the late 1990s and early 2000s, NGP VAN is the largest software and technology services provider for Democratic campaigns. It’s also a highly valued company, which received roughly $100 million in financing last year from the private equity firm Insight Venture Partners, according to people familiar with the investment. Terms of the deal were not disclosed.

“Our vision has been to build a platform that would break down the painful data silos that exist in the campaigns and nonprofit space, and to offer truly best-in-class digital, fundraising and organizing features that could serve both the largest and the smallest nonprofits and campaigns, all with one unified CRM,” wrote Stu Trevelyan, the chief executive of NGP VAN + EveryAction, in an August blogpost announcing the investment. “We’re so excited that others, like our new partners at Insight, share that vision, and we can’t wait to continue innovating and growing together in the coming years.”

Can startups lead the way?

Even as private equity dollars boost the firepower of organizations like NGP VAN, venture capitalists are financing several companies from the Higher Ground Labs portfolio.

Civis Analytics, a startup founded by the former chief analytics officer of Barack Obama’s 2012 reelection campaign, raised $22 million from outside investors, and counts Higher Ground Labs among its backers. Qriously, another Higher Ground Labs portfolio company, was acquired by Brandwatch, as was GroundBase, a messaging platform acquired by the nonprofit progressive advocacy organization ACRONYM.

Other companies in the portfolio are also attracting serious attention from investors. Standouts like Civis Analytics and Hustle, which raised $30 million last May, show that investors are buying into the proposition that these companies can build lasting businesses serving Democratic and progressive political campaigns and corporate businesses that would also like to rally employees or personalize a marketing pitch to customers.

These are companies like Change Research, an earlier-stage company that just launched from Higher Ground Labs accelerator last year. That company, founded by Mike Greenfield, a serial Silicon Valley entrepreneur who was the first data scientist working on the problem of fraud detection at PayPal, and Pat Reilly, a communications professional who worked with state and local Democratic politicians, is slashing the cost of political polling.

“I wanted to do something for American democracy to try and improve the state of things,” Greenfield said in an interview last year.

For Greenfield, that meant increasing access to polling information. He cited the test case of a Kansas special election in a district that Donald Trump had won by 27 points. Using his own proprietary polling data, Greenfield predicted that the Democratic challenger, James Thompson, would pose a significant threat to his Republican opponent, Mike Estes.

Estes went on to a 7% victory at the ballot, but Thompson’s campaign did not have access to polling data that could have helped inform his messaging and — potentially — sway the election, said Greenfield.

“Public opinion is used to ween out who can be most successful based on how much money they’re able to raise for a poll,” says Reilly. It’s another way that electoral politics is skewed in favor of the people with disposable income to spend what is a not-insignificant amount of money on campaigns.

Polls alone can cost between $20,000 to $30,000 — and Change Research has been able to cut that by 80% to 90%, according to the company’s founders.

“It’s safe to say that most of the world was stunned by the outcome [of the presidential election] because most polls predicted the opposite,” says Greenfield. “Being a good American and as a parent of a 10-year-old and a 12-year-old, providing forward-thinking candidates and causes with the kind of insight they needed to win up and down the ballot could not only be a good business, but really help us save our democracy.”

Change Research isn’t just polling for politicians. Last year, the company conducted roughly 500 polls for political candidates and advocacy groups.

“The way that I’ve described Change Research to investors is that we want to simultaneously move the world in a better direction and having a positive impact while building a substantial business,” says Greenfield. “We’re only going to work with candidates and causes that we’re aligned with.”

Being exclusively focused on progressive causes isn’t the liability that many in the broader business community would think, says Dutta. Many Democratic organizations won’t work with companies that sell services to both sides of the aisle.

For Higher Ground Labs, a stipulation for receiving their money is a commitment not to work with any Republican candidate. Corporations are okay, but conservative causes and organizations are forbidden.

“We’re in a moment of existential crisis in America and this Republican party is deeply toxic to the health and future of our country,” says Dutta. “The only path out of this mess is to vote Republicans out of office and to do that we need to make it easier for good candidates to run for office and to engage a broader electorate into voting regularly.”

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Shuttl is winning over office workers in India with safer bus commute option

Posted by | Amazon, amit singh, Android, Apps, Asia, Ather Energy, BankBazaar, Emvantage, Facebook, Google, housejoy, india, meesho, Shuttl, starbucks, TC, Transportation, Uber | No Comments

Miles away from the fancy parts of Gurgaon, where a cohort of Uber and Ola cars race all day to dot the surrounding, hundreds of people are working on a different solution to contribute to India’s push for improved mobility.

