Reference no: EM133312310

"We are a technology platform that uses a massive network, leading technology, operational excellence and product expertise to power movement from point A to point B. We develop and operate proprietary technology applications supporting a variety of offerings on our platform. We connect consumers ("riders") with independent providers of ride services ("drivers") for ridesharing services, and connect consumers ("eaters") with restaurants ("restaurants") and food delivery service providers ("delivery people") for meal preparation and delivery services... We use this same network, technology, operational excellence and product expertise to connect shippers with carriers in the freight industry. We are also developing technologies that will provide autonomous driving vehicle solutions to consumers, networks of vertical take-off and landing vehicles and new solutions to solve everyday problems. Our technology is available in 69 countries around the world..."

1. Describe the network effects present on Uber's platform for ride-sharing services.

2. Describe one way that Uber's diversification into the freight industry could satisfy the "value test" for corporate strategy.

3. Uber also offered a co-branded credit card with Barclay's that gave its users an extraordinarily high 4% cash back when dining at restaurants. (By comparison, the card only offered 2% back on Uber fares!) Why might this be an attractive opportunity for Uber even if the fees Uber/Barclay collect from transactions and cardholders do not cover the costs of providing the 4% cash back benefit?

4. How would network effects influence a restaurant's decision to join Uber's platform for meal preparation and delivery services?