Burrito Delivery Makes No Sense

This article is part of the On Tech newsletter. You can sign up here to receive it weekdays.

It’s annoying that everything big companies do is shrouded in mystery and obfuscation. I’ll give you some straight talk.

Why is Uber offering to buy the food delivery company Postmates? Why did a big European food delivery company decide to purchase the owner of Grubhub and Seamless?

Because the economics of delivering restaurant meals in the United States stinks, and the companies involved are trying to make it stink less — for them.

Even if you never order food from your sofa, the roots of this broken system should make us all worry that many of our digital habits are unsustainable mirages.

For people who use it, food delivery can be handy, or even a lifeline. And it makes financial sense in certain cities or for certain restaurants. It might be a lucrative activity in the future, or if Venus were in the fifth house, or if robots delivered dinner, or if restaurants were replaced by grain bowl factories.

But big picture, right now, in the real world of 2020 America, food delivery isn’t working out for just about everyone involved — including restaurants, delivery couriers and certainly not the app delivery companies. They are almost all losing money. Even now, yes, when many of us are ordering more takeout and delivery.

For the food delivery companies, the fastest way to fix this rotten system is to stop spending money in pointless ways and to squeeze more dollars from customers like you and me, the restaurants, the delivery couriers and anyone else involved in this chain of operation.

The way to less stinkage — for the delivery companies — is having fewer but bigger companies that have the muscle to charge more for what they do.

I can confidently predict that if and when more food delivery companies combine, they will say they’re doing so to make our gastronomic lives glorious, to generate more business for restaurants and to construct an Eiffel Tower of hot wings you can see from space. (OK, probably not the last one.)

There will be shreds of truth in those lofty ambitions. But mostly, the goal of food delivery companies is to get bigger so they have the power to charge higher prices. Or, the way to make the finances less stinky for food delivery companies is to make it stink more for the rest of us.

This is where I sigh deeply at all the activities that defy the Darwinian idea of only the fittest surviving. With Uber rides, the global buffet of Netflix, WeWork cubicles and burritos delivered to your door, we have been lured by businesses that can exist in their current form only because they have been artificially propped up with cash. Or prices have been smushed down because the cost of labor has been artificially low.

So maybe it makes sense for food delivery companies to get bigger and charge more. But once you understand that the economics are broken for lots of other kinds of habits that we’ve started to form, you have to ask where this all ends.

If you don’t already get this newsletter in your inbox, please sign up here.


We know by now that technology, like everything else, is never free from politics nor does it necessarily unite the world.

I was reminded of that on Monday when India declared a ban on a bunch of apps originating from Chinese companies, including the popular TikTok short video app, as India and China engage in deadly clashes over a border dispute.

Likewise, my colleague Javier C. Hernández has a bizarre tale of how an opera singer who resembles China’s leader, Xi Jinping, keeps getting censored online because the government scrubs the internet of anything that might provide an opportunity to mock top officials.

And Reddit, YouTube, and Twitch all suspended or banned accounts on Monday that they said broke rules against online harassment or bigoted speech. The crackdown, which included the Twitch account belonging to President Trump, mostly affected figures with right-wing political views. That prompted some hand wringing about whether the companies were legitimately enforcing policy or playing politics.

The trouble when real world divisions intrude on digital life is it grows harder for all of us to separate what’s real from what’s political hogwash.

Should Indians or Americans worry about the Chinese government spying on us through TikTok — as some politicians claim — or is that a bogus explanation for a broader feud between governments? There is a legitimate debate about how to treat speech online, but it has become clouded by concerns that political motivations are behind everything.

The more the internet morphs from a gee whiz novelty to a staple of our lives, the more we see that the digital sphere is subject to the same animosities as real life.


  • A different take on delivery apps: In New York’s Chinatown, fissures over restaurant delivery apps and e-commerce are encapsulating a broader debate about identity, my colleagues Nicole Hong and Elaine Chen report. The pandemic, they wrote, exposed a “long-simmering generational divide, between younger people who believe Chinatown must get with the times to survive, and older ones who worry about it becoming a theme park of Instagrammable desserts and $18 Asian-fusion cocktails.”

  • A different take on TikTok: OK, not EVERYTHING has to be about politics. My colleague Lena Wilson has an endearing look at young lesbians congregating on TikTok to find “friends, solidarity and even love.”

  • This might be fun! Amazon’s Prime Video started a feature to let people watch the same program with friends at the same time and gossip in a chat window about the show or movie. After one company made a web browser add-on to let people synchronize what they’re watching on Netflix, some of the U.S. streaming video companies have started to incorporate this feature, too.

I want to get financial news only from this weird and weirdly informative TikTok account from NPR’s Planet Money. I apologize to all the talented business journalists here at The New York Times.


We want to hear from you. Tell us what you think of this newsletter and what else you’d like us to explore. You can reach us at ontech@nytimes.com.

If you don’t already get this newsletter in your inbox, please sign up here.

http://platform.twitter.com/widgets.js