When Uber entered India six years ago, and its local rival Ola began to expand in the nation, many thought the two cab services will be able to meet the needs of most Indians. To be sure, the heavily discounted cab rides in the early days meant that the two companies were able to quickly scale their businesses to dozens of cities and were clocking about three million rides a day.

But in the years since, it has become clear that Ola and Uber alone can’t serve the masses — a significant portion of which lacks the means to book a cab ride — or magically circumvent through India’s alarmingly congested roads. This has resulted in the emergence of a growing number of electric bike makers such as Yulu — which partnered with Uber last month, Vogo — which is backed by Ola,  Bounce, and Ather Energy that are both showing promising growth and attracting big bucks from investors.

For four years, another startup has been quietly working on expanding its platform. But unlike the bike startups and cab aggressors, it is betting on buses. Shuttl operates over 1,300 buses in more than 300 routes in five cities of India. The platform serves more than 65,000 customers each day.

Shuttl, too, hasn’t had much difficulty in attracting capital. It has raised about $48.5 million to date. TechCrunch recently learned that the startup was in talks with investors to raise an additional $50 million. Amit Singh, cofounder and CEO of Shuttl, declined to comment on the upcoming funding round. But he sat with us to explain his business and the challenges it comes with.

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Facebook announces Libra cryptocurrency: All you need to know

Posted by | Anchorage, Andreessen Horowitz, Apps, blockchain, coinbase, cryptocurrency, Developer, eBay, eCommerce, Facebook, Farfetch, Finance, funding, Libra Association, Libra Cryptocurrency, Lyft, Mobile, Move coding language, payments, PayPal, Policy, privacy, Ribbit Capital, Social, Spotify, stablecoin, stripe, TC, Thrive Capital, Uber, Union Square Ventures, visa | No Comments

Facebook has finally revealed the details of its cryptocurrency, Libra, which will let you buy things or send money to people with nearly zero fees. You’ll pseudonymously buy or cash out your Libra online or at local exchange points like grocery stores, and spend it using interoperable third-party wallet apps or Facebook’s own Calibra wallet that will be built into WhatsApp, Messenger and its own app. Today Facebook released its white paper explaining Libra and its testnet for working out the kinks of its blockchain system before a public launch in the first half of 2020.

Facebook won’t fully control Libra, but instead get just a single vote in its governance like other founding members of the Libra Association, including Visa, Uber and Andreessen Horowitz, which have invested at least $10 million each into the project’s operations. The association will promote the open-sourced Libra Blockchain and developer platform with its own Move programming language, plus sign up businesses to accept Libra for payment and even give customers discounts or rewards.

Facebook is launching a subsidiary company also called Calibra that handles its crypto dealings and protects users’ privacy by never mingling your Libra payments with your Facebook data so it can’t be used for ad targeting. Your real identity won’t be tied to your publicly visible transactions. But Facebook/Calibra and other founding members of the Libra Association will earn interest on the money users cash in that is held in reserve to keep the value of Libra stable.

Facebook’s audacious bid to create a global digital currency that promotes financial inclusion for the unbanked actually has more privacy and decentralization built in than many expected. Instead of trying to dominate Libra’s future or squeeze tons of cash out of it immediately, Facebook is instead playing the long-game by pulling payments into its online domain. Facebook’s VP of blockchain, David Marcus, explained the company’s motive and the tie-in with its core revenue source during a briefing at San Francisco’s historic Mint building. “If more commerce happens, then more small businesses will sell more on and off platform, and they’ll want to buy more ads on the platform so it will be good for our ads business.”

The risk and reward of building the new PayPal

In cryptocurrencies, Facebook saw both a threat and an opportunity. They held the promise of disrupting how things are bought and sold by eliminating transaction fees common with credit cards. That comes dangerously close to Facebook’s ad business that influences what is bought and sold. If a competitor like Google or an upstart built a popular coin and could monitor the transactions, they’d learn what people buy and could muscle in on the billions spent on Facebook marketing. Meanwhile, the 1.7 billion people who lack a bank account might choose whoever offers them a financial services alternative as their online identity provider too. That’s another thing Facebook wants to be.

Yet existing cryptocurrencies like Bitcoin and Ethereum weren’t properly engineered to scale to be a medium of exchange. Their unanchored price was susceptible to huge and unpredictable swings, making it tough for merchants to accept as payment. And cryptocurrencies miss out on much of their potential beyond speculation unless there are enough places that will take them instead of dollars, and the experience of buying and spending them is easy enough for a mainstream audience. But with Facebook’s relationship with 7 million advertisers and 90 million small businesses plus its user experience prowess, it was well-poised to tackle this juggernaut of a problem.

