Uber takes the flack, gets the law changed, creates the market. Lyft sails in and gets most of the benefits, without those costs.
Uber doesn't have a massive moat. Drivers can have both apps, users can have both apps. You attract drivers by paying them more, you attract riders by charging them less. Uber for now can afford to beat everyone on both those fronts, but eventually they will have to start making a profit. When that happens Lyft is best placed to take advantage.
Uber for now can afford to beat everyone on both those fronts
As someone who drove for both platforms, this is not true. Lyft pays drivers more than Uber in the market I was driving in.
Most drivers would abandon Uber in a heartbeat if Lyft just had more users. The problem was that for every Lyft request that came in, you'd get 10 to 20 Uber requests.
A big reason I switched to Lyft was hearing consistently from drivers that they preferred it. This has the added bonus effect of meaning that wait times for Lyft are way lower than Uber on average IME, since drivers are more likely to pick up a Lyft fare.
Lyft used to be Zimride but Zimride was absolutely nothing like what we call rideshare today. More like a slightly more codified, less sketchy version of CL rideshare.
Fun fact, I was an early and enthusiastic user of Zimride (for making a long distance relationship work between the Bay Area and SoCal). I liked the product and once upon a time drafted an e-mail applying for a position there. I assume I would have been employee like ... 5 or something. Never sent it and it hung out in my Gmail for many years. Decisions, decisions :-)
Uber (Founded March 2009[1]) created ride sharing in SF before Lyft (Founded: June 2012[2]). Uber just started with commercially licensed Black Car drivers and Lyft started with anyone with a car and a drivers license. Then Uber moved down market with UberX and Lyft moved up market with Lux.
I think this is just a matter of semantics. Are you saying we should call a black-car hailing service "ride sharing" simply because you booked it with a smart phone app rather than calling a number? (Remember that Uber didn't even use a novel business relationship; there have long been dispatchers with a single phone number that distribute the rides to multiple independent black car agencies.)
To me, the key change deserving a new term was allowing completely independent, non-professional drivers, and I think Lyft beat Uber to that. (Heck, some purists would say "ride sharing" should be reserved for cases where the driver doesn't make an wages, just reimbursement for costs.)
Uber doesn't have a massive moat. Drivers can have both apps, users can have both apps. You attract drivers by paying them more, you attract riders by charging them less. Uber for now can afford to beat everyone on both those fronts, but eventually they will have to start making a profit. When that happens Lyft is best placed to take advantage.