They have a network effect. If a car is not available or I have to wait too long then I will consider some other option. The number of cars available is a function of the number of users.
that's not a network effect, that is just supply. If the gas station runs out of gas you also go to another gas station, that doesn't mean there's a gas network effect.
There would be a network effect if them having more cars would make it much more likely for them to get even more cars, or add value in some other way beyond the fact that they have one additional driver. That is not the case.
For facebook say, it's much easier to get more users because each user themselves increases the value of the business, because the users interact. You don't care if Uber has ten thousand or ten million drivers, it does not improve the service (significantly) apart from increasing supply.
> Uber has virtually no network effects. One driver is just one more driver without any effect on other drivers or users, in contrast to say, user-driven content generation on tiktok or youtube.
How does youtube have a network effect then? Using your language, youtube has a supply of viewers and a supply of creators. More videos on youtube do not beget more videos, and likewise more viewers do not beget more viewers.
In the same way that the userbase is what gives youtube value in the eyes of the creators, the passenger base gives uber value in the eyes of the drivers.
>More videos on youtube do not beget more videos, and likewise, more viewers do not beget more viewers.
Given the virality and the way video creators interact with their audience and other video creators I don't think that statement is true. Youtube is not just a one-sided tv channel, it's also a community-driven social network which makes the network defensible.
If your favourite content creator is on youtube or twitch (or your audience if you are one) is on the same platform there's a pretty bad collective action problem to get you to move to a less popular platform.
On a ridesharing app, there's no social interaction, you don't care who drives you and every driver can easily drive for every competitor.
My favourite content creation platforms all have unique creators that I would miss, so I can't leave. Every ridesharing app I have ever used is utterly interchangeable. Not even the theoretical benefits from scale like say better service where ever noticeable.
There is absolutely a gas network effect, which is why Tesla has spend millions on building out a Supercharger network.
I prefer Lyft, and still take Uber anyway in parts of the country where there aren't enough Lyft drivers. It can make a meaningful difference in wait times. I'm also unlikely to check back later, unless I think of it.