Now Facebook wants to make Libra the evolution of PayPal . It’s hoping Libra will become simpler to set up, more ubiquitous as a payment method, more efficient with fewer fees, more accessible to the unbanked, more flexible thanks to developers and more long-lasting through decentralization.

“Success will mean that a person working abroad has a fast and simple way to send money to family back home, and a college student can pay their rent as easily as they can buy a coffee,” Facebook writes in its Libra documentation. That would be a big improvement on today, when you’re stuck paying rent in insecure checks while exploitative remittance services charge an average of 7% to send money abroad, taking $50 billion from users annually. Libra could also power tiny microtransactions worth just a few cents that are infeasible with credit card fees attached, or replace your pre-paid transit pass.

…Or it could be globally ignored by consumers who see it as too much hassle for too little reward, or too unfamiliar and limited in use to pull them into the modern financial landscape. Facebook has built a reputation for over-engineered, underused products. It will need all the help it can get if wants to replace what’s already in our pockets.

How does Libra work?

By now you know the basics of Libra. Cash in a local currency, get Libra, spend them like dollars without big transaction fees or your real name attached, cash them out whenever you want. Feel free to stop reading and share this article if that’s all you care about. But the underlying technology, the association that governs it, the wallets you’ll use and the way payments work all have a huge amount of fascinating detail to them. Facebook has released more than 100 pages of documentation on Libra and Calibra, and we’ve pulled out the most important facts. Let’s dive in.

The Libra Association — crypto’s new oligarchy

Facebook knew people wouldn’t trust it to wholly steer the cryptocurrency they use, and it also wanted help to spur adoption. So the social network recruited the founding members of the Libra Association, a not-for-profit which oversees the development of the token, the reserve of real-world assets that gives it value and the governance rules of the blockchain. “If we were controlling it, very few people would want to jump on and make it theirs,” says Marcus.

Each founding member paid a minimum of $10 million to join and optionally become a validator node operator (more on that later), gain one vote in the Libra Association council and be entitled to a share (proportionate to their investment) of the dividends from interest earned on the Libra reserve into which users pay fiat currency to receive Libra.

The 28 soon-to-be founding members of the association and their industries, previously reported by The Block’s Frank Chaparro, include:

  • Payments: Mastercard, PayPal, PayU (Naspers’ fintech arm), Stripe, Visa
  • Technology and marketplaces: Booking Holdings, eBay, Facebook/Calibra, Farfetch, Lyft, Mercado Pago, Spotify AB, Uber Technologies, Inc.
  • Telecommunications: Iliad, Vodafone Group
  • Blockchain: Anchorage, Bison Trails, Coinbase, Inc., Xapo Holdings Limited
  • Venture Capital: Andreessen Horowitz, Breakthrough Initiatives, Ribbit Capital, Thrive Capital, Union Square Ventures
  • Nonprofit and multilateral organizations, and academic institutions: Creative Destruction Lab, Kiva, Mercy Corps, Women’s World Banking

Facebook says it hopes to reach 100 founding members before the official Libra launch and it’s open to anyone that meets the requirements, including direct competitors like Google or Twitter. The Libra Association is based in Geneva, Switzerland and will meet biannually. The country was chosen for its neutral status and strong support for financial innovation including blockchain technology.

Libra governance — who gets a vote

To join the association, members must have a half rack of server space, a 100Mbps or above dedicated internet connection, a full-time site reliability engineer and enterprise-grade security. Businesses must hit two of three thresholds of a $1 billion USD market value or $500 million in customer balances, reach 20 million people a year and/or be recognized as a top 100 industry leader by a group like Interbrand Global or the S&P.

Crypto-focused investors must have more than $1 billion in assets under management, while Blockchain businesses must have been in business for a year, have enterprise-grade security and privacy and custody or staking greater than $100 million in assets. And only up to one-third of founding members can by crypto-related businesses or individually invited exceptions. Facebook also accepts research organizations like universities, and nonprofits fulfilling three of four qualities, including working on financial inclusion for more than five years, multi-national reach to lots of users, a top 100 designation by Charity Navigator or something like it and/or $50 million in budget.

The Libra Association will be responsible for recruiting more founding members to act as validator nodes for the blockchain, fundraising to jump-start the ecosystem, designing incentive programs to reward early adopters and doling out social impact grants. A council with a representative from each member will help choose the association’s managing director, who will appoint an executive team and elect a board of five to 19 top representatives.

