When it comes to internetworked change, Uber Eats is a key entity. Whether it’s by taking power economically in the hospitality industry, influencing political labour laws, or manipulating the cultural workings of ordering food and food consumption, Uber Eats represents an innovative internet ecosystem that has had transformative effects.
Uber Eats has emerged as an innovative market leader by harnessing its ecosystem of partner business and delivery drivers via the internet to facilitate its food-delivery services worldwide. With a focus on the role of web technologies, a critical analysis will be undertaken on Uber Eats and its transformative effects on the food and hospitality industry and the way individuals interact within it.
This essay will begin by situating Uber Eats historically and as a business model. This will be followed by a discussion of how Uber Eats’ app design, products, services and strategic contracts have been used in transformative ways – economically, politically and culturally.
The internet ecosystem of Uber Eats – Full critical analysis of its transformative impacts
WHAT IS UBER EATS?
Uber Eats is an online, app-based food-delivery service. Based in San Francisco, California, and the sub-branch of global ride-sharing enterprise Uber, Uber Eats is the intermediary app between restaurants and hungry but busy customers. The app connects users with a range of nearby restaurants and provides users with the ability to order from the full menus of those restaurants are any time.
Uber Eats exemplifies how “questions of location and location awareness are increasingly central to our contemporary engagements with the Internet and mobile media” (Wilken & Goggin, 2015, p.5), because the introduction of Uber Eats and its location-based services galvanises users to articulate their consumption desires from any location.
Watch this great introductory YouTube video below created by Uber Eats that covers the basics of how Uber Eats works.
HISTORY OF UBER EATS
The introduction of Uber Eats is exemplary of the rise of internet-based locative media in mobile phones due to wireless internet and networked technologies (Wilken & Goggin, 2015). In 2014, Uber Eats was one of several experimental services trialled by then-CEO of Uber, Travis Kalanick, to utilise the parent-company’s user database to ultimately broaden its services.
Uber Eats was then officially launched in 2015 in Los Angeles, Chicago and New York, in which local restaurants were invited to join as partnering businesses. Unlike its main competitor, Deliveroo, which had launched in the UK in 2013 and progressively built a network of delivery riders over the following years, Uber Eats was influential in its field because it utilised its extensive network of Uber ride-share drivers to rapidly and successfully expand into countries around the world.
In February 2020, Uber CEO Dara Khosrowshahi said Uber Eats was shifting towards “its next phase of more profitable growth” (as cited by Abril, 2020), and this timing aligned with Pierre-Dimitri Gore-Coty replacing Jason Droege as the head of Uber Eats.
In July 2020, the parent-company of Uber Eats – Uber – bought out food-delivery competitor, Postmates, in an effort to extend its control over the app-based food-delivery sector and its users, and therefore increase revenue streams.
UBER EATS AS A BUSINESS MODEL
Uber Eats’ disruptive business model is what scholars note as a ‘triadic business model’, which creates value by using a platform to facilitate interactions and transactions among buyers and suppliers of a product or service. Using the Uber Eats app as the platform through which to conduct business, Uber Eats has a clear and definite profit model (Tao et al, 2019), because partnering delivery drivers act as micro-entrepreneurs by being responsible for delivering the value proposition – food – to the platform’s customers (Ritter & Schanz, 2019).
In this manner, Uber Eats exemplifies an internetworked phenomenon that scholars define as the “digitally enabled ‘gig economy’ or ‘platform economy’” (Veen, Barratt & Goods, 2020, p.389), made possible by advances in information communication technologies online. As John (2019) notes, technology is the enabler of the gig economy, and thus the Uber Eats app is the basis of the company’s entire business model.
With more than 400,000 partner restaurants across 45 countries, 80,000 delivery partners, and 21 million monthly active users, the Uber Eats platform is what Forsyth (2020) simply describes as “a technological intermediary” (p.288) – connecting the restaurant with the consumer via deliverers.
THE INTERNET ECOSYSTEM OF UBER EATS
See below for a diagram of Uber Eats’ internet ecosystem, to convey how Uber Eats is interdependent with other competitors, suppliers, users, and most importantly, restaurant and delivery partners.
Having doubled its revenue in the three years from 2017 to 2020, Uber Eats is the leading provider of Ready To Eat (RTE) services in Australia, and therefore represents a transformative entity in the food-delivery segment of the Australian online platform-economy. While other leading food delivery services such as Deliveroo and Menulog have noted significant usage increases in their services since mid-2018, Uber Eats still reportedly controls 29% of the global food delivery market.
The economic prowess of Uber Eats has even seen the business surpass Uber Rides in the second quarter of 2020 to become Uber’s main source of income. As such, Uber Eats is dominating the economic landscape and represents how important app-based internet services are in the lives of everyday busy people.
