Uber already has all the makings of a behemoth in the fledgling ride-sharing industry: An astounding $41.2 billion valuation. A larger-than-life battle-tested CEO in Travis Kalanick. The ability to strike terror in every cabbie and limo driver around the world. And a menu of services that have spawned diehard disciples from San Diego to Sao Paolo.
But it’s just the beginning. Industry analysts expect even bigger things from Uber in the coming year as the San Francisco-based company uses its cash to hire new drivers and push into new territories globally, even as it battles the old-guard taxi industry and municipal regulators who seem more anachronistic by the day.
Dan Sperling, Founding Director of the Institute of Transportation Studies at UC Davis, says that while Uber “will continue to do battle with local and state authorities, it’s pretty clear that they’ve got a very good business model, they’ve got a lot of momentum, and they’ve got a very good product that people love. They’ll figure out a way around the challenges because it’s clear they provide a valuable service. And that’ll force regulators to reassess their rules, some of which were written up years ago and make absolutely no sense today.”
As Sperling sees it, “while it’s true that taxis are way over-regulated, the answer is not to smother all the babies competing with them; the answer is to regulate the Ubers of the world better while you deregulate the taxi industry.”
And what about that $40 billion price tag? Uber and its rivals “are entering a marketplace that has seen almost no innovation in many decades,” according to Sperling, who says adding courier and food-delivery services could make Uber even more of a behemoth. “There’s a lot of pent-up demand for real-time, on-demand-type services, so there’s huge upside potential here.”
Photo: The Uber app on a smartphone. (Associated Press archives)
