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Ride service Uber dials into courier business

An Uber app is seen on an iPhone in Beverly Hills, California, December 19, 2013. REUTERS/Lucy Nicholson
An Uber app is seen on an iPhone in Beverly Hills, California, December 19, 2013. REUTERS/Lucy Nicholson

By Sarah McBride

SAN FRANCISCO (Reuters) - App-based ride company Uber will start delivering on its promise of expanding its business into logistics on Tuesday when it launches a trial courier service, Uber Rush, in Manhattan.

"Better, faster, cheaper," is how Uber's general manager in New York, Josh Mohrer, described the service in a tweet to Reuters. Customers will be able to watch the progress of their packages in its transportation application, much as they can track the progress of the cars they order up on the service.

At first, Uber Rush will work only in Manhattan, but if it catches on, it will expand to other boroughs and perhaps eventually, other cities, Mohrer said in a phone interview. Bike and pedestrian messengers will deliver the packages.

The base cost is $15, with prices rising to as much as $30 for a package that originates on the Upper West Side or Upper East Side and travels to lower Manhattan.

Messengers can only pick up and deliver items, not purchase them, Uber said in a blog post. They won't be able to handle oversized items. All will undergo background checks.

Uber has long held ambitions beyond rides, with chief executive, Travis Kalanick, saying publicly that he thinks of his business as an urban logistics service. But beyond publicity stunts involving delivery of items such as kittens, ice cream and Christmas trees, Uber has yet to provide anything beyond rides.

Uber's outsized goals are part of the reason that investors have poured around $400 million into the company, valuing it at $3.5 billion. With a service that stitches together the buzziest categories in entrepreneurship such as mapping, smartphones and local services, Uber is widely seen as one of the hottest properties in Silicon Valley.

Currently, Uber operates in dozens of cities around the world, ranging from its hometown of San Francisco to Berlin and Tokyo.

VentureBeat was first to report the news of the courier service.

Regulatory and insurance issues have dogged Uber's progress in some cities, such as Miami. Mohrer said he doesn't expect those issues to come into play for the messenger service.

(Reporting by Sarah McBride; editing by Andrew Hay)

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