Friday, 2 September 2016

Google Takes on Uber With New Ride-Share Service


Uber

Google is working towards expanding its ride sharing services in San Francisco with the aid of its Waze app. This ride sharing service could result in the shutdown of competitors and market leaders such as Uber and Lyft. Waze is an app which updates the situation of the traffic as well as provides directions for drivers in real time.

Since May this year, google has been conducting a pilot ride sharing service with the aid of Waze which helps in connecting drivers as well as passengers in the vicinity of Googles headquarters in California. Google by the end of this year ensures that Waze carpooling would be available to anyone within the Bay Area at the click of a finger on the Waze app.

On the basis of the success of the service in the Bay Area, Google will look into further expanding their services to other cities in the country. However, this may result in a downfall of Googles rivals as the prices charged by Waze are comparatively lower.

Financials 

Unlike Uber as well as its nearest rival Lyft, Google at this moment is not taking a cut of the fares of the drivers. However this does not mean that they would not make any money in the near future, it’s all thanks and praise to googles rewarding advertising business that google does not need to make a cut from the drivers fare right away. Uber on the other hand is spending drastically on subsidies for the drivers.

The fares of the services would be modest thus probably nabbing on possible Uber clientele. However this model may fail in attracting professional drivers to switch companies.At this current moment when the pilot program is being conducted, Waze charges its passengers an outer limit of 54 cents per mile without any additional booking fee. The company has mentioned that it aims to have fares low enough that discourage drivers from operating as taxi drivers.

Same, same but different? 

The main aim of Waze is to be able to connect drivers to possible passengers that are heading in the same direction while the charges are mainly only to cover the expenditures made for fuel as well as for maintenance. The business model being used by Waze is completely different from that of Uber as well as Lyft, since both Uber and Lyft function with drivers using their own cars and offering rides with the end intention of achieving a profit.

Over the last couple of years, both Google as well as Uber have been competing against each other in the transport business which has been booming. Both the firms are working on developing driverless cars. Pittsburgh is where the road tests for these driverless cars are going to be conducted by Uber in a short while. Apart from driverless cars, Uber is also working on designing its very own mapping software. While both Uber as well as Lyft have an estimated worth of billions of dollars, they are both yet to turn a profit.

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