Uber understands supply and demand, it’s sometimes-complaining customers don’t.
And the guy who really doesn’t get it is Vivek Wadhwa:
“My worry about a lot of these inventions that Silicon Valley comes up with is that they’re geared toward the rich,” says Vivek Wadhwa, an academic and columnist who writes frequently about the tech industry and inequality. Wadhwa took to Twitter recently to complain when he found that an Uber ride from San Francisco International Airport to his home in Menlo Park would have cost nearly three times the usual rate.
But Uber’s CEO does, and responds (not directly) to Wadhwa:
If Uber can truly make itself the most reliable way to get around, its popularity may eventually end up forcing prices down overall. Even as a $175 SUV gets all the attention, in several cities Uber is aggressively pushing its Uber X service, where drivers in their own private vehicles offer rides at rates competitive to regular taxis. In San Francisco, Kalanick says, Uber X drivers make more money than higher-priced Uber limo drivers. The reason, he says, is that more rides trump higher fares.
“What you’re going to start seeing from us is you’re going to start seeing surging down,” he says, referring to the appearance of dynamically discounted rates when demand is down or supply is too high. In other words, he believes Uber will end up making more money at lower prices. “That is just fundamental.”
Yes – almost every product that has survived the test of time (like food) has gone dramatically down in price as technology has advanced. Tech makes the world better for everybody. Wadhwa’s academic complaints are just that, academic and wrong, in the face of history.