AI ordering tools challenge established food delivery platforms
DoorDash warned Bay Area restaurants that some may have appeared on the smaller Bites delivery platform without their consent. The episode points to a wider contest over whether AI assistants could let customers order directly from restaurants, weakening established apps’ control over the customer relationship.
DoorDash handled 970 million orders and recorded $4.5 billion in revenue in the second quarter, while Bites, a 10-person pre-seed startup, has about 300 restaurants signed up in the Bay Area. DoorDash restaurant commissions range from 15 to 30 per cent per order; Bites charges a flat $1 surcharge and lets diners order through ChatGPT, with orders sent directly to restaurants. One restaurant owner estimated that Bites now accounts for 65 per cent of his orders, compared with 25 per cent from DoorDash, though the article notes that some restaurants received warnings despite not being listed on Bites.
- DoorDash warned restaurants about listings on Bites.
- Bites offers direct ordering through ChatGPT.
- AI ordering could challenge delivery app economics.
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Food delivery customers in the United States typically use apps like DoorDash, which charge restaurants a substantial commission on each order. A new