That’s the buzzword of the moment : “being ubered”. Since Publicis CEO Maurice Levy coined the word during an interview, there’s not a single week without a paper about it.
But what does “being ubered” really mean ? Some myths and realities.
1°) A newcomer enters a market : true
For the time being, all the known cases have been caused by newcomer. But is it the only possible way ? I don’t think so. Nature abhors a vacuum and the inertia of current players leaves a wide empty place for new players on the market. But we can also imagine a visionary leader deciding to “uber” himself. Maybe there are already unnoticed cases because they are about current players ubering themselves. Maybe some markets will never be ubered because the barrier to entry is so high that existing players will have enough time to adapt before newcomers enter.
In short : businesses are being ubered because they did not ubered themselves.
2°) The newcomer is a tech pure player: true
Don’t forget that the newcomers we’re talking about are nothing but intermediation platforms. Uber is not a transportation company and AirBnb is not an hotel chain. They applied the same model to two markets.
3°) The newcomer thinks transverse and positions itself as a service integrator: true
4°) The newcomer bets on the multitude and scale effects : true
Digital adds two things to the world we used to know : speed and scale. Everything goes faster – even become instant – and the number of people one can reach (or can be reached by or can collide) is potentially unlimited. It’s about
hyperscale businesses with huge operating leverage.
5°) The newcomer disintermediates a market : wrong
Contrary to popular beliefs, markets are not being disintermediate. Newcomers often replace existing intermediaries because of their ability to operate globally and reach a critical size. But they position themselves in other parts of the value chain, higher or lower but never in the middle.
6°) The newcomer brings monopolies down : wrong
It replaces existing ones with new ones. Its ability to operate globally even helps to establish more global monopolies. Until now taxis were local monopolies, tomorrow, uber can become a global one.
This is very well explained by french tech expert Olivier Ezratty: contrary to the startups of the years 90-2000,
today’s ones are saturated with cash [Link in french]. The reason : the will to create monopolies from the very beginning of the company. If the market is viable then the company will be nearly alone and the only globally dominating one.
7°) The newcomer “commoditize” work : true
It’s about intermediation platforms with huge operating leverage and, so, with close to zero marginal cost. The only way to become such a business is to commoditize work to write it off the fixed costs. Work becomes contingent, on demand, the employer-employee relationship disappears and one is paid only when there’s something to do. At least, if necessary. Pushed to the extreme, the business model of such company makes them rely less and less on human work
8°) The newcomer has no tangible assets : true
Uber does not owns cars, AirBnb no hotels. Their assets are their algorithms, customers, data, platform and experience.
