Uber, Lyft
Uber and Lyft are roughly in the same business and aiming to reinvent transportation, but their technology approaches have more differences than similarities. Sure the technology strategies rhyme in places, but Uber’s approach is broader as it eyes multiple businesses.
When comparing the regulatory filings of Uber and Lyft some technology differences become clear. First, Uber sees itself as building a marketplace and technology platform that can extend into multiple areas (Uber Eats and Uber Freight for instance) while Lyft sees itself as primarily in transportation as a service provider.
Uber, which is kicking off its initial public offering priced at $45 a share, also touts that it has “a team of more than 3,000 highly skilled engineers and computer scientists whose expertise spans a broad range of technical areas” and an automated infrastructure. Uber has 22,263 global employees. Lyft said 36 percent of its 4,791 employees work in its product management, engineering and design organizations.
Meanwhile, Uber reported 2018 net income of $987 million on revenue of $11.27 billion. Lyft reported a 2018 net loss of $911.3 million on revenue of $2.16 billion.
Here’s a look at the approaches on key technologies by Uber and Lyft.
Cloud
Uber appears to have a classic hybrid cloud approach. Uber has co-located facilities and multiple cloud vendors. Uber said:
We have developed our infrastructure to be highly automated, enabling us to improve our platform and add new features with rapid velocity. We built our platform to handle spikes in usage, such as those we experience during holidays. We currently use multiple third-party cloud computing services and have co-located data centers located in the United States and abroad. These partnerships allow us to quickly and efficiently scale up our services to meet spikes in usage without upfront infrastructure costs, allowing us to maintain our focus on building great products.
Uber also said that it has commitments for network and cloud services as well as background checks with varying expiration terms through 2020. Uber’s filing also includes order forms for upgrading access to Google Maps APIs.
Lyft has bet on Amazon Web Services for its architecture and has agreed to spend at least $300 million between January 2019 and December 2021. Lyft said the AWS partnership allows it to be more resilient to surges, but said if it fails to hit its minimum purchase requirement with AWS it may be required to pay the difference.
“We pay AWS monthly, and we may pay more than the minimum purchase commitment to AWS based on usage,” said Lyft. AWS may only terminate its Lyft agreement for convenience after March 31, 2022 with advance notice.
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Marketplace technology
Uber has built its own proprietary marketing, routing and payment technologies. The bridge between Uber’s various ventures is its marketplace technologies. Uber said:
Our marketplace technologies comprise the real-time algorithmic decision engine that matches supply and demand for our Personal Mobility, Uber Eats, and Uber Freight offerings.
The marketplace tools include:
A demand prediction engine to predict volume, supply and demand and location dynamics with current and historical trends. Data visualizations are available for zones with unique pricing characteristics. Matching and dispatching algorithms that review and consider variables such as distance, time, traffic, weather and even meal preparation times for Uber Eats. Pricing tools that set real time prices at the local level based on demand.
Lyft said that its platform leverages historical data, supply and demand as well as driver availability. “Utilizing machine learning capabilities to predict future behavior based on many years of historical data and use cases, we employ various levers to balance supply and demand in the marketplace, creating increased driver earnings while maintaining strong service levels for riders. We also leverage our data science and algorithms to inform our product development, such as the introduction of our current subscription product,” the company said.
Marketplace efficiency is powered by Lyft’s dispatch platform and data such as distance, route, traffic and travel. Lyft prods drivers to go in areas based on sustainable prices so they can increase earnings.
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