Really depends on if the cost increase is due to Apple taking a cut. Restaurants usually charges more on these delivery apps anyways due to higher fees. It is usually cheaper to call your order into the restaurant and pick up than it is ordering via these app.
Delivery apps are an interesting industry because it seems that no one is making money. Delivery apps are not profitable, delivery people are complaining they are not making enough, restaurants are complaining that they dont make enough via the apps, and customers are complaining of higher costs. The industry doesn't seem sustainable yet it keeps going
The industry is surviving on investor cash…DoorDash founders have already cashed out generational wealth, so they’ll be fine whether the grift collapses or not.
This is not an in-app purchase in the same way a traditional subscription for an app might be processed. This goes entirely through DoorDash, and Apple does not see any % of revenue sent from the user to DD for their order.
Does it depend on that? It will affect the cost to DoorDash, but if the premise of the lawsuit is unfairness of price discrimination based on device operating system, then I don't see how it's relevant to the end customer that DoorDash pays a different cost for their transaction.
That said, I'm personally skeptical that the premise is even defendable in the first place. Operating system is not a protected class and so I don't see any legal basis for why a company couldn't price discriminate based on it.
As a shopkeeper, I can offer a discount for cash rather than credit card. Why couldn't I offer a similar discount for some other device characteristic, especially if there's a direct line between that choice and the economics to me?
If doordash says we charge a X% fee but then Apple charges Y% on top while android charges no fee then logically it should be higher on Apple. If doordash is saying we charge a higher fee on Apple because Apple users are generally wealthier, thats pretty discriminatory.
> Delivery apps are an interesting industry because it seems that no one is making money.
There are a lot of potential industries that have to start out like this.
Suppose you have a downtown where there are a dozen restaurants within a few blocks of each other, and then customers in a residential area on the other side of town. If you try to hire someone to go pick up the food for one person and deliver it to one customer on the other side of town, it's totally hopeless and you'll never make any money.
But if you could get the same driver to pick up meals for a dozen people at once and then deliver them to customers who all live near each other, now you have a chance of turning a profit. That's a chicken and egg problem, because the first customer isn't going to pay the full price of the trip, so you have no first customer and never get enough business going to reach the level of efficiency required.
Now suppose they operate by burning VC money for a while until they get enough usage to turn a profit.
You've simplified the problem too much. If there was one central cafeteria and orders were limited to certain neighborhoods with largeish time windows, then maybe, but that is not really what it looks like. You can easily sign up to drive for one of these services and see the reality of it, but be prepared to stand around waiting for peoples' orders for around minimum wage once you factor in all the expenses and dead-heading time.
Frequently there is a section of town with a bunch of takeout restaurants in the same block. And people want to order takeout for lunch around noon and dinner in the early evening. The app could then assign drivers the customers in the same area as one another, if there were more of them.
The people making deliveries are doing unskilled labor. It was never expected to pay well. The question is if it can work at all.
The apps absolutely already do merge any orders they can. They can't control conditions at the restaurant or on the road however and so a lot of the job is really being a flunky and waiting in line and in traffic which are both quite high around lunch and early evening. It scales very poorly and you probably don't want your order sitting in someone's car for half an hour while they wait for another customer's order.
As far as paying well, I don't think that was ever really expected, but these companies just seem like losers for all but those who managed to cash out in the IPO.
All the food delivery riders I see have carrying capacity for 2 or 3 orders at most - there's no way it's a dozen. Most of the time I'm pretty sure they're only carrying a single order.
But how would they get to that sort of carrying capacity? They almost never use cars around here and I doubt it would be viable (parking issues, cost of vehicle ownership/maintenance etc.).
And if battery prices continue to decline, electric "motorcycles" (i.e. 3-wheeled cars) with low maintenance costs will be available for similar prices.
If that were a feasible option I'd think we'd be seeing at least some already in use (actually the postal service here does use vehicles not unlike that). They still take up a lot more space to park and are subject more to traffic congestion than the e-bikes/scooters actually used.
> If that were a feasible option I'd think we'd be seeing at least some already in use
First you'd need enough customer traffic to fill the vehicle. There is no point in buying a vehicle that can serve 12 customers if you never get more than 4 at once.
Space to park doesn't seem like a huge problem when they're making deliveries. The mail truck is bigger than these things. Buildings with tight parking commonly have a loading zone or a space with a 15 minute limit specifically for deliveries, and it's big enough for a light truck.
It absolutely is for pick ups though, many restaurants in our area have almost no parking available at peak times. The delivery riders just leave their bikes on the footpath/sidewalk.
Larger delivery vehicles can make use of loading zones but even then it'd only be feasible for a very small number of them. My point is there's no sign these delivery companies are expecting to be able to significantly educe costs by combining deliveries and using larger vehicles, and it's hard to see how it would be feasible.
Somebody’s salary is getting paid, a demand is being supplied and while they may not be making enough, there’s enough money to be made to attract deliverers. The music might one day stop, but it won’t be because anybody really wants it to. At the very worst, DoorDash or something like it might be the best way to put in a pickup order.
> restaurants are complaining that they dont make enough via the apps
Is this true? I can't think of any reason why a restaurant would put themselves on the app and spend all of that time managing it (Uber/Skip) if they feel they don't make enough?
This happened back in 2019 with a restaurant I have a stake in. We did not enter into an agreement with Door Dash. Door Dash would call and place a pick-up order. The driver would come in and attempt to pay for the order with a debit card. The card got declined. Another (exactly the same order) gets called in, a different driver shows up - card got declined.
Staff thought it was a scam. They noticed the same type of debit card was used for both orders. Finally a driver informed us it was a door dash order. They scraped an old menu online with outdated prices, and loaded the debit card with the amount they calculated from the outdated menu.
Staff called back the phone number that placed the orders, explained the issue, and let Door Dash know there were 2 orders (sitting for over an hour, no longer saleable) that they owed [amount] for before we would take any additional orders from them, and that they needed to pay in advance over the phone before we would make any more food for them. Horrible experience, would never do business with them.
Some of these delivery apps have gone so far as to create fake websites for restaurants and hijacked Yelp and Google Maps location entries to drive customers to use the app to place their order.
Then they go to the restaurant and say "We're generating this much business for you... if you give us a cut, we'll generate more" and the spiral starts.
We briefly dabbled into running a takeaway in the UK; these apps have changed customer behaviour such that if you’re not on it, you won’t get much business at all. So it’s not much of a choice; and yes ordering from one of these apps practically sucks all profit margin away, order directly from the place if you can.
Its more about marketing and mindshare. What if mcdonalds was on the apps but not carls jr? You'd rather the customer come to you and deny the other business a customer than to not be there at all
Delivery apps are an interesting industry because it seems that no one is making money. Delivery apps are not profitable, delivery people are complaining they are not making enough, restaurants are complaining that they dont make enough via the apps, and customers are complaining of higher costs. The industry doesn't seem sustainable yet it keeps going