Uber is killing off the “instant” option in UberEats, its food-delivery service, just one month after the standalone app launched in New York City.
“In order to bring you the most exciting selection, the highest quality food, and the fastest delivery time, we’ve decided to narrow our focus,” Uber wrote in an email to Eats users in New York City on Monday. “Starting today, 4/18, we’ll no longer be offering a daily Instant Delivery lunch menu.”
The UberEats app debuted in cities across the US in mid-March, with thepromise to make “getting great food from hundreds of restaurants as easy as requesting a ride.” At launch, UberEats offered New Yorkers two different ways to order food. The first was a Seamless-like experience, in which customers could order food from any of the dozens of restaurants on the app, and Uber would facilitate the delivery.
The second was an upgraded “instant delivery” menu that featured two pre-set lunch options from a rotating group of restaurants that Uber said it would deliver in as little as 10 minutes.
To make these rapid deliveries work, instant UberEats had different logistics from its regular service. Instead of dispatching bike couriers to restaurants, Uber had its inventory for the instant menu brought to a central holding facility in Manhattan’s Midtown neighborhood every morning. Instant deliveries were also made to the curb, whereas normal UberEats orders would be brought to a user’s door.
When Uber demonstrated Eats in March a day ahead of its New York City launch, the company was clearly excited about the instant setting, which was the first option at the very top of the app. Emails that UberEats sent to users also prominently highlighted the day’s instant delivery options.
Still, it was unclear at the time exactly how the economics of instant UberEats worked. Uber, for example, said it did not purchase the food, but rather let restaurants determine how much they wanted to provide each day. The company also declined in March to provide specifics on how many Eats orders its bike couriers could deliver at a time, or per hour.
Sarah Maxwell, a spokeswoman for Uber, said the instant delivery option is only being phased out in New York City, but will still exist in all the other UberEats markets. New York UberEats users will still be able to order from the menus of more than 100 restaurants that partner with Uber in the city. Uber had offered a version of Eats in New York City similar to the instant option within its main, flagship ride-hailing app since April 2015.
Food delivery is a hot space right now, with Uber, Postmates, DoorDash, and Caviar—not to mention Seamless—all vying for consumers’ loyalties. Each of these companies is trying to make it big by applying the Uber model to lunch and dinner logistics. Each is building out a technology platform and hiring an army of independent contractors to bring food on-demand from restaurants to users.
But the actual logistics of these business have proven challenging. The New York Times reported in February that DoorDash spends north of $200 to recruit each driver. Many stopped working for the company within a year. (“Dashers by definition will always churn,” DoorDash CEO Tony Xu told Quartz in early March. “They’re people looking for flexible work.”) Late last month, DoorDash raised new funding, selling shares at a 16% discount. Postmates said in February that it planned to raise money in the first quarter, but the company hasn’t shared any news since then.
ATLANTA — A battle over background checks for Uber drivers at the world’s busiest airport comes as cities like Los Angeles and Austin, Texas, consider more thorough screenings to prevent criminals from getting behind the wheel.
Uber has objected to the Atlanta airport’s plan to use fingerprints to check criminal records of its drivers, saying its own record checks are sufficient.
But the district attorney in Uber’s hometown of San Francisco has called the ride-booking firm’s process “completely worthless” since drivers aren’t fingerprinted.
In Houston, city officials say they found that background checks without fingerprints allow criminals who have been charged with murder, sexual assault and other crimes to evade detection in a variety of ways.
Atlanta’s city council on Wednesday is set to consider the airport’s plan for screening drivers for Uber, Lyft and other ride-booking firms when proposed new rules go before the council’s transportation committee.
Uber has agreements with more than 50 U.S. airports, none of which require the fingerprint-based background checks being proposed by Atlanta’ s airport, the company said in a statement. Those airports include major air hubs in Denver; Los Angeles; Memphis, Tennessee; Charlotte, North Carolina; and Salt Lake City, Utah.
But New York City does fingerprint drivers, and the mayor of Los Angeles this month asked state regulators to allow his city to do so as well.
Houston, the nation’s fourth-largest city, was among the first in the nation to require drivers for Uber and other ride-booking firms to undergo fingerprint-based background checks using the FBI’s database. Houston’s program began in November 2014, and city officials there say they’re far more thorough than any other way of checking someone’s criminal past.
