In Prep for IPO, Uber Makes Payments More Expensive for Its Drivers

canstockphoto18552905Uber has quietly been finding new ways to increase revenue that may hint at a looming initial public offering.

Sources have confirmed that Uber has recently been charging for providing drivers with iPhones in San Francisco, and those iPhones allow for Uber’s crucial payments functionality. IPhones used to be free to drivers, since many don’t have them, but a “beta test” of charging for the phones, begun over the summer, has became permanent recently. We couldn’t get specifics on the rate at with Uber will be charging these drivers, but it will reportedly be around $500 per year for each driver — and that makes Uber’s payments service more expensive for drivers, too.

 

We’ve reached out to Uber PR and will update this story if they respond.

Similarly, in New York, and has been previously reported, the UberX price cuts have made Uber rides cheaper than yellow cabs, which have led to an increase in popularity for the service. The problem? The “overwhelming majority of the price cut” comes out of the driver’s pocket, sources close to Uber have confirmed.

Uber has raised $308.5 million in funding and is worth $18 billion in its most recent valuation.

Charging for phone use — and, by extension, payments — will certainly be lucrative for Uber and keep its investors happy as the company prepares for its impending IPO. Making $500 a year on the iPhone 4S and 5, which Apple has discontinued selling, is a potential goldmine for Uber. One can assume Uber buys them in bulk at an advantageous price. Uber is adding about 20,000 new drivers every month, according to the Washington Post, which means the iPhones should gross Uber about $120 million per year.

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