Name: Why Uber's Merger with Didi Chuxing Is a Smart Idea
Uploaded: 2019-12-17
Duration: 2 min 11 s
Description: There is a history of big tech companies failing in China.

 ANDREW NUSCA: Uber has merged its Chinese subsidiary with Didi Chuxing, the largest ride hailing service in China. Robert is this a bad sign for Uber? ROBERT HACKETT: It's a great sign, Andrew. Look, Uber has been fighting an uphill battle in China for far too long. ANDREW NUSCA: That's true. ROBERT HACKETT: Foreign internet companies simply don't succeed there. It's too difficult. So kudos, good job, Travis Kalanick. Cut bait, get out of there while you still can. ANDREW NUSCA: Look, I disagree. Yeah, they've been losing a lot of money, but come. On China is a country of 1.35 billion people. There's a lot of people to just leave on the table. I'm not buying this. And what happened to Uber, cutthroat, vicious Uber that would just run into an area and take all the market share? Look, I don't think this is a good idea in the long term. ROBERT HACKETT: Come on, Uber has been blowing tens of millions of dollars every month there for the past couple of years. ANDREW NUSCA: Sure. ROBERT HACKETT: Trying to go up against Didi, and it's just not been working. The project has been doomed from the start. And look, the road that China has paved with the bones of other tech companies that have tried and failed. Google tried and failed. Twitter tried and failed. Facebook tried and failed. Uber also tried and failed. ANDREW NUSCA: Can I just make a point here? It costs a lot of money to try to enter a market. And of course, Uber is going to be losing a lot of money. And sometimes it does pay off. Consider Apple, for example. Apple decided to plow a ton of money into China, and now it has the market share to boot. It's definitely one of the top phone providers among all those native Chinese brands. So look, I think Uber could do this. And it is proven that, in other markets where it's dominated, it's got billions of dollars of collective profit. So if you look at India, for example. India is another place where Uber has been plowing money, and now they have the market share. They're starting to grow it. It's looking pretty good. Why not China? ROBERT HACKETT: First of all, India is a total different market than China. But I'll grant you, yes, Apple has been successful. It is the exception to the rule. It's the tech company that made it. It is the black swan event over there. ANDREW NUSCA: [LAUGHS] ROBERT HACKETT: But if you consider this, Apple invested a billion dollars in Didi earlier this year. So in affect, Uber was going up against Apple. Now that's a position you do not want to be in. It was time for Uber to surrender. ANDREW NUSCA: That's a fair point. For one show that's big in China, come to fortune.com for more Tech Debate.

Why Uber's Merger with Didi Chuxing Is a Smart Idea

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There is a history of big tech companies failing in China.

Uber has merged its Chinese subsidiary, with Dede touching the largest ride hailing service in China. Robert is a bad sign. Fruit is a great sign. Andrew Look uber has been fighting an uphill battle in China for far too long. That's true. Bar and Internet companies simply don't succeed there. It's too difficult, So kudos. Good job, Travis Kalanick, Cut bait. Get out of there while you still can. Look, Look, I I disagree. Yeah, they've been losing a lot of money, but come on. China is a country of one point 35 billion people. A lot of people just leavin leave on the table. I'm not buying this. And what happened to uber cut throat, vicious uber that would just run into an area and take all the market share? Look, I don't think there's a good idea in the long term. Come on, whoever's been blowing tens of millions of dollars every month there for the past couple of years trying to go up against Edie, and it's just not been working. The product has been doomed from the start and look the road to China's paved with the bones of other Peckham he's tried and failed. Google tried and failed. Twitter tried and failed. Facebook tried and failed. Uber also tried. And can I just make a point here? It costs a lot of money to try to enter a market. Of course, over is gonna be losing a lot of money, and sometimes it does pay off. Consider Apple, for example. Apple decided to plow a ton of money into China, and now it has the market share to boot. It's definitely one of the top phone providers among all those native Chinese brands. So look, I think uber could do this. And it has proven that in other markets where it's dominated, it's got billions of dollars of collective profit. So if you look at India, for example, India's another place where uber has been plowing money and now they have the market share, they're starting to grow it there. It's looking pretty good. Why not China? I mean, first of all, India, the total different market, then China. But I'll grant you. Yes, Apple has been successful. It is the exception to the rule. It's the technology that made it is the black swan event over there. But if you consider this Apple invested a $1,000,000,000 indeedy earlier this year, so in effect was going up against Apple. Now that position you do not want to be in, it was time for over to surrender. That's a fair point for one show that's big in China. Come to fortune dot com for more tech debate.