Comment by eridius | Hacker News Reader

Comment by eridius | Hacker News Reader

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This is a time-limited pilot program that also caps the number of scooters. It's far from a market monopoly.

In addition, there's no network effect with scooters. Car sharing has the chicken-and-egg problem where you need enough drivers to meet demand, and you need enough passengers to give drivers a reason to drive for you. But scooters are cheap and easy to dump a whole bunch on a city, so there's no reason why a new company can't move in on an existing scooter market. For the most part the only important pieces are the brand recognition of the company and how easy their app is to use. If Uber is serious about scooters, I fully expect them to just move back in when the pilot program is over and immediately pick up a sizeable chunk of the market.

I disagree. There is a network effect here, people will use the brand that already is installed on their phone PLUS the one that has the most scooters. This is what can occur here.

Using the app already on your phone isn't a network effect. A network effect is when the more users there are, the more valuable the network is to each new user. For ridesharing, the more drivers there are, the more useful the service is to passengers, and the more passengers there are the more attractive the service is to drivers. But for scooters? Whether a given scooter brand is popular or is unknown has no bearing whatsoever on its utility to a new user, all that really matters is whether the scooters are available when and where the user wants them, and whether the app is easy to use.

If someone wanted to sell a new app, they have to get people to recognize their brand and install their app no matter what.

Ride sharing companies then also have to reach a critical mass where drivers and riders can match in a reasonable time. I think overcoming that is the network effect.

"Overcoming entering into a new market" is categorically different from "Overcoming a mandatory 6 month freeze on your ability to compete while your competitor gets first dibs."

There is definitely a density effect with scooters although. And seeing the past behaviors of governments, 'temporary' things often become permanent limits.

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