The longer self driving cars take to completely replace cars, the harder it is for a self-driving only company to compete. You can't run a network with only self driving cars unless you they are all level 5 under all driving conditions (like poor weather) and you literally have hundreds of them in each market you want to compete in so you can guarantee availability.
Customers want reliable transportation. Imagine if your internet company could only provide service when the weather was good. You'd quickly switch to the service that is reliable because being without service becomes unimaginable. This is especially important if you want to compete with car ownership and not just livery services. These companies also need to be reliable on pickup times. If a service take 5 minutes sometimes and 25 minutes at other times, most people will give up on them and go for the 5 minutes all the time service.
It isn't irrelevant in the slightest if their plan is to replace all these contract drivers with automated cars. That would in fact be a long term business strategy. Considering waymo's lawsuit for alleged theft and their large monetary investment in self driving I disagree with being utterly irrelevant.
But if that replacement won't happen for 30 years which seems likely given the tech... One can disagree about timeframes but getting to the last 1000 feet in chaotic urban environments seems challenging.
Business models are based indirectly on available resources. I cannot have a business with a business model that says I want to fly to Jupiter if I don't realistically have the resources (cash/engineering) to do so. Therefore, whether it happens in 10 days or 100 years, the company is directly impacting its balance sheet and business model today by investing money and resources into automated cars.
What could Uber today with the resources being devoted to automated cars? Could the app be improved, could the route optimization algorithm be improved to create more ride shares? I and you won't know because those resources are going towards a different agenda today.
