1 In terms of Figure 6.4, what are Uber’s value creation, value configuration and value capture components? With an estimated market value of between $60 and100bn Uber has been predicted to become the world’s dominant transportation company without owning a single vehicle.

After its start in San Francisco 2009 it has quickly expanded to over 68 countries and 600 cities worldwide. Uber only employs 12,000, but has over 6 million drivers and 50 million users and generates over 4 billion rides a year. The company is growing at exponential rates and has received over $22bn of equity funding so far.

Uber’s smartphone app is at the centre of their business model. Customers download the app, create an account and put in their credit card information. By tapping the app they request a car and a notification is sent to the nearest driver who can accept or reject the ride and if rejected it is sent to another driver in the area. Customers can track the estimated time of arrival and the meter via the app. Payment is made to Uber via the app with a later payment to the driver.

The customer gets an option to rate the driver and the driver also has the option to rate the customer.

Through the Uber app customers can search, book, pay and rate the taxi service. They are offered a convenient, reliable and fast taxi service either through luxury rides, priced less than conventional limousine services (Uber Black), or through regular rides priced less than normal taxi fares

(Uber Pop or UberX). The value for drivers is an extra source of income and flexible working hours. The review and rating system is a key difference compared to regular taxis. Customers can avoid drivers’ with low ratings and drivers can avoid passengers with low ratings.

The basic resources of Uber include their technological platform and app, but they do not own any cars or employ any drivers. Drivers own the cars and are self-employed and apply to Uber to become a driver. Uber’s activities are configured to match customers with a nearby driver and car. In addition to match making, the platform and app includes pricing and payment, car tracking and review systems. Uber thus structures the value for both customers and drivers through the development of sophisticated software and algorithms that optimise matchmaking, pricing and reviews for different cities and local markets.