SoftBank, the Japanese investment company, has put a statement on its investment in Uber.
We are very pleased to have successfully closed the Uber investment and appreciate the support and professionalism of the Board, management team and shareholders who made this transaction possible. Uber has a very bright future under its new leadership. It is now part of a wider SoftBank network ranging from Sprint to WeWork. I look forward to SoftBank helping Uber become an even bigger global success [SoftBank statement]
Yes, Uber is now part of the SoftBank Network. Also in that network is the world’s most valued private technology startup, China-based Didi. It was Didi that gave Uber heat in China, and later on picked up the assets of the U.S. ride-hailing app pioneer. Besides Uber and Didi, SoftBank has Grab in the network through Didi.
Simply, if the industry becomes tougher with margin-depressing regulations, I would expect Uber and Didi to merge. It is going to be a logical thing to do, to avoid value-destroying competition. Why have Didi and Uber waste resources when both are partially controlled by one huge investor?
Lyft, the other U.S. ride-hailing app may be the loser in this game. It has been circled and it has only one market to work on: United States of America. It may not necessarily be all that bad since this business is largely localized. That you have an app does not mean you can be everywhere without dealing with regulators. Contrast that with products from Facebook and Google which are global on launch. For ride-hailing apps, they still need to have booths on ground to operate the businesses. Yet, Lyft’s future is settled: it would not be the category-king but a regional business largely in North America. Over time, it may become increasingly irrelevant at the global level.
In all these redesigns, SoftBank is now the largest ride-hailing business in the world. It is irrelevant that it is not making apps in Japan. Right now, SoftBank is creating the apps that really matter: feeding platforms with dollars to dominate a sector. It has eminently done well and we can now say that it has won this category. Yes, the global ride-hailing app sector belongs to SoftBank----Available to speak in your event, program or company
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