“Public safety is our No. 1 priority — that’s something the city of Houston does not compromise on,” said Lara Cottingham, Houston’s deputy assistant director of administration and regulatory affairs. “That’s the reason we license any vehicle for hire.”
Since Houston’s ordinance went into effect, the city’s fingerprint-based FBI background checks have found driver applicants who have been charged with murder, sexual assault, robbery and indecent exposure, among other crimes. Those drivers had already cleared the commercial background checks used by ride-for-hire companies, according to a city report released this month.
Potential drivers can pass background checks that don’t rely on fingerprints simply by using an alias, the report found. For instance, one driver cleared by a company that does background checks for Uber underwent Houston’s fingerprint check, which turned up 24 alias names, 10 listed social security numbers and an active arrest warrant, the report states.
Companies that perform background checks for ride-hailing firms typically seek to identify counties where they’ve lived in the past, then search public records from those places, the report states. But the checks don’t search every county, creating “a huge potential gap where crimes go undetected,” the report states.
“The FBI provides the only true nationwide check,” the report states.
Uber has now been operating in Houston for more than a year, “and everything we’ve seen is that the number of drivers getting licenses continues to grow and their business continues to thrive,” Cottingham said.
However, Uber maintains that Atlanta’s plan would add “substantial, additional bureaucratic barriers for drivers,” company spokesman Bill Gibbons said. Atlanta would use the Georgia Department of Driver Services to help check the backgrounds of potential drivers, though specific details of how drivers would be screened haven’t been released.
The ride-booking firm Lyft also says Atlanta’s proposal would prove difficult.
“While the Hartsfield-Jackson staff has recognized the benefits Lyft provides, the current plan as proposed will make it extremely difficult for Lyft to operate,” Lyft said in a statement to The Associated Press.
The conflict in Atlanta is the latest in a series of disputes Uber has had over its background checks of drivers.
In December 2014, San Francisco District Attorney George Gascón and Los Angeles County District Attorney Jackie Lacey announced a lawsuit against Uber, partly over its background checks.
In Los Angeles, “registered sex offenders, a kidnapper, identity thieves, burglars, and a convicted murderer had passed Uber’s ‘industry leading’ background check,” the lawsuit states.
“Uber’s process cannot ensure that the information in the background check report is actually associated with the applicant since it does not use a unique biometric identifier such as a fingerprint,” the lawsuit adds.
Car dealers may be coming off of their biggest sales year ever, but the future for the auto industry looks murkier as the percentage of Americans with a driver’s license continues to fall.
Just 77 percent of Americans aged 16 to 44 held drivers licenses in 2014, down from 82 percent in 2008 and 92 percent in 1983. The percentage of Americans with driver’s licenses declined across every age group from 2011 to 2014,according to an analysis by Michael Sivak and Brandon Schoettle at the University of Michigan Transportation Research Institute.
Several factors have led to fewer licensed drivers, including a lack of interest among younger consumers in driving or owning a car, a general return to cities and close suburbs with reliable public transportation, a rise in telecommuting, and the advent of ride-sharing services like ZipCar and on-demand taxis like Uber. Tighter restrictions on young drivers haven’t helped either.
The introduction of driverless cars, which some industry experts say will be on roads within the next decade, promises to further reduce the share of Americans who feel the need to get a driver’s license.
The result of fewer licensed driver is that the aggregate number of miles driven has plateaued over the past decade, according to research from the Brookings Institute.
That may be bad news for automakers and the gasoline industry, but it’s good news for drivers themselves. The 2015 Urban Mobility Scorecard from the Texas A&M Transportation Institute found that drivers wasted more than 3 billion gallons of fuel and spent 7 billion extra hours sitting in traffic last year, at a cost of $160 billion, or $960 per commuter.
MUNICH — Airbus Group SE will provide helicopters to Uber Technologies Inc. for its on-demand services, the European plane maker’s chief executive said Sunday.
“It’s a pilot project, we’ll see where it goes — but it’s pretty exciting,” Airbus Chief Executive Tom Enders said in an interview with The Wall Street Journal at the Digital Life Design conference in Munich, Germany.
Enders said he hoped the cost of ordering a helicopter via Uber’s app would fall over time. The project will launch in several weeks, he said.
Uber, which runs a smartphone app service that allows people to hail cars for trips, recently expanded its offerings to include other forms of transportation, including on-demand boats.