Each member, including Facebook/Calibra, will only get up to one vote or 1% of the total vote (whichever is larger) in the Libra Association council. This provides a level of decentralization that protects against Facebook or any other player hijacking Libra for its own gain. By avoiding sole ownership and dominion over Libra, Facebook could avoid extra scrutiny from regulators who are already investigating it for a sea of privacy abuses as well as potentially anti-competitive behavior. In an attempt to preempt criticism from lawmakers, the Libra Association writes, “We welcome public inquiry and accountability. We are committed to a dialogue with regulators and policymakers. We share policymakers’ interest in the ongoing stability of national currencies.”

The Libra currency — a stablecoin

A Libra is a unit of the Libra cryptocurrency that’s represented by a three wavy horizontal line unicode character ≋ like the dollar is represented by $. The value of a Libra is meant to stay largely stable, so it’s a good medium of exchange, as merchants can be confident they won’t be paid a Libra today that’s then worth less tomorrow. The Libra’s value is tied to a basket of bank deposits and short-term government securities for a slew of historically stable international currencies, including the dollar, pound, euro, Swiss franc and yen. The Libra Association maintains this basket of assets and can change the balance of its composition if necessary to offset major price fluctuations in any one foreign currency so that the value of a Libra stays consistent.

The name Libra comes from the word for a Roman unit of weight measure. It’s trying to invoke a sense of financial freedom by playing on the French stem “Lib,” meaning free.

The Libra Association is still hammering out the exact start value for the Libra, but it’s meant to be somewhere close to the value of a dollar, euro or pound so it’s easy to conceptualize. That way, a gallon of milk in the U.S. might cost 3 to 4 Libra, similar but not exactly the same as with dollars.

The idea is that you’ll cash in some money and keep a balance of Libra that you can spend at accepting merchants and online services. You’ll be able to trade in your local currency for Libra and vice versa through certain wallet apps, including Facebook’s Calibra, third-party wallet apps and local resellers like convenience or grocery stores where people already go to top-up their mobile data plan.

The Libra Reserve — one for one

Each time someone cashes in a dollar or their respective local currency, that money goes into the Libra Reserve and an equivalent value of Libra is minted and doled out to that person. If someone cashes out from the Libra Association, the Libra they give back are destroyed/burned and they receive the equivalent value in their local currency back. That means there’s always 100% of the value of the Libra in circulation, collateralized with real-world assets in the Libra Reserve. It never runs fractional. And unliked “pegged” stable coins that are tied to a single currency like the USD, Libra maintains its own value — though that should cash out to roughly the same amount of a given currency over time.

When Libra Association members join and pay their $10 million minimum, they receive Libra Investment Tokens. Their share of the total tokens translates into the proportion of the dividend they earn off of interest on assets in the reserve. Those dividends are only paid out after Libra Association uses interest to pay for operating expenses, investments in the ecosystem, engineering research and grants to nonprofits and other organizations. This interest is part of what attracted the Libra Association’s members. If Libra becomes popular and many people carry a large balance of the currency, the reserve will grow huge and earn significant interest.

The Libra Blockchain — built for speed

Every Libra payment is permanently written into the Libra Blockchain — a cryptographically authenticated database that acts as a public online ledger designed to handle 1,000 transactions per second. That would be much faster than Bitcoin’s 7 transactions per second or Ethereum’s 15. The blockchain is operated and constantly verified by founding members of the Libra Association, which each invested $10 million or more for a say in the cryptocurrency’s governance and the ability to operate a validator node.

When a transaction is submitted, each of the nodes runs a calculation based on the existing ledger of all transactions. Thanks to a Byzantine Fault Tolerance system, just two-thirds of the nodes must come to consensus that the transaction is legitimate for it to be executed and written to the blockchain. A structure of Merkle Trees in the code makes it simple to recognize changes made to the Libra Blockchain. With 5KB transactions, 1,000 verifications per second on commodity CPUs and up to 4 billion accounts, the Libra Blockchain should be able to operate at 1,000 transactions per second if nodes use at least 40Mbps connections and 16TB SSD hard drives.

Transactions on Libra cannot be reversed. If an attack compromises over one-third of the validator nodes causing a fork in the blockchain, the Libra Association says it will temporarily halt transactions, figure out the extent of the damage and recommend software updates to resolve the fork.

Transactions aren’t entirely free. They incur a tiny fraction of a cent fee to pay for “gas” that covers the cost of processing the transfer of funds similar to with Ethereum. This fee will be negligible to most consumers, but when they add up, the gas charges will deter bad actors from creating millions of transactions to power spam and denial-of-service attacks. “We’ve purposely tried not to innovate massively on the blockchain itself because we want it to be scalable and secure,” says Marcus of piggybacking on the best elements of existing cryptocurrencies.

