Oracle’s Larry Ellison Calls Uber and WeWork ‘Almost Worthless’

https://www.barrons.com/articles/oracles-larry-ellison-calls-uber-and-wework-almost-worthless-51568924122

by ycombonator • 7 years ago

59 92 7 years ago

trey-jones• 7 years ago

He isn't the only ones to make that assessment either. I think you will find this to be a common opinion among people who are paying attention.

jgwil2• 7 years ago

Neither of these companies is actually adding any value at all as far as I can tell. Uber is undercutting taxis/transit with investor-subsidized rides and still has no idea how it's going to turn a profit unless it becomes the only ride in town. WeWork is pure middleman with some good branding. It amazes me that people believe these valuations. However, I can't agree with the cat comment; I'm sure Uber engineering are tackling tough technical problems.

conanbatt4• 7 years ago

Dude..Uber changed the world.

weare1382• 7 years ago

It's an unlicensed taxi. The only thing Uber has done is somehow make taxi's worse.

ellyagg3• 7 years ago

On a personal note, I hope you're wrong, because Uber has added a ton of value to my life.

trillic• 7 years ago

Yes it has, mine too, I love cheap, easy rides. What makes that possible though is because Uber is essentially selling $1 bills for 75 cents. Uber at the prices it currently charges in most markets is not sustainable.

sokoloff2• 7 years ago

I think Uber (and Lyft) are absolutely adding value. I now regularly take ride shares when I would previously have driven or extremely reluctantly taken cabs. I also talk to my rideshare drivers and the platforms provide some much needed cashflow (and perhaps day-filling) for people who seem genuinely happy to avail themselves of the income opportunity provided.

I see no reason to think that those two companies couldn't be quite profitable in their core businesses in their established cities. (I think they already are.)

That said, their valuations in the market are comically/insanely/unjustifiably high, but that's quite different from saying they "add no value".

WhompingWindows3• 7 years ago

They may add value vs taxis, but would Uber or Lyft add value vs any other startup taxi service?

Expanding further, How about a taxi-app you and I could sit down and hack out? How much value-add is there in an Uber or Lyft vs what we could do?

im_cynical• 7 years ago

I heard some economist call Uber "the greatest transfer of wealth in a very long time". What Uber is doing is taking investors money and subsidizing your Uber ride to a restaurant.

They are providing value and I'm a casual user myself. However the consumer price right now is arguably unsustainable against the stated quote above. To survive both of them are going to have to raise prices

praptak• 7 years ago

They do add some value. They don't add any value above a taxi company/cooperative with a decent app.

stedaniels2• 7 years ago

Neither Uber nor Lyft are really ridesharing. They are ride hailing apps. Unless you are sharing with other passengers? I didn't realise they offered this?

otakucode2• 7 years ago

The problem I see with Uber is that, at the end of things, all they provide is some software running on some servers. While not an easy weekend project, it would not be impossible for a distributed system to replace it, making whatever life they have almost certainly temporary. Every action they take to extract more profit will only increase the pressure toward development and move towards a distributed system. As long as it can present an app to a customer that can hook them up with a driver without being obtrusive, it seems like a service destined to become a commodity and certainly not something likely to be a cash cow for long.

perseusprime11• 7 years ago

Ellison's cat seems straight out of a Murakami novel.

JamilD• 7 years ago

I'm sure Uber engineering are tackling tough technical problems

They definitely are, but I think the point is that those technical problems aren’t core to the service. The value that Uber provides to you is a platform for independent, cheaper taxis – the routing algorithms and ML add to that, but the technology isn’t core to the product or the value of it.

overcast• 7 years ago

It's always been my personal opinion that they should sell their software as as service to taxi companies through integration agreements. Besides the nicely subsidized prices, the act of easily being able to hail a ride is a game changer.I really don't give a shit what car I'm getting into, as long as I'm not calling some sketchy number, talking to someone I can't understand, and having it actually show up.

opportune2• 7 years ago

In some markets it is absolutely possible to summon a regular taxi via uber

nugget• 7 years ago

Uber is the reason I no longer need to take out local currency when I am traveling in Europe. I'd happily pay a 50% or greater premium to avoid the hassle of dealing with local taxi companies.

spelunker• 7 years ago

Do you remember what getting a taxi was like before Uber/Lyft? Uber is a cash burning machine for the investor, but it's definitely adding value as a customer.

jmpman• 7 years ago

I’ve been using Uber for years. From my perspective, the experience hasn’t changed dramatically. I request a ride, a ride shows up, when I get to my destination, I’m billed. I’ve wondered why ride hailing companies haven’t dramatically slashed their engineering teams if the engineers aren’t able to map their efforts directly back to lowering ride costs. For some reason, >100% the cost of an Uber isn’t being passed on to the drivers and yet the company remain unprofitable. Where are the costs besides engineering and drivers?

crispyambulance• 7 years ago

Uber got to where it is today because Taxi companies weren't able to adapt and ignored the threat until it was too late.