Written by Rebecca Blumenstein and Natalia Drozdiak of MarketWatch
The top executives of many a corporate giant must feel like the fictional character Gulliver, waking up to find themselves under attack from modern-day Lilliputians, small start-up companies which overwhelm their established rivals with new technologies.
The old powers of market incumbents – massive scale, control over distribution, brand power, millions of customer relationships – are no longer seen as the obstacles they once were to agile rivals with innovative business models.
A new survey finds business leaders believe four out of 10 top-ranked companies in their industries worldwide won’t survive the next five years.
They blame the accelerating change in technology, shifting business models and a need to merge to cut costs in order to ensure they don’t become footnotes in someone else’s corporate history.
“Not just lone companies, but entire industries are being side-swiped by these effects,” said James Macaulay, co-author of the study, which polled 941 business leaders from a dozen industries in the world’s 13 biggest economies.
“Digital disruption now has the potential to overturn incumbents and reshape markets faster than perhaps any force in history,” the survey states. The report can be found at http://bit.ly/1IyV1cK
The survey was conducted by a research center at top-ranked Swiss business school IMD, the International Institute for Management Development, with backing from Internet equipment maker Cisco, where Macaulay works as a consultant.
INDUSTRIES AT RISK
Industries with the highest number of top-rated companies at risk were hospitality/travel, media and entertainment, retail, financial services and consumer goods/manufacturing, in that order, the survey showed.
Meanwhile, industries which still largely deliver physical products or services such as pharmaceuticals, utilities and the oil and gas sectors were rated the least likely to be disrupted.
Michael Wade, another co-author of the survey, said there were some things software could not replace. “Consumers are still unlikely to take an app if they get a headache,” joked Wade, a professor of strategy at the Lausanne-based IMD business school.
But even for industries such as pharmaceuticals, where regulatory protections, high capital costs and complex production processes still rule, Wade said new threats are coming from start-ups analyzing “big data” to offer a personalized approach to medicine, for example.
Meanwhile in travel e-commerce aggregators have taken millions of customers from direct bookings with hotels and airlines already struggling with a decade of decline in business travel amid the economic and structural challenges.
“Disruptive players are coming from out of nowhere,” says Macaulay. “Now it’s individuals who want to rent their homes and vehicles,” he said, referring to home rental service Airbnb, office-sharing firm LiquidSpace and similar “sharing economy” start-ups.
Karl Ulrich Garnadt, chief executive of the German Airlines division of Deutsche Lufthansa AG, told venture investors in Berlin this month that his industry still spends too much time worrying about direct competitors in Asia or the Mideast.
He noted how the industry missed the rise of mobile travel apps, the top dozen of which now collectively have a valuation around 88 billion euros ($99 billion), while the market capitalization of Lufthansa, Europe’s largest airline group, has shrunk to 5.5 billion euros from double that a decade ago.
“Today we are too limited in our thinking. We need to widen our horizon, we need to think like the customer,” the airline industry veteran said.
Toward that end, Lufthansa is seeking ways to woo back customers who expect them to deliver more than boarding passes to their mobile phones. With free on-board Wi-Fi soon to be available on every plane, he wants flight attendants to use new apps to help frequent travelers make new travel bookings in mid-air.
In banking big lenders are now all at giving board-level attention to the rapid growth of “fintech” start-ups in markets from mortgage-lending to wealth management to small business loans.
In an era of cloud computing and services delivered to smartphones, fintech start-ups have no need to duplicate the retail branch networks that tied customers to banks. And new players aren’t saddled with making heavy investments in creaky, decades-old back-office banking systems.
“Lending remains pretty much an archaic process for banks, largely based on paper forms that are designed to give customers a poor experience,” said Martin McPhee, a senior vice president at Cisco who heads the company’s consulting arm.
“Research shows that four out of five banking customers will happily leave their banks for a better customer experience,” he said.
HUNT OR BE HUNTED
In corporate circles, the most common sobriquet for these digital threats is Google or, less frequently, Amazon.
But, depending on the industry, the big threat goes by different names: for automakers and transport companies, it is Tesla, the luxury electric car company, or Uber, the online taxi service. For hotels and airlines, it’s Airbnb or Trivago, now majority owned by Expedia.