Currently, the Libra Blockchain is what’s known as “permissioned,” where only entities that fulfill certain requirements are admitted to a special in-group that defines consensus and controls governance of the blockchain. The problem is this structure is more vulnerable to attacks and censorship because it’s not truly decentralized. But during Facebook’s research, it couldn’t find a reliable permissionless structure that could securely scale to the number of transactions Libra will need to handle. Adding more nodes slows things down, and no one has proven a way to avoid that without compromising security.

That’s why the Libra Association’s goal is to move to a permissionless system based on proof-of-stake that will protect against attacks by distributing control, encourage competition and lower the barrier to entry. It wants to have at least 20% of votes in the Libra Association council coming from node operators based on their total Libra holdings instead of their status as a founding member. That plan should help appease blockchain purists who won’t be satisfied until Libra is completely decentralized.

Move coding language — for moving Libra

The Libra Blockchain is open source with an Apache 2.0 license, and any developer can build apps that work with it using the Move coding language. The blockchain’s prototype launches its testnet today, so it’s effectively in developer beta mode until it officially launches in the first half of 2020. The Libra Association is working with HackerOne to launch a bug bounty system later this year that will pay security researchers for safely identifying flaws and glitches. In the meantime, the Libra Association is implementing the Libra Core using the Rust programming language because it’s designed to prevent security vulnerabilities, and the Move language isn’t fully ready yet.

Move was created to make it easier to write blockchain code that follows an author’s intent without introducing bugs. It’s called Move because its primary function is to move Libra coins from one account to another, and never let those assets be accidentally duplicated. The core transaction code looks like: LibraAccount.pay_from_sender(recipient_address, amount) procedure.

Eventually, Move developers will be able to create smart contracts for programmatic interactions with the Libra Blockchain. Until Move is ready, developers can create modules and transaction scripts for Libra using Move IR, which is high-level enough to be human-readable but low-level enough to be translatable into real Move bytecode that’s written to the blockchain.

The Libra ecosystem and the Move language will be completely open to use and build, which presents a sizable risk. Crooked developers could prey on crypto novices, claiming their app works just the same as legitimate ones, and that it’s safe because it uses Libra. But if consumers get ripped off by these scammers, the anger will surely bubble up to Facebook. Yet still, Calibra’s head of product tells me, “There are no plans for the Libra Association to take a role in actively vetting [developers],” Calibra’s head of product Kevin Weil tells me.

Even though it’s tried to distance itself sufficiently via its subsidiary Libra and the association, many people will probably always think of Libra as Facebook’s cryptocurrency and blame it for their woes.

Read our full story on the dangers of Libra’s unvetted developer platform

Libra incentives — rewarding early businesses

The Libra Association wants to encourage more developers and merchants to work with its cryptocurrency. That’s why it plans to issue incentives, possibly Libra coins, to validator node operators who can get people signed up for and using Libra. Wallets that pull users through the Know Your Customer anti-fraud and money laundering process or that keep users sufficiently active for over a year will be rewarded. For each transaction they process, merchants will also receive a percentage of the transaction back.

Businesses that earn these incentives can keep them, or pass some or all of them along to users in the form of free Libra tokens or discounts on their purchases. This could create competition between wallets to see which can pass on the most rewards to their customers, and thereby attract the most users. You could imagine eBay or Spotify giving you a discount for paying in Libra, while wallet developers might offer you free tokens if you complete 100 transactions within a year.

“One challenge for Spotify and its users around the world has been the lack of easily accessible payment systems – especially for those in financially underserved markets,” Spotify’s Chief Premium Business Officer Alex Norström writes. “In joining the Libra Association, there is an opportunity to better reach Spotify’s total addressable market, eliminate friction and enable payments in mass scale.”

This savvy incentive system should massively help ratchet up Libra’s user count without dictating how businesses balance their margins versus growth. Facebook also has another plan to grow its developer ecosystem. By offering venture capital firms like Andreessen Horowitz and Union Square Ventures a portion of the reserve interest, they’re motivating to fund startups building Libra infrastructure.

Using Libra

So how do you actually own and spend Libra? Through Libra wallets like Facebook’s own Calibra and others that will be built by third-parties, potentially including Libra Association members like PayPal. The idea is to make sending money to a friend or paying for something as easy as sending a Facebook Message. You won’t be able to make or receive any real payments until the official launch next year, though, but you can sign up for early access when it’s ready here.

