Uber launches courier service UberRUSH. Can it avoid the early headaches of its car service?
Uber is often included in the so-called sharing economy. Sure, its app allows consumers to summon independent drivers with their own vehicles to make a quick buck, but that's not the company's focus. Instead, its emphasis is on the black car and taxi services staffed by professional drivers. Uber isn't a member of the sharing economy so much as it's a next generation livery service.
That distinction continues with the UberRUSH delivery service that began its pilot program yesterday. The service allows anyone to summon couriers to make deliveries anywhere in Manhattan with a $15 starting rate that increases by $5 for every "zone" crossed during delivery. (No surge pricing, at least not yet.) Now that it's part of the "on-demand delivery" space, Uber's competitors will include not just Lyft and Sidecar but Postmates and eBAY Now, though at this point UberRUSH is limited to sending and receiving items, not ordering from merchants. VentureBeat broke news of the service after spotting a related job listing on Craigslist offering an iPhone 4S to anyone with a way to get around Manhattan and a desire to make deliveries.
It's strange that Uber is turning to independent workers for the first serious expansion of its service that doesn't involve a steering wheel. The company's previous attempts to quickly add non-professionals to its service haven't worked out so well: the subpar training offered to drivers before SXSW 2013 resulted in a takedown of its service at the New Yorker, and its background checks have repeatedly missed problematic drivers with existing felony records.
Working with professionals would allow the company to avoid some of those mistakes. It would also allow Uber to introduce services more convenient than their predecessors but less hit-or-miss than competitors that also rely on independent workers. Making deliveries might not seem that difficult, but as Fast Company's Sarah Kessler detailed in a story about working in the so-called gig economy, it can be harder than most people would expect. Professionals understand that -- people responding to a Craigslist ad might not.
There are some drivers making a living off Uber's personal service. There will probably be a few independent couriers relying exclusively on UberRUSH, assuming the service survives. But that isn't Uber's focus. Instead, it works to introduce new tools that connect consumers with existing services while making communication, payment, and tracking easier than before. It's a glorified queuing and point-of-sale system, not an agent for the sharing or gig economies.
Uber is at its best when it understands that and partners with existing car companies to get their drivers onto its system. It's too early to tell if the same will hold true for UberRUSH, but it's odd to see Uber make such a big announcement on the backs of amateurs.
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Vox.com looks beyond UberRUSH to see the company's future:
Messenger services just in part of Manhattan is clearly a pretty small line of business. But it's an important sign about where the company is heading. They are known to the world as a car dispatch service, but they like to describe themselves as specializing in "urban logistics." Last December they staged this Christmas tree delivery marketing stunt, that I said was likely a precursor to a broader move into delivery. And now you're seeing a version of that come to fruition with Uber Rush.
The ability to dispatch vehicles to arbitrary locations and efficiently route them through a city has a lot of potential applications beyond just taxis. Ultimately the company would like to make a much bigger push into the broader world of delivery and logistics, and this is the toe in those waters. Bloomberg Businessweek reports on UberRUSH's status in Manhattan's delivery market:
Uber wouldn’t specify how many messengers it has on board, saying only that the delivery force is 'enough to make it reliable.' The company sees courier industry services much the way it saw the pre-smartphone black car sector: behind the times on reliability and customer service. 'No one was getting it quite right on the messenger service piece, and we were seeing people use Uber cars to move things,' says Josh Mohrer, Uber’s general manager in New York.
I sent a book, a granola bar, and a dollar bill from the Bloomberg office at East 59th Street and Lexington Avenue to a friend who works near Battery Park City at Manhattan’s southernmost extremity. Uber quoted me $25—slightly higher than standard courier rates but lower than rush rates, and the delivery estimate seemed comparable to a rush job. After sending my care package, I got quotes of $20 from RDS Delivery Service and $23.20 from Breakaway Courier for the same delivery; buying rush status would have raised the price to $30 and $46.10, respectively, and each company said rushed packages would take about 90 minutes. Quartz explains why Uber isn't a member of the sharing economy:
Uber isn’t peer-to-peer: It is about connecting customers with established businesses, through a marketplace which is eager to avoid any liability for the transactions it clears. And that’s an area where self-regulation doesn’t have a very rosy history—it helped bring you the Libor price fixing scandal and the US housing bubble.