Tesla has also hit the radar of utilities with its announcement in April on its “energy storage” business, which aims to produce batteries capable of solving the elusive problem of storing electrical energy produced at optimum times for use at other times.
“Everyone thought (Tesla founder) Elon Musk was building a car company, but now we find he is building an alternative energy company,” McPhee said.
There is also mounting wave of digitally inspired, cross-border mergers, stepped-up corporate venture funding and a willingness to place bigger bets on risky business models that can undermine a company’s existing activities.
BMW-owned British carmaker Mini said this week customers would in the future be able to offer their private vehicles for car-sharing, mindful of a trend amongst younger drivers to not have their own cars.
The challengers offer massive improvements in how customers use the products or services of established businesses. They combine that with finding ways to slash costs and enter markets without investing heavily to own physical assets or distribution infrastructure, says McPhee.
Uber, the online taxi-hailing service is now applying similar strategies to sign up drivers to deliver everything from groceries to heavy equipment, in a challenge to logistics giants like FedEx and UPS.
McPhee notes the historical parallel to what occurred after the advent of the Web in the mid 1990s: Just 25 percent of the Fortune 100 top U.S. companies were still in existence 15 years later.
Entrepreneurship comes with both high ambitions and risks. After all, 9 out of 10 of them fail.
Before these big name self-starters created a household name for their companies, many of them faced failure with their first startups.
Some were young and wanted to make some extra money on the side. Some knew when it was time to say goodbye and move on to their next dream project.
And, in many ways, these early bumps should be viewed in a positive light. After all, if Google co-founder Larry Page had continued to pursue his saxophone music career, your current home page might not exist.
These are the strange successes and bittersweet failures of some of the biggest names in tech.
1. Elon Musk attempted to convert a frat house into an underground nightclub.
When the magnate of Tesla Motors and SpaceX wasn’t studying up for his business or physics degrees, he threw ragers at a multi-bedroom apartment that he managed to turn into a nightclub.
Musk, along with his friend Adeo Ressi, did this to earn extra cash and become more acquainted with the University of Pennsylvania scene as they were transfer students. They even hired bouncers and people to be in charge of clean-up.
On Sundays, Musk would wind down and watch The Simpsons on his run-down TV.
2. College-aged Larry Page of Google created business plans for a company that made software music synthesizers.
While growing up, Page loved music and would play the saxophone and study music composition. When the Google founder was still attending the University of Michigan, he created a business plan for a company that would use electronic music synthesizers built from software. The difficulties he encountered with the software while trying to get it to operate in real-time irked him, however.
Page told Fortune , “It’s amazing to the extent I think that modern operating systems are terrible at being real-time. If you think about it from a music point of view, if you’re a percussionist, you hit something, it’s got to happen in milliseconds, fractions of a second.”
Page’s obsession for speed was a key element of the Google platform, as he pushed for his engineers to cut down every millisecond of lag in search results.
3. Before Travis Kalanick created Uber, his search engine was sued by the Motion Picture Association of America.
Kalanick, along with five other students from UCLA’s computer science department, founded a multimedia search engine called Scour in 1997. It was successful at first, even attracting the investment of former Disney president Michael Ovitz.
To compete with Napster, a former peer to peer music service, Kalanick and his friends jump started a company called Scour Exchange. The file exchange service allowed users to trade videos and video files, rustling the MPAA’s feathers, which then alleged copyright infringement.
Scour died soon after because it failed to raise enough funds to continue its operations. The whopping $250 billion lawsuit charge forced Kalanick and his buddies to file for bankruptcy .
4. Elizabeth Holmes, the CEO of Theranos, sold C++ packages to Chinese universities.
Homes was concerned with how Chinese universities often lacked information technology, as she lived in China at the time due to her father’s frequent business trips.
So before the youngest self-made female billionaire even flew over to California to start her Stanford education, Holmes sold C++ compilers to Chinese universities . At this point, Holmes had already been dipping her toes with a variety of programming languages, and wanted to amp up the tech used by Chinese education.
Thanks to her fluency in Mandarin, Holmes worked in a lab at the Genome Institute in Singapore. From there, she was inspired to draft up a patent that would eventually lead to Theranos, a health tech company that develops solutions for laboratory diagnostic tests that are mainly blood-related.