None of the Libra Association members agreed to provide details on what exactly they’ll build on the blockchain, but we can take Facebook’s Calibra wallet as an example of the basic experience. Calibra will launch alongside the Libra currency on iOS and Android within Facebook Messenger, WhatsApp and a standalone app. When users first sign up, they’ll be taken through a Know Your Customer anti-fraud process where they’ll have to provide a government-issued photo ID and other verification info. They’ll need to conduct due diligence on customers and report suspicious activity to the authorities.

From there you’ll be able to cash in to Libra, pick a friend or merchant, set an amount to send them and add a description and send them Libra. You’ll also be able to request Libra, and Calibra will offer an expedited way of paying merchants by scanning your or their QR code. Eventually it wants to offer in-store payments and integrations with point-of-sale systems like Square.

The Libra Association’s e-commerce members seem particularly excited about how the token could eliminate transaction fees and speed up checkout. “We believe blockchain will benefit the luxury industry by improving IP protection, transparency in the product life cycle and — as in the case of Libra — enable global frictionless e-commerce,” says FarFetch CEO Jose Neves.

Privacy — at least from Facebook

Facebook CEO Mark Zuckerberg explained some of the philosophy behind Libra and Calibra in a post today. “It’s decentralized — meaning it’s run by many different organizations instead of just one, making the system fairer overall. It’s available to anyone with an internet connection and has low fees and costs. And it’s secured by cryptography which helps keep your money safe. This is an important part of our vision for a privacy-focused social platform — where you can interact in all the ways you’d want privately, from messaging to secure payments.”

By default, Facebook won’t import your contacts or any of your profile information, but may ask if you wish to do so. It also won’t share any of your transaction data back to Facebook, so it won’t be used to target you with ads, rank your News Feed, or otherwise earn Facebook money directly. Data will only be shared in specific instances in anonymized ways for research or adoption measurement, for hunting down fraudsters or due to a request from law enforcement. And you don’t even need a Facebook or WhatsApp account to sign up for Calibra or to use Libra.

“We realize people don’t want their social data and financial data commingled,” says Marcus, who’s now head of Calibra. “The reality is we’ll have plenty of wallets that will compete with us and many of them will not be in social, and if we want to successfully win people’s trust, we have to make sure the data will be separated.”

In case you are hacked, scammed or lose access to your account, Calibra will refund you for lost coins when possible through 24/7 chat support because it’s a custodial wallet. You also won’t have to remember any long, complex crypto passwords you could forget and get locked out from your money, as Calibra manages all your keys for you. Given Calibra will likely become the default wallet for many Libra users, this extra protection and smoother user experience is essential.

For now, Calibra won’t make money. But Calibra’s head of product Kevin Weil tells me that if it reaches scale, Facebook could launch other financial tools through Calibra that it could monetize, such as investing or lending. “In time, we hope to offer additional services for people and businesses, such as paying bills with the push of a button, buying a cup of coffee with the scan of a code or riding your local public transit without needing to carry cash or a metro pass,” the Calibra team writes. That makes it start to sound a lot like China’s everything app WeChat.

A global coin

Facebook got one thing right for sure: Today’s money doesn’t work for everyone. Those of us living comfortably in developed nations likely don’t see the hardships that befall migrant workers or the unbanked abroad. Preyed on by greedy payday lenders and high-fee remittance services, targeted by muggers and left out of traditional financial services, the poor get poorer. Libra has the potential to get more money from working parents back to their families and help people retain credit even if they’re robbed of their physical possessions. That would do more to accomplish Facebook’s mission of making the world feel smaller than all the News Feed Likes combined.

If Facebook succeeds and legions of people cash in money for Libra, it and the other founding members of the Libra Association could earn big dividends on the interest. And if suddenly it becomes super quick to buy things through Facebook using Libra, businesses will boost their ad spend there. But if Libra gets hacked or proves unreliable, it could cost lots of people around the world money while souring them on cryptocurrencies. And by offering an open Libra platform, shady developers could build apps that snatch not just people’s personal info like Cambridge Analytica, but their hard-earned digital cash.

Facebook just tried to reinvent money. Next year, we’ll see if the Libra Association can pull it off. It took me 4,000 words to explain Libra, but at least now you can make up your own mind about whether to be scared of Facebook crypto.

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Google Assistant comes to Waze navigation app

Posted by | Android, Android Auto, Apps, Assistant, automotive, computing, Google, Google-Maps, Lyft, smartphones, Software, TC, Transportation, Uber, United States, waze | No Comments

Ever since Google acquired Waze back in 2013, features from each have been slowly making their way back and forth between it and Google Maps — and today Waze gets a big upgrade with Google Assistant integration, which means you can use the smart voice companion within the app.