Really, all people want from a Taxi is an easy, reliable way to summon transport and take you to wherever. Everyone hates calling a taxi company on the phone, speaking to a surly dispatcher, giving an address verbally and then waiting for an indeterminate amount of time for the taxi to show up-- and then you had to have cash to pay.

By the time the Taxi companies figured that out, they were already gutted and in a downward spiral because of Uber's brutal, calculated competitive practices.

billhathaway• 7 years ago

Taxis in Las Vegas were adding a $3 fee for paying with credit card. That was so frustrating.

WaylonKenning• 7 years ago

And unlike the network effect where winner takes all, I doubt we'll all forget about taxis, and think, man, if only there was this yellow car I could stick my hand out to, and they'd give me a ride for cash.

There's always the thread of competition for Uber. Ironically, the thread from the very market they disrupted! I'm guessing Taxis 2.0 won't have medallions to worry about anymore, just the same regulations as any other ride sharing firm, with only one car.

But hey, I'll take subsidised rides from Uber for as long as they're offering them!

opportune2• 7 years ago

Uber is absolutely adding value, in my opinion. Disclaimer: I’ve invested a paltry amount in them

Uber is a taxi dispatcher and provides a rating system that provides a vastly improved product to the end user. Seriously Uber is so much better than taxis. You can hail it from your phone, track its arrival in real time, know the fare before you book it. It arrives in 10-20% of the time of a dispatched taxi, costs less, and has much better drivers on average both in terms of skill/not being aggressive, not being assholes, English, and cleanliness.

Uber freight is frankly just a good idea. They already have a huge fleet of drivers and a lot of the tech backend in place to start doing last mile delivery. Lots of value add in that, and in combining last mile delivery with concurrent user transportation.

Uber also has a lot more international exposure than Lyft.

The only issue I have with them as an investor is in Uber eats. It’s costing too much money to subsidize, has too much competition, and food delivery just isn’t something I think can work in the US.

But regardless, when you look at Uber’s core product, I think you would have to have either forgotten about taxis or never have taken Ubers/taxis to begin with to think it’s not a vastly better product.

jfengel• 7 years ago

The biggest thing that Uber added was the ride-summoning app. I gather that these are beginning to come into existence for taxi companies, but especially at the time, it was a huge boon to download one app and be able to summon a ride wherever you went.

Instead, you often had to place an actual voice phone call -- or multiple calls, since different companies had different dispatchers. You would get no feedback on when your taxi might arrive -- or even if it was. I've answered plenty of panicked phone calls from friends whose prearranged taxis didn't arrive and were desperate to get to an airport before their flight.

If the taxi companies had acted professionally about it, Uber might not have been able to take off. As it was, using Uber was simply a better experience than taking a taxi -- except perhaps right in the middle of the most taxi-heavy cities, where you could stick out an arm. It wasn't so much about price as about just knowing that the ride was coming, and not really caring who precisely provided it. The taxi companies were not competing on anything I cared about.

The actual car-sharing aspect of their service is of dubious merit, and I prefer Lyft to Uber anywhere I can. But I'll take either to having to actually phone a dispatcher, or having to download Waave in New York and myTaxi in London and god only knows what in Cinncinnati.

ErnestedCode• 7 years ago

I gather that these are beginning to come into existence for taxi companies

There is a lot of value in having only one or two major players in this space. I often travel and use Lyft or Uber to get around. If you have to Google 3 companies every time your plane lands in a new city and create a new account and add your credit card, that is a tremendous hassle.

jdoliner2• 7 years ago

Have you ever used Uber? Did you ever use Taxis back when they existed? It's astonishing to me how much better Uber is than Taxis, there's no question that they're adding a ton of value compared to what they're replace, at least for me as a consumer. But I hardly think I'm alone in this. On the other-hand will they be able to profit from this value? That's at best tbd, and likely already a conclusive no, they've built a valuable commodity, that people aren't even used to paying commodity prices for because it's been VC subsidized for so long. So I can't agree with the adding no value comment, but I don't think the valuation is correct.

JohnFen4• 7 years ago

Have you ever used Uber? Did you ever use Taxis back when they existed?

Yes, and yes, but (at least where I live), the Uber/Lyft "experience" is not superior to the taxis at all.

xxs• 7 years ago

I guess it depends where you live.

