In the long-awaited IPO prospectus Uber reported that parent company Google, Alphabet, will be a major beneficiary of the service to order a taxi. Alphabet is one of the largest shareholders of Uber with a share of 5.2%. Such a package can cost more than $5 billion if the IPO Uber, the company’s capitalization will amount to an expected $100 billion
In the documents reported on Uber and other financial relationships with the parent company Google over the last few years, the service has paid Alphabet hundreds of millions of dollars for advertising, infrastructure development and map services.
Despite the investment in in-house mapping projects, Uber still relies heavily on Google Maps. From 2016 to 2018, he paid Google approximately $58 million for map services. They are “critical to work” platform, Uber notes in the section of the prospectus dedicated to risk.
“We believe that there is no alternative mapping tool that would provide global functionality, we need to promote our platform in all markets where we operate,” writes the company.
Uber is also spent on marketing services and software.
For two years, Uber has paid Google $631 million in marketing and advertising, $70 million for infrastructure and software and $1 million for “related services”.
More than half a billion on advertising — noticeable amount for Uber, but a drop in the bucket for advertising machine Google, whose advertising revenue in the last quarter amounted to $32 billion
Google is paying Uber for the promotion. From January 2017, the company spent $3.1 million for the promotion of digital wallet Google Pay through the app for finding a taxi.
In General, companies have a difficult relationship.
In 2013, the Fund Alphabet — GV, which invests in the early stages, have invested in Uber at about $250 million, and the top Manager of Google, David Drummond has even joined the Board of Directors. However, the relationship between the companies became strained when they began to compete in the field of unmanned vehicles, and in 2016, Drummond was forced to leave his post. A year later, Waymo — unit Alphabet on the development of unmanned vehicles — Uber has filed a lawsuit with the accusation of violation of trade secrets, which led to a long litigation ended by settlement in February 2018.
In the documents they say Uber and other judicial victories Waymo. March 26 arbitration in California studied requirements Waymo to Anthony Lewandowski, a former Google engineer and Uber, which has provoked conflict over trade secrets 2017, and ruled that he must pay Waymo $127 million in Uber, which acquired Lewandowski and hired him to lead the project to develop unmanned vehicles, reported that it is unknown whether it should fully or partially pay the settlement amount, which may also include court costs.
In addition, the independent expert on the software, which had to evaluate, were used in the system of an unmanned vehicle Uber any technology Waymo, “found that in our Autonomous car software, some functions cause problems, and others not,” said Uber.
“If these interim findings will be final, they can lead to the need to pay royalties or make changes to the project that will require significant time and resources and may limit or delay production of our unmanned devices,” said Uber before the IPO.
Waymo stressed that “will continue to take the necessary steps to make sure that Uber does not use our confidential information”.
Alphabet not once mentioned in the section on risks for Uber. In addition to the example with the map services Uber says that depends on the app stores Google Play and the Apple App Store and can not guarantee that both companies will start to charge for downloading the app. Waymo is mentioned as a competitor, along with many other companies working on unmanned vehicles.
In addition, Alphabet owned a large stake in Lyft, one of Uber’s main rivals, which was released to the stock exchange last month.
Translation Natalia Balabanchevo
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