Google Assistant in Waze will provide access to your usual Assistant features, like playback of music and podcasts, but it’ll also offer access to many Waze-specific abilities, including letting you ask it to report traffic conditions, or specifying that you want to avoid tolls when routing to your destination.

Google has done a good job of rolling out support for Assistant in its own Android Auto in-car software, and even brought it to Google Maps on Apple’s competing CarPlay system earlier this year. The benefits of having Assistant work natively within Waze are many, but the number one might be its potential to reduce distractions while on the road.

Waze remains a top choice among drivers, and anecdotally most Uber and Lyft drivers I encounter still swear by its supremacy over the competition, including Google’s other own-branded Maps solution.

Google Assistant will be available via a rollout starting today in the U.S., in English only to start and on Android smartphones. Expect that availability to expand over time.

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Uber eats Uber Eats, embedding it in the main app

Posted by | Apps, Collaborative Consumption, food, Mobile, Startups, TC, Transportation, Uber, Uber Eats | No Comments

Uber’s best hope to beat all its ride sharing and food delivery competitors is that it does both. Through cross-promotion, it can combine activities people might only do a few times per week or month into a product they open daily.

Uber CEO Dara Khosrowshahi said cryptically on the company’s first earnings call last month that “Suffice it to say we are starting to experiment in ways in which we can upsell our ride customers to Eats deals in a way that — you know, to be plain spoken — isn’t annoying . . . I will tell you that we are very, very early in the stages of exploring the many, many ways in which our Ride business can help continue to build our Eats business and vice versa by the way . . . I don’t want to give away too much.”

But TechCrunch has discovered that specifically, Uber is starting to make a web view of Uber Eats accessible from its main app. A tipster in Boston first clued us in to the feature and now Uber confirms that it’s merging a fully functional web version of Uber Eats into its ride-hailing product. Uber quietly began rolling out a pilot of the merged app in late April. Uber Eats app will remain available as a standalone app.

The move could give Uber a customer acquisition and retention edge on single-product competitors like Lyft or DoorDash, while helping it keep up with multi-product peers like Careem and Bolt (which recently added food delivery), and its biggest global foe Didi from China which just launched food delivery in Uber stronghold Mexico. Combining functionality means Uber’s ride hailing customers could see a promotion for Eats and instantly try it without downloading a new app as their tummy rumbles. It could also get the 50% of Eats customers who don’t ride in Ubers to try it for transportation.

“We’re rolling out a new way to order Eats directly in the Uber app on Android (we’ve already been experimenting on iOS)” an Uber spokesperson tells me. “This cross-promotion gives riders who are new to Eats a seamless way to order a meal via a webview instead of opening up the App Store for download.”

The merged app is now available to all iOS users in cities where Uber doesn’t offer bikes and scooters that already clutter the interface of its car service app such as SF, LA, and NYC. The Android version is out to 17% of riders in Uber Eats’ 500 other markets with the goal of the cross-promotional tool being available to all riders outside of micromobility cities soon.

“We believe our platform model allows us to acquire, engage and retain customers with the cost, as well as efficiency and effectiveness advantage over our rivals, typically monoline competitors” Khosrowshahi said on the earnings call. “What we found is that with Rides and Eats . . . we are seeing early signal where essentially you can have very little if any cannibalization of a Ride and throw a significant amount of potential demand onto the Eats side.”

The CEO also mentioned Uber’s loyalty and subscription programs are vital to cross-promotion. Its Uber Rewards that rolled out in January earns users points for both rides and food orders, and higher reward tiers score users free Eats deliveries that could get them hooked on the convenience. And last month, TechCrunch broke the news of Uber prototyping a $9.99 Uber Eats Pass subscription that offers unlimited free Eats deliveries.

“Really what we are looking to do is significantly increase the percentage of our MAPCs [monthly active platform consumers] that use both products [ride-hailing and Eats] and when we see customers using more than one product, their engagement with the platform more than doubles” Khosrowshahi concluded on the call. “So not only does engagement with Uber increase, but the engagement with our individual products increases as well, so it’s kind of a win, win, win.”

Uber’s market is all about lifetime value. If it can lock users in now, it could earn a fortune off them in the decades to come. That’s why it’s spending so much on marketing and expansion now even if it means racking up earnings losses. But its best (and cheapest) marketing channel is likely cross-promotion through the apps it’s already gotten people to install.

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Daily Crunch: Uber will deactivate low-rated riders

Posted by | Apps, Daily Crunch, Mobile, Uber | No Comments

The Daily Crunch is TechCrunch’s roundup of our biggest and most important stories. If you’d like to get this delivered to your inbox every day at around 9am Pacific, you can subscribe here.

