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This Week in Uber News: Google to Compete?

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Ride-sharing company Uber has been grabbing headlines all year. Going in to 2016, many expect that it could be primed for a massive IPO. This week has seen a couple key pieces of news surrounding Uber, including a new competitor entering the fray.

Also read:Will Uber Be The Hottest IPO of 2016?

Google GOOGL announced that it plans to make its self-driving cars unit a stand-alone business under the Alphabet Inc. umbrella. The move will happen next year and will help Google's car unit work towards several new initiatives.

One such initiative could put Google in direct competition with Uber. Google plans to launch a rides-for-hire service using its autonomous vehicles. Google's cars have racked up more than 1 million miles on public roads around San Francisco and Austin, Texas, and now they look primed to start bringing in money.

Under the ride-for-hire program, both large and small cars would be available. Just like Uber, these cars would be deployed to pick up passengers, but in this case no driver would be needed. It is unclear as of now whether this would be done in a new application like Uber.

Bloomberg reported that a person at Google with knowledge of the company's strategy said that the fleets could be deployed first around confined areas like college campuses and military bases.

Moving the self-driving car unit to its own company is exactly the type of tactic investors expected when Google first announced the Alphabet Inc. idea. Challenging the likes of Uber and Lyft is the most obvious indication thus far about how Google finally plans to monetize what has been a lengthy and costly research project.

This is obviously a bit of a red flag for Uber. While Google will be hit with a big up-front price tag as it builds and deploys these cars, the lack of a driver could keep costs down in the long-term. If that means that Google can offer lower prices to customers, Uber might struggle to compete. Of course, as the technology for self-driving cars becomes more commercially available, one would expect that Uber will develop a strategy to stay on the cutting edge.

Also in Uber news this week is a new partnership with Facebook FB . Facebook Messenger users can now request Ubers within the Messenger application. Uber is even dishing out a $20 Uber credit for anyone who uses the Messenger Transportation feature.

This is really a big move for Facebook as it looks to monetize its Messenger application, although Facebook and Uber did not comment on a possible revenue share with the feature. "We're just getting people used to the idea that you can message more than just people on Messenger," said Seth Rosenberg, Facebook product manager.

Integration with other businesses is something that we should begin seeing more and more of from Uber. Earlier this year, Uber launched a developer's platform and offered $5 per new user to entice businesses to embed Uber ride requests into their own apps.

Uber will also begin to use Messenger as a test case for real-time customer service. "We will start testing live support through Messenger to find out if this is the best way to start using real-time support through this," Uber's head of API and strategic partnerships Rahul Bijor said.

Currently, Uber users must file customer service requests within the Uber app and wait for a response. These responses can take from several hours to several days. Now, we see Uber's first attempt at real-time support, which is something that seems like a great idea within Uber's operational structure.

Check back here for all of the latest news on Uber!

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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