This phrase is one of those business euphemisms used by oasis owners to explain their pricing system to people dying of thirst.
If UBER is getting a 20% commission for each ride, they are making 4–8 times as much revenue with price surging. It’s okay for them to charge more because of a surge in demand. Just be honest about why you’re doing it.
If UBER’s mission was simply to deliver transportation as reliably as running water, they could easily reduce the surge pricing premium, but give 100% of that premium to drivers for staying up late.
UBER‘s gross revenues increase when more drivers stay up late to meet the increased demand of the last call crowd.
More importantly, UBER’s infrastructure — like Amazon — has a fixed cost, so every incremental increase in total rides increases net profitability.