1. Uber will start deactivating riders with low ratings

Uber drivers have been able to rate their passengers before this, but those passengers were never really at risk of deactivation — until now. In a blog post, Uber’s Kate Parker said that while only “a small number of riders” should be affected, “it’s the right thing to do.”

The company isn’t announcing a specific rating cutoff. Instead, it says it will deactivate users who fall significantly below a city’s average, after “several notifications and opportunities to improve his or her rating.”

2. Huawei files motion to challenge sweeping US ban, calling it ‘not normal’

The Chinese hardware giant has filed a motion for summary judgement that questions the constitutionality of the section of the National Defense Authorization Act that the Trump administration used to halt imports.

3. Flipboard hacks prompt password resets for millions of users

Hackers stole usernames, email addresses, passwords and account tokens for third-party services. According to Flipboard, “not all” users’ account data were involved in the breaches, but the company declined to say how many users were affected.

4. Amazon just launched a $90, 5.5-inch Echo Show

The Echo Show 5 (that’s “five” for inches) doesn’t replace any existing Amazon smart screen, even though the price point will no doubt make many think twice about the $130 Spot.

5. Talkspace picks up $50 million Series D

Talkspace launched back in 2012 with a mission to make therapy accessible to as many people as possible. The platform allows users to pay a subscription fee for unlimited messaging with one of the company’s 5,000 healthcare professionals.

6. NYC subway riders will be able to swipe in with Apple Pay starting Friday

Apple Pay is hitting select subway stations this Friday, May 31. New Yorkers will then be able to swipe their iPhones or Apple Watches to catch a ride.

7. Q&A with J Crowley, Head of Product at Airbnb Lux, on what makes a great PM

Crowley has run product at three big-name companies: Foursquare/Swarm, Blue Apron and now Airbnb. (Extra Crunch membership required.)

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Leak reveals Uber’s $9.99 unlimited delivery Eats Pass

Posted by | Apps, food, food delivery, Mobile, payments, postmates unlimited, TC, Transportation, Uber, Uber Eats Pass | No Comments

What’s the cord-cutting equivalent to ditching your kitchen? Uber’s upcoming subscription to unlimited free food delivery. Uber is preparing to launch the $9.99 per month Uber Eats Pass, according to code hidden in Uber’s Android app.

The subscription would waive Uber’s service fee that’s typically 15% of your order cost. Given that’s often $5 or more, users stand to save a lot if they order in frequently. But Uber could still earn money on menu item markups, cover costs with a flat order fee that protects against someone ordering a single taco, and, most importantly, build loyalty and scale at a time of intense food delivery competition.

The Uber Eats Pass was first spotted by Jane Manchun Wong, the notorious reverse-engineering specialist who’s become a frequent TechCrunch tipster. She managed to generate screenshots from Uber’s Android app code that reveals a prototype of the feature. “Get free delivery, any restaurant, any time,” it says, showing the amount of money you could save or already saved.

An Uber spokesperson did not dispute the legitimacy of the findings and told TechCrunch, “We’re always thinking about new ways to enhance the Eats experience.” They declined to provide further details, which could hint that a launch is imminent but some details are still subject to change. For now we don’t know exactly which perks come with an Eats Pass or where it will be launching first.

At $9.99 per month, the Uber Eats Pass would cost the same and work similarly to Postmates Unlimited and DoorDash DashPass. If they all seem like good deals, you see why they’re less about immediate revenue and more about customer lock-in. You’re a lot less likely to order GrubHub or Caviar if you’ve already pre-paid to cover your Uber Eats delivery costs. And whichever apps emerge from this battle will have instituted the scale and steady behavior to raise prices or just enjoy large lifetime value from each subscriber.

Exploring new business opportunities could help perk up Uber’s share price, which closed at $41.50 today, two weeks after IPOing at an opening price of $42. There are fears that intense competition across both ridesharing and food delivery could make for an expensive road ahead for the newly public company. Any way it can gain an edge on its rivals’ users from straying to them is important. The logistics giant is already experimenting with allowing restaurants to offer discounts in exchange for promoted placement in the app, which is the first step to Uber becoming an ads company, where businesses pay for extra exposure.

If Uber combined Eats Pass with its car service subscription Ride Passes, you have the foundation for a sort of Uber Prime experience — one where you pay an upfront subscription fee that scores you perks and discounts but also makes you likely to spend a lot more on Uber. That bundle could be even more central to Uber than Amazon, which has few direct rivals in the west. People will need to eat and get around for the foreseeable future. Subsidizing loyalty now could be costly in the short-term, but poise Uber for years of lucrative business down the line.

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