Protocol Source Code: The Delivery Dream Is Dying
“Anything you want, delivered anywhere in no time flat” has been a core promise of the tech industry over the last decade. (The last couple of decades, really, but let’s not bring Kozmo and Webvan into this.) Uber and Lyft move people; DoorDash and Grubhub move food; Amazon moves toilet paper and iPhone cases. All for rock-bottom prices, at blistering speeds.
It’s a customer’s dream, but the question was always the same: Can it sustain itself once investors stop subsidizing the system? The answer increasingly seems to be no, and the latest favorite solution seems to be to charge customers more.
- Uber and Lyft prices are surging all over. Both companies are having trouble finding drivers, so they’ve spent $350 million combined on incentives … and passed on the cost to riders. One study found that the cost of a ride was up 40% over last year. The shocked “It cost HOW MUCH?” tweets are everywhere.
- Prime Shipping is under antitrust scrutiny. The most recent case against Amazon hinges in part on the fact that Amazon subsidizes two-day shipping through something like an internet-wide price-fixing scheme. “Amazon forces brands/sellers to bake the cost of Prime into their consumer price,” Matt Stoller wrote over the weekend in a widely-shared newsletter, “so it appears like Amazon offers free shipping when in reality the cost is incorporated into the consumer price.”