Uber announced that it will provide drivers for Google Express. Google Express has managed its distribution and delivery operation entirely on its own until now. Google is planning to maintain all aspects of its pricing, merchant partnerships, and storefront while Uber supplies the drivers through what they are calling "UberRush." This partnership will change the industry as we know it. The partnership will change the first and final mile and same day delivery landscapes.
Uber is poised for almost a full upside as it rapidly enters and takes over the package delivery industry. And because Google created the market, Uber will need to earn its way to the table by showing that it can match drivers to the demands empowered by Google and its followers. Let's not forget that Google itself was dabbling in the delivery business, and with this, Uber substantially eliminates Google as a competitor. Can we say "well done" Uber?
Google may appear to be retreating. But it has not given up its future rights to re-enter the delivery scene.
Retailers must be thrilled. In the long run, they will prefer to work directly with Uber because that will also mean that they can delivery (through Uber) any and all of their products, not just those products sold on Amazon.
So what does this mean? Who wins? Who Loses?
UPS & FedEx – Neither company has invested or modernized their business model in any meaningful way. Since Uber's creation of a non-union labor or driver force and its rapid ascent, a collision down the road is likely. Shame of FedEx and UPS for not reacting to this technology attack. They will soon pay the price.
Consumers – Uber will subsidize package delivery, transform it, and in the end customers will reap the fruits of their labor. Uber will force itself as a new player and competitor to FedEx, UPS, and the post office and when they compete, customers win.
Drivers – Many drivers will manage to break free from union centric work environments and experience the beauty of working in free markets that don't fall pray to Unions and their leaders.