However, this economic supremacy over the food delivery market comes at the expense of individual restaurants. According to the Restaurant & Catering Industry Association and ATO figures, average profit margins at Australian restaurants have decreased from 10% to between 2 and 4% since the arrival of home delivery apps such as Uber Eats. This is because Uber Eats is charging between 30 and 35% of commissions. Concurrently, though, 30% of businesses actually rely upon the delivery platform. Consequently, an entire industry is being destroyed by, but simultaneously relies upon, Uber Eats as a networked entity.
REGULATORY DEBATES AND POLITICAL TRANSFORMATION
However, Uber Eats is not just a neutral, passive technology. John (2019) notes that companies like Uber Eats instead act as “an unregulated and exploitative system whereby people work without the faintest hint of employee protection or social rights” (p.58). this exploitation can be seen in the way Uber Eats’ affordances encode specific rationales relating to profit, and therefore it is constantly shifting and changing its contracts and methods to react to the market, litigation, and competitors.
Specifically, Uber Eats worker contracts contain few details that declare delivery drivers as employees, and therefore the platform has no legal responsibility to provide minimum wage or other industry-level benefits.
For example, in 2019, Adelaide-based Uber Eats delivery driver, Amita Gupta, was sacked for delivering food 10 minutes late. She’d been delivering food for Uber Eats for nearly 96 hours per week, and would be considered an employee in any other industry. Gupta then lost her attempt to bring an unfair dismissal claim following her suspension and then permanent blocking from the Uber Eats app because the Fair Work Commission stated she was not an actual employee of Uber Eats and therefore was not protected by unfair dismissal laws.
This “new ultra-precarious and commodified digitally enabled form of labour” (Veen, Barratt & Goods, 2020, p.389), that can be seen here with Uber Eats, is what Clayton (2020) describes as a disruptive innovation of the gig economy, and one that the Fair Work Commission has been struggling to contend with. Therefore, the political power and control of Uber Eats over its workers and the political system is representative of its transformative political impact due to the way in which it has affected labour laws through its contractual employment methods.
Despite these issues, Uber Eats is one of the most common digital platforms used for working purposes by Australians, signifying its ultimate value as an internet entity.
The success and reputation of individual restaurants and hospitality businesses – and consequently the chances of customers ordering from that business – depends heavily on the design of the Uber Eats app, including its review system, and synthesis and algorithmic ranking of data. This notion can be explained with Thaler and Sunstein’s (2008) Nudge Theory, which describes the “systematic and evidence-based development and implementation of nudges in creating behaviour change” by suggestions as opposed to more overt methods (as cited by Hansen, 2016).
For example, as shown in the screenshot to the right, the powerful design of the Uber Eats app allows it to include, exclude and rank restaurants according to location, engagement data and review rankings ensures that certain restaurants remain as visible options for customers, gently ‘nudging’ users to choose certain restaurants, while other restaurants remain fleeting or invisible. As such, a family’s dinner of choice could be determined by whether or not a restaurant was suggested via the app’s algorithms.
This phenomenon applies to the delivery drivers too, whereby the consumer-facing ratings system for delivery partners ultimately hands the evaluation of worker performance away from Uber Eats and onto the consumer. Users are prompted to rate delivery partners after every interaction, as can be seen in the screenshot to the left, giving the user the power to determine future working possibilities for those deliverers.
The ability for Uber Eats to directly impact the way users interact with delivery people is further exemplified in the social distancing measures introduced by the app due to the impact of Covid-19. In March 2020, Uber Eats introduced “contactless” delivery, whereby users were now able to request deliveries be left on their doorstep as opposed to handed to them in-person by the delivery person. This was supplemented by in-app messages that detailed basic steps users could take to help prevent the spread of coronavirus. These introductions have since fragmented the previous methods of communication between users and deliverers, preventing in-person interactions, and placing a veil of anonymity over deliverers and users.
Furthermore, the integration of useful web technologies within the Uber Eats app interface, including powerful searching abilities, an inbuilt messaging system, location tracking system, ratings system and payment service, provide users with a simple, quick, and accessible alternative to previous forms of ordering and receiving take-away food. These web-based affordances have eliminated the middle-man, and have replaced those multi-step processes with a seamless, all-in-one experience, which is why Uber Eats was the most downloaded food delivery app worldwide in Q2 2020.
Overall, through a critical analysis of the impacts Uber Eats has had economically, politically and culturally, it is clear that the internet platform is incredibly transformative within its internet ecosystem and beyond. While the platform falls into the oppositional binaries of utopia versus dystopia, due to its reliance on digitally distributed labour (Fish & Srinivasan, 2011), Uber Eats is an agent of internetworked change. The multi-restaurant app-based food-delivery service has used its own networked communities to its advantage, ultimately reorganising traditional structures of the hospitality industry and food consumption globally.
Word Count: 1,866 (10% leeway applied)
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