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I think what he's trying to say is that Uber could raise prices "per-trip", split the cost of those trips with 2+ passengers, and actually decrease the cost "per-user" of each trip. If the decrease in price increased demand enough, overall revenue could go up while the consumer feels like they're getting a price decrease (albeit, they now have to share most of their rides, which may feel like a service decrease).

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I get that - I just don't think it'll happen. Instead you'll have 2 people who had a price ceiling of $10 each being transported for $16.

Great for the driver, great for the two passengers, bad for Uber.

On a $10 fare , UBER gets $2(or $4 for 2 trips) , the driver gets $8

For the $16 trip, let's say UBER gives $10 for the driver(instead of ~$8), and takes $6. UBER still comes ahead. And don't forget the huge lockup it gets - which is valuable in and off itself, esp. in the long term as a basis for self driving cars service.

There's of course the issue of decreased traffic for drivers, but there's probably a strategy to make it work.

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