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posted by cmn32480 on Sunday May 21 2017, @12:07PM   Printer-friendly
from the I-am-willing-to-pay-$0 dept.

Uber drivers have been complaining that the gap between the fare a rider pays and what the driver receives is getting wider. After months of unsatisfying answers, Uber Technologies Inc. is providing an explanation: It's charging some passengers more because it needs the extra cash.

The company detailed for the first time in an interview with Bloomberg a new pricing system that's been in testing for months in certain cities. On Friday, Uber acknowledged to drivers the discrepancy between their compensation and what riders pay. The new fare system is called "route-based pricing," and it charges customers based on what it predicts they're willing to pay. It's a break from the past, when Uber calculated fares using a combination of mileage, time and multipliers based on geographic demand.

Daniel Graf, Uber's head of product, said the company applies machine-learning techniques to estimate how much groups of customers are willing to shell out for a ride. Uber calculates riders' propensity for paying a higher price for a particular route at a certain time of day. For instance, someone traveling from a wealthy neighborhood to another tony spot might be asked to pay more than another person heading to a poorer part of town, even if demand, traffic and distance are the same.

Source: Bloomberg


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  • (Score: 3, Informative) by turgid on Sunday May 21 2017, @02:24PM (1 child)

    by turgid (4318) Subscriber Badge on Sunday May 21 2017, @02:24PM (#513022) Journal

    When I go shopping, with a list, I know how much money I have available (my budget) and approximately how much things cost. When I go to pay, I know I've got enough money.

    If they start varying the prices dynamically, when I get to the checkout, you can be sure I'll not be buying several items. That will cause inconvenience for the cashier, the other people in the queue and the shop floor staff. It will be very wasteful when applied to chilled and frozen food.

    When I was a teenager, I worked in a supermarket. It was bad enough then, I can't imagine how bad things like this would make it.

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  • (Score: 2) by kaszz on Sunday May 21 2017, @07:03PM

    by kaszz (4211) on Sunday May 21 2017, @07:03PM (#513109) Journal

    Haggle until the food becomes bad and then quit. Then repeat. Eventually they learn by negative economic feedback. Or that people just go shopping online.

    Another example is when big markets under staff checkouts so that queues grow long. The counter move is just to drop the gods somewhere and leave the shop. Which will cost the shop work hours and lost sales.