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Uber is taking a page from the Amazon Prime playbook

Daniel Roberts
Senior Writer

Uber’s newest competitive salvo looks a little bit like Amazon Prime.

The ride-sharing company is testing out a subscription service that bundles car rides (its core business), scooter and bike rides (through its Jump e-scooters and bikes), and food delivery (Uber Eats).

It’s another effort by Uber (UBER) to claw back customers from its main competitor Lyft (LYFT), which has gained market share recently. It’s also a reminder that Lyft doesn’t have a food delivery business (it does have e-scooters).

The bundle, being tested at first in San Francisco (Uber’s home base) and Chicago, offers daily discounts on Uber rides (though the company is already warning that some routes are exempt), 30 minutes of free Jump rides per day, and free Uber Eats delivery.

It’ll cost you $25 per month.

An Uber Eats courier is seen in Bucharest, Romania on May 1, 2019. (Photo by Jaap Arriens/NurPhoto via Getty Images)

This is not the same as Ride Pass, which Uber launched last year and which offers frequent riders lower rates for a monthly fee. That offering is limited to rides, no Eats.

The financial calculus here for Uber is clear: lose revenue from Uber Eats delivery fees to acquire more potential loyalists. But it certainly won’t help Uber’s profit margins, and the chief concern investors have with the newly-public company is profitability.

Still, Uber is also likely hoping that the bundle could help make Uber stickier—a person paying a monthly subscription fee is less likely to use a competitor, and that could apply to ride-sharing apps and food-delivery apps. It could be especially helpful in cities that are flooded by all the e-scooter brands, where a scooter rider can choose from Jump, Bird, Lime and Lyft.

Uber won’t be the last to ape Amazon Prime. Expect more hot startups to roll out subscription bundles—even those whose product may not look suited to it. Airbnb, for example, could charge a subscription fee to loyalists who stay in Airbnb’s frequently, in exchange for discounted stays. WeWork is already a subscription service. Nest, the home surveillance system, offers multiple tiers of monthly subscriptions for continuous recording. Which hot tech names will roll out a bundle next?

It’s the continued Amazon Prime-ification of everything.

Daniel Roberts is a senior writer and show host at Yahoo Finance. Follow him on Twitter at @readDanwrite.

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