5. Walt Disney and his brother created an animation series that was forced to shut down.
In 1923, the Disney brothers created the “Alice Comedies,” which were spin-offs of the Alice in Wonderland story, in their uncle’s garage.
Disney and his brother, Roy, made their first films for four years, and then created a new character called Oswald the Lucky Rabbit. After making 26 episodes, the Disney brothers found out that their distributor had gone behind their backs and asked animators to make the Oswald cartoon without consulting Disney.
Upon reviewing his contract, Disney realized that the distributor owned the rights to the cartoon — a painful lesson for the entrepreneur. But he had the last laugh— Disney World is currently valued at $35 billion.
6. Mark Zuckerberg created the notorious Facemash, the pre-Tinder app of today
The Facebook founder ran the site by putting photos of two people of the same gender side by side. The user would then vote on the “hotter” person and then Facemash would present a final ranking . In just one day, 450 people had already visited the site and voted on people’s faces over 22,000 times.
Immediately, criticism ensued. The Harvard student newspaper deemed his site improper, and Zuckerberg was accused of breaching security, violating copyrights, and violating individual privacy by Harvard’s administrative board.
Zuckerberg took the website down, admitting that “issues about violating people’s privacy don’t seem to be surmountable. I’m not willing to risk insulting anyone.”
On a less controversial note, high-school Zuckerberg built the Synapse Media Player, a machine that adapted to a music-lover’s listening habits, which was ranked 3 stars out of 5 in PC Magazine. It generated songs in a playlist according to someone’s taste, much like the discovery function of Spotify.
7. LinkedIn’s Reid Hoffman founded an ‘overeager’ dating site
Before LinkedIn, Hoffman tried his hand at building another type of networking site in 1997: the “overeager” dating site called SocialNet. The ambitious concept included professional networking along with finding you a date, someone to room with, or even tennis partners.
In a previous interview with Business Insider, Hoffman talked about the learning experience of it all, saying, “if you’re not embarrassed by your version one release, you released it too late”.
Even though Hoffman creates products which connect people, he was a self-described “loner” in high school with three to five friends in his circle.
He left SocialNet after tensions in the strategy board and then joined the PayPal Mafia, the alumni of the online payment service who started their own tech companies. This was when Hoffman’s passion project became LinkedIn. SocialNet no longer exists.
8. Alexis Ohanian and Steve Huffman of Reddit made a geeky company called “bread pig.”
Right after he graduated from the University of Virginia, Alexis Ohanian and Steve Huffman co-founded the online news forum Reddit.
Their other lesser-known project was “born at an unknown point in 2005” before reddit exploded online. While Huffman and Ohanian searched for a domain for Reddit, they came across breadpig.com and impulsively purchased it. Huffman envisioned the flying animal with two loaves of bread for wings, and the mythical beast became the beloved symbol of their business.
Ohanian and Huffman waited for breadpig.com to stop being treated as a spam page for pig supplies and bread makers for a year.
Breadpig “sidekick-for-hire” continues to sell an assortment of eccentric objects, and is still up and running, with Ohanian as the Founder and Chief Swine Defender.
9. Richard Branson quit school when he was 16 to start a magazine that was doomed for failure.
Before Branson founded the multinational VC conglomerate that is the Virgin Group, he tried to start a magazine simply called “Student”. Branson hoped that the pages would be filled with opinions of activists and inspire young people everywhere.
He snagged some interviews with big names like French philosopher Jean-Paul Sartre and poet Robert Graves, but the magazine wasn’t profitable.
Branson went along with a passing idea to mail records to people at discounted prices. He used Student to advertise for his new business, and then renovated a shoe shop to a discount record store. Everyone Branson hired to work at his store was inexperienced — a “virgin at business” — hence the title which eventually spawned a $5 billion enterprise.
10. Investor and philanthropist Warren Buffet used to place pinball machines in barber shops.
While other children were frolicking at a playground, Buffett was already a young entrepreneur — he sold golf balls, stamps, and delivered newspapers. He put $1,200 from this business towards 40 acres of farmland.
Buffett then shopped around for pinball machines with his friend Donald Danly during his high school years, buying one for $25 and placing it in a nearby barber’s shop. The profit-minded teen invested in more machines and eventually owned them in three different locations. The young duo made $50 a week.
He eventually sold his business, called Wilson Coin Operated Machines, to a war veteran for $1200.