The problem is with the information inbalance. Before, a salesman, for example would look at what kind of clothing you were wearing and what segment items you're looking for.
Now let's do a little thought-experiment with the Uber ride and look at the information you and Uber have to make your price and choice on:
For Uber:
- What time is it? +
- Are you far away from home? +
- Have you been here before? -
- What have you paid before? +
- Where do you shop usually? +
- Are you rich? ++
- Are you ill? +
- Are you pregnant? +
- Are you drunk? ++
- Are you very drunk? +++ (bonus!)
- Are you sad? +
- Did you just break up? ++
- Do you have any friends? +/-
- Do you have any friends with cars? -
- Are you alone? +
- Are you going home? +
- Are you already home? -
- probably a lot more...
For you:
- Price?
- How screwed am I if I don't take the ride?
There are not many other options. Maybe a taxi's while they last and Lyft probably has the same algorithm.