Contents:

7 min read

    7 min read

    In this round up, senior RSG contributor John Ince covers the quiet ending to Walmart + Uber/Lyft’s relationship, Uber’s flying car, and how ridesharing’s “management by machines” may be the future of work.

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    Walmart’s grocery delivery partnerships with Uber, Lyft fail to take off: [Reuters]

    Sum and Substance: (Reuters) – Walmart Inc’s online grocery delivery partnerships with ride-hailing services Uber and Lyft have ended, according to two sources, a potential setback for the retailer’s ambitions to challenge Amazon.com Inc head-on with speedy delivery of groceries to people’s homes…

    The decision marks an abrupt end to a business relationship that Walmart and Uber announced with much fanfare less than two years ago. At Walmart’s shareholders meeting in June 2016, CEO Doug McMillon touted the company’s investments in technology and spoke about the partnerships in front of a cheering crowd of 14,000 employees.

    Soon after, Uber’s grocery delivery service was launched and expanded to four markets. As recently as March, just before Uber ended the arrangement, Walmart said Uber would be a partner in its plans to deliver groceries to more than 40 percent of the country…

    Last-mile delivery of packages is an intensely competitive business, with companies ranging from Amazon to United Parcel Services Inc, FedEx Corp and the U.S. Postal service, as well as startups like Instacart and Deliv, vying for a share.

    Since the dot-com boom, companies have tried to crack the business model for online grocery delivery. The rush to solve the technological and logistical challenges has gotten even more frenzied since Amazon acquired high-end grocery chain Whole Foods Market Inc for $13.7 billion last year, a deal that has intensified competition in the sector. …

    But startup investors and experts in on-demand delivery say there is a much different set of logistical and economic challenges for moving around cargo than people, requiring a single company to be proficient in two distinct business models…

    My Take:  …and so another dimension of Uber’s ambitious plans to extend its tentacles into all reaches of delivery commerce bites the dust. No surprise here. Remember WebVan – the high profile flameout from the dotcom / bust era?

    Delivery is a tough business. Investors should have known as much. I hope investors are more skeptical the next time Uber tries to sell them the moon – like with flying cars. (See below)

    This is Uber’s vision of the flying car [Recode]

    Sum and Substance: Look up. Your Uber is here. The near future of transportation might be self-driving cars, but Uber is envisioning a future where people are transported by unmanned flying cars.

    During its second-annual flying car summit in Los Angeles, Calif., Uber unveiled its concept for how riders might get around by air. And while Uber has a strong vision for what these vehicles might look like, it has no interest in actually building them itself…

    For those fearing they may be cut in two when approaching the aircraft, have no fear. Uber says the “design is pedestrian friendly, as the propeller blades are as high as possible, leaving ample room for individuals to board and de-plane without having to duck.”…

    My Take:  I’ll give Uber credit – they’ve got moxie. While they recover from the PR fallout of their driverless car technology having struck and killed a pedestrian, they’re full throttle ahead on a technology and mode of transport that is even more hazardous.

    One can certainly see the appeal of flying cars – enabling a select few to vault over cars stuck in traffic below.  Given Silicon Valley’s fascination with the concept of disruption, you can certainly expect Uber to get some mileage out of this, especially from their existing investor group.

    But wait folks, what about the billions you’re losing now with your existing technology?  Why not just show you can make a profit with what you’re doing, rather than dangle visions of futuristic worlds to anybody who will listen?

    How Uber Drivers Feel About Being Managed By Machines [Forbes]

    Sum and Substance:  The last year or so has seen a number of dystopian predictions that robots will disrupt the workplace. While most of these stories have focused on how the machines will take our jobs, it is more likely that they will support humans in the workplace.

    Uber is a prime example of this, with “managers” at the company as likely to be artificial intelligence systems as they are human managers. A study published a few years ago explored the dynamics of this relationship.

    The whole Uber process is largely human-free, with drivers interacting primarily with the automated management system embedded within the mobile app. This automated manager will assign them pickup requests, give them feedback on their performance (both in terms of their workload and passenger satisfaction) and even punish them for not maintaining standards.

    Recent research from Penn State explored conversations between Uber drivers to try and understand how they feel about their AI bosses. A clear distinction emerged from the study.

    While Uber’s AI performs many of the functions of a manager, drivers feel they have little ability to air grievances, pitch new ideas or even influence changes to their work, all of which would be possible with a human manager.  This is compounded by the fact that most decisions made by Uber about their platform focus on the customer rather than the driver…

    The relationship is crucial, as the vast majority of Uber drivers revealed that they joined the platform because of the autonomy it offers. There have been lengthy discussions, many of them in courts around the world, about whether drivers are employees or independent contractors, but with the platform dictating behaviors to a large extent, it takes the independence you would associate with an independent contractor away…

    There is a but, however. People were happy with an AI boss so long as everything was running smoothly. If there were disagreements or things the employees wanted to change, then it resulted in a rapid deterioration in the relationship….

    My Take:  This is the article that I’ve been wanting to write for some time – an examination of management by machine. Neither Uber nor Lyft have a lot of choice in this matter. With over 2 million drivers worldwide, the cost of some kind of more personalized human interaction would be economically prohibitive.

    Yes, they have real human beings in their Greenlight/Hub offices, and you can talk to a real person on their help lines now, but most communication is handled by mass email and text messages. Their machines measure your performance in a few select metrics – acceptance rate, cancellation rate etc.

    The performance appraisal is done by passengers through an automated system. I suppose it works, but something seems strange about it… almost creepy. Your thoughts?

    Related: Your Most Popular Rideshare Questions Answered

    Uber finds that its software was likely responsible for deadly collision: [Fast Company]

    Sum and Substance: As part of its ongoing investigation into the deadly Arizona crash between a self-driving Uber vehicle and a pedestrian, the company has found that though the car’s sensors detected the pedestrian, the car’s software was too slow to react, reports the Information.

    Specifically, the software designed to decide how it should react to objects in its path took too long to decide because it was tuned too far in favor of ignoring objects that could be “false positives.”… It’s important to note that the official NTSB investigation into the deadly collision is ongoing and Uber’s report is only preliminary.

    My Take:  This is a troubling revelation. If Uber is unwilling to set its software to the highest possible settings when testing out driverless cars, why should anybody trust them to do better with flying cars?

    Readers, what do you think of this week’s round up? Would you take an Uber flying taxi?

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    -John @ RSG

    John Ince

    John Ince

    John Ince is a former Fortune reporter and Wall Street banker. He has about 1,000 rides under his belt driving part time for Uber and Lyft.  He’s writing a book about his experiences entitled:  Travels With Vanessa:  A Rideshare Driver Tries To Make Sense of It all - For a sneak peak visit the link above.

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