> There is no barrier to entry in ride sharing. Drivers can install multiple hailing apps.
Uber and Lyft have erected barriers by structuring their pay system so that drivers are much better compensated if they do a large number of rides for them. This effectively erects a barrier to entry, because newcomers cannot get drivers as easily.
You're assuming that driving cars is an ultra-tight labour market. That's not a correct assumption. There is a relatively limited number of cars you need to have good service compared to the number of people looking for unskilled jobs in major metro markets, even when unemployment is low in percentage terms. If Uber was hiring an army of specialists maybe I'd agree but loads of people can drive.
On the other hand, if a competitor offers flat-rate payments at the average price Uber pays (= lower than the drivers making the most rides get, but higher than the drivers making the least number of rides get) new drivers entering the market and drivers making few rides should flock to the competitor.
Uber's strategy will only work if those drivers, on average, are worse than the ones making many rides.
Uber and Lyft have erected barriers by structuring their pay system so that drivers are much better compensated if they do a large number of rides for them. This effectively erects a barrier to entry, because newcomers cannot get drivers as easily.