Why Uber is joining the race to dominate urban logistics

 


(By Flickr user Jeremy Vandel via a Creative Commons license)

Uber rolled out a new service in Manhattan on Tuesday that foreshadows the five-year-old company's plans to become much more than a platform for e-hailing taxi and town car rides. Now, with UberRUSH, the company is piloting a bike and ped-courier service designed to move stuff, rather than people.

For at least $15 a trip, Uber wants to dispatch couriers to ferry everything from legal papers to fashion pieces around Manhattan below 110th Street (for now).

The new service signals the company's expansion beyond local transportation and into the much larger world of urban logistics. And it's a savvy play for several reasons: The same back-end technology that Uber has built to track drivers and connect them to riders can easily be used to order and follow deliveries. All that changes is the cargo on board and the mode of transportation, a detail around which the company is becoming increasingly agnostic.

These bigger ambitions bolster Uber's claim that it is not, by definition, simply another kind of cab company. Most importantly, though, Uber foresees -- as Amazon and eBay do, too -- that the next growth opportunity in a shifting economy isn't facilitating digital marketplaces: It's moving physical stuff. It's figuring out urban logistics in a world where crowded cities will only become more so, where e-commerce is actually making congestion worse, where the rise of "sharing" has created a need for coordinating the mass joint use of cars, tools, tasks and dinner.

Uber has already been able to tap into changing attitudes among millennials around ownership: Why buy your own car if you can travel everywhere in a town car for less money (or, cheaper yet, ride in a stranger's passenger seat)? Now, however, it's positioning itself not just to leverage the "sharing economy" but to sit at its nexus. You can use UberRUSH, the company suggests on its blog, to deliver your keys to your next houseguest on Airbnb.

Logistics are the logical companion industry to the sharing economy. As the latter grows, so will need for the former. Logistics also represent the unresolved territory of the digital age. The Internet has solved all kinds of other problems: It's enabled us to communicate faster, to pay bills more easily, to shop for products that can't be found in local stores, to open businesses that couldn't cover the rent on a brick-and-mortar storefront. But for all those interactions that take place in the ether, we still need to move stuff in the real world. Your Airbnb keys can't be e-mailed. You can rent a drill bit on SnapGoods, but an online platform can't physically deliver it to you.

This is why Amazon is now toying with drones and predictive shipping. It's why eBay is trying to get in on same-hour delivery. Both companies have long since solved the problem of making just about any product on earth accessible to you and your bank account. The coming race will resolve the issue that arises the moment after you click "buy." Or "rent."

Uber wants to be in that race, too. Disrupting taxis was just the first move, as Kevin Roose wrote in a New York magazine piece last December predicting the company's growth as a logistics behemoth. Now, as Uber expands its services, it's becoming increasingly clear that the company's real competitors were never traditional taxi companies. Its competitors are Internet giants trying to resolve the related problems of the physical world.

Emily Badger is a reporter for Wonkblog covering urban policy. She was previously a staff writer at The Atlantic Cities.
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