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22
FORTUNE.COM // SEPTEMBER 2019
MOBILITY
Uber Wants Your
Loyalty—and Cash
The on-demand transportation company
looks to the Amazon Prime model to stabilize
revenues. By Danielle Abril
UBER’S PATH to profitability
remains murky after it recently
posted an eye-watering $5.2 billion quarterly loss.
But it’s hoping its new $24.99-per-month subscrip-
tion service will win over skeptical investors. The
subscription offers free food delivery, unlimited
electric bike and scooter rentals, and discounted
car rides—and provides a more stable source of
revenue for the company.
“It’s a smart experiment,” says Mark Mahaney,
analyst at RBC Capital Markets.
If it works, Uber could better cross-market
its services to customers who may otherwise be
exposed to only one—something that CEO Dara
Khosrowshahi continues to emphasize. The sub-
scription also increases the opportunity to create
brand loyalty, which thus far doesn’t seem to exist
within the ride-hailing industry, says Tom White,
analyst with D.A. Davidson. Uber is currently test-
ing the model in Chicago and San Francisco, with
the possibility of rolling out elsewhere.
Some Uber competitors are exploring the idea
as well. Lyft has a
$14.99 monthly op-
tion that gives riders
10% off all trips. It
also has a plan that
offers riders fixed
prices if they pay
upfront. Though it
has yet to roll out a
package that would
bundle electric bikes
and scooters, it’s
fair to assume that’s
something the com-
pany is considering.
Uber’s idea could
serve as a Band-Aid
to help stop its mas-
sive quarterly bleed-
ing. But if the offer
isn’t strong enough,
there’s the risk that
another subscrip-
tion in the mix could
fatigue customers
already shelling out
for cable, Amazon
Prime, Net flix, Hulu,
Spotify, gym mem-
berships, and public
transit cards.
E-SPORTS TEEN
WINS GR AND
SL AM PAYCHECK
E-SPORTS
THE ARTHUR ASHE sta-
dium has been home
to some legendary
contests: Sampras
vs. Agassi, McEnroe
vs. Borg, Graf vs.
Seles. But in July the
New York tennis ven-
ue saw a new breed
of competitor raise a
trophy on its famous
blue court—a Fort-
nite champion. Kyle
“Bugha” Giersdorf,
16, of Pennsylvania,
earned $3 million for
winning the inaugural
Fortnite World Cup.
That’s as much prize
money as the U.S.
Open winner took
home in 2014.
FORTNITE WINNER
K YLE “BUGHA” GIERSDORF
$3,000,000
U.S.OPEN WINNER, 2018
NAOMI OSAK A
$3,800,000
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