I used (15y+ ago) to go to work and back by taxi every day for years. Recently (last 2-3y) I got taxi on occasionally; also living in a different area. No real difference with app based ones except for the payment methods. That's it, no need to pay anything for app-based ones (not uber) in the taxi, immediately. That makes the ride shorter and I don't need to care if the taxi will be equipped with a POS terminal as I seldom carry cash.

optimuspaul• 7 years ago

I work in WeWork (not for them, my company uses them) and I think that they provide tremendous value. I don't see how they are middleman at all. Having worked at many startups and small companies over the years I know that finding a good space to work is difficult. WeWork is making it very easy and provide a lot of services on top of that which make it worthwhile. Are they unique? No, but that doesn't mean they don't provide value.

tinktank• 7 years ago

You obviously don't know Ellison's cat...

fabiofzero• 7 years ago

I hate to agree with this asshat, but he's right.

sam_lowry_• 7 years ago

Oracle Linux, its flagship database and many of their products are utterly worseless.

hugofirth• 7 years ago

I don't like Oracle any more than the next person, but this just isn't true at all. Oracle is a robust product which fills an important part of any technical stack. Building and supporting databases is hard.

paggle• 7 years ago

Both of these companies provide a valuable service, and in Uber’s case a massively world changing one. Even if these companies only end up being worth single digit billions, they are still great companies independent of Saudi money pumping valuations into the absurd.

rb808• 7 years ago

Now that we've nearly migrated everything off Sparc & Oracle DB I'm ready to declare Oracle almost worthless too. At last.

imglorp• 7 years ago

Considering how often they sue their customers, increase prices after lockin is established, triple their support fees, etc etc. one might consider Oracle less than worthless. Sometimes it's a liability.

CaptainZapp• 7 years ago

Shortet some stock Larry, didn't we?

rossdavidh• 7 years ago

Well I've been pretty negative about Uber and WeWork up to now, but if Larry Ellison is against them, maybe it's time to reconsider.

Kidding, I'm kidding. Sort of.

jayess• 7 years ago

I feel like many people don't remember a few short years ago when your options after a night of drinking were to call a friend, wait an hour for a taxi that might arrive and definitely doesn't take credit cards, or drive home drunk.

Udik• 7 years ago

[Uber has] an app my cat could have written

The other day on HN's frontpage was an article ("Software architecture is overrated") in which the author mentioned something that made me shudder:

"Rewriting the Uber app was a project that a few hundred engineers worked simultaneously on, porting existing functionality to a new architecture."

I keep not understanding how it is possible that companies whose core business is very far from IT (e.g. taxi and ride sharing for Uber, or television for Netflix) can be considered high-tech companies and take pride in investing inordinate amounts of money on engineering. What is the point? What is Netflix doing in the company of Facebook, Apple, Amazon and Google?

paulsutter• 7 years ago

At first I thought Uber will be a great business charging 20% of rides if they can ramp up to many millions of riders.

Now they squeeze drivers harder and harder for bigger and bigger percentages. Yet they are losing money faster and faster.

The problem is they’ve hired armies of very talented people, each one-upping the next on initiatives to screw drivers a little worse, or create some lame promotion, and pretty soon you have a ruthless company that is also drowning in expenses and headcount.

nunchuckninja• 7 years ago

Isn't he a director of former?

dshuang• 7 years ago

outline https://outline.com/TfLjdh

rdlecler12• 7 years ago

Last time I used Uber? this week. Last time I used coworking space? This week. Last time I used Oracle? ...

sdinsn• 7 years ago

And since Uber and WeWork are losing money for every ride and tenant, you are contributing to their downfall.

Meanwhile, Oracle made $3.8 billion of net income in 2018.

cjarrett2• 7 years ago

Last time you used a service backed by a service run likely by oracle? Multitudes of times this week.

rdlecler12• 7 years ago

And most of those are legacy companies that are in their sunset.

mrweasel• 7 years ago

The is a valid point to Ellison comment regarding loyalty. If you don’t care about profit, like Uber, then you can undercut your competitors. Neither drivers nor customers would care if Uber suffers, if they can get a better deal else where.

The technology also isn’t special enough that it alone can support the massive value of Ubers stock.

sonr• 7 years ago

Uber provides great value to people like me who can't afford the burden of having a car and driving and only need a car maybe 20% of the time for various occasions. However, if Uber had to charge rates that would make them a real profit, people like me will simply no longer be able to afford it. We would go back to walking, biking, or taking the bus.

Just my 2 cents here.

simonblack• 7 years ago

Uber is good only for Uber itself and (temporarily till the collapse) the customers. It is a SCAM for drivers and investors.

caveat emptor.

Oracle’s Larry Ellison Calls Uber and WeWork ‘Almost Worthless’

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