New research reveals Uber's algorithmic pricing leaves drivers and passengers worse off
New research reveals Uber's algorithmic pricing leaves drivers and passengers worse off
A new study from researchers in the University of Oxford's Department of Computer Science has found that Uber's use of dynamic pricing has led to higher fares for passengers and lower earnings for drivers, while increasing Uber's share of revenue.
The study analyzed data from 258 UK Uber drivers over more than 1.5 million trips between 2016 and 2024. This revealed a significant shift when Uber introduced a dynamic pricing algorithm in 2023. Passengers now pay more per trip, but drivers' earnings have declined. Adjusted for inflation, drivers' hourly income fell from over £22 to just over £19 before operating costs, and drivers are spending more unpaid time waiting for rides than before. Uber's commission has risen from around 25% to 29% and in some cases, Uber took over half the value of the fare.
Why would it work any differently? If there’s a way for the company to make more money off both and there’s no punishment for doing so, what’s the incentive for anything else?
Yeah, my first thought was this isn't news. This is literally reporting that someone is doing their job.
It sucks that the goal in capitalism is just more money. Unions are how labor gets stuff in capitalism. Even if they aren't perfect, dont hate the player, hate the game.
has led to higher fares for passengers and lower earnings for drivers, while increasing Uber's share of revenue
Sounds like the steps 2 and 3 on the path of enshittification.
This is why on the rare occasion I even use these services, I get their contact info and just pay them directly in the future.
Look, sometimes I need a driver. Maybe I drank too much at a bar, maybe I'm coming back from the airport, I don't know. But I'll gladly pay extra to an individual knowing that they don't have to pay a corporation.
I don't use these services, but out of curiosity how has that gone for you? To and from the airport where you can give a heads up of at least a few days makes sense to me, but I always figured part of the allure was flexible scheduling and the location algorithm. I can't imagine a driver would want to give their information out and possibly get a call at like 2 am to do a pickup somewhere they aren't close to. Do they give you their general schedule and service area? Do you have a long list or do you just pay 1 or 2 well enough that they will make the trip even if they're not actually working at that time?
I live in a pretty small town so you end up getting the same drivers sometimes and then sometimes you see them around town...so in my case it is probably less weird. I guess this wouldn't really work in a bigger area.
Was this supposed to be surprising? Anyone who's been either a driver or customer with Uber over the last few years has recognized this trend. Same goes for Lyft. They opened with super-low fares to beat local cab companies and build habits. Now it's time to go back to the few local companies that were able to hold out against the "disruption".
Yeah, but Uber's shareprices are through the roof. That's their real customer, and the same for any company with shareholders by law.
Grass is green, sky is blue, and Uber is run by people I wouldn't piss on if they were on fire.