Uber: Disruptive innovation and regulation challenges

Abstract

The first time I've heard about Uber I was in London, during my Internship. I had to reach a place in East London, but I was living in the opposite part of the city. At night time the tube is not working and by bus it would have taken me about 2 hours to reach my destination. So my colleague suggested me to use Uber, I was totally unaware about this app. I downloaded it on my smarthone, I gave my credit card details and in few minutes through the mobile GPS system, I was able to contact the closest available driver to pick me up from my place and to take me to East London, I reached my destination in 20 minutes, the driver came to pick me up in the right location where I was waiting and took me to the desired place. Before getting on the car I was already aware of the amount of time and money that the journey would have costed me and I received a picture of the driver with its rating given by other customers.

This app impressed me for its speedness, reliability, easiness to use and good functioning so I decided to analyze it in deep. I decided to write my dissertation about this incredible innovation that in few years spread all around the major cities in America, Europe and Asia. Its success is mainly due to Internet, IT, GPS system and word of mouth communication; this service, together with other sharing services like Airbnb represents the transfer of power from producers to consumers produced by the digital revolution.

The sharing economy is completely changing the environment we are living in, all the sectors are facing a "movement", barriers to entry have been lowered causing a decrease in the power of incumbent firms. This new way of doing business is just re-using already existing assets like cars in Uber case study, so marginal costs are reduced to zero. I will analyze the functioning of this app, its creation and fundation and later on I will focus my study on the regulatory barriers that Uber had to face worldwide and how it dealt with such issues. At the end I would like the reader to have a better understanding of the power of sharing economy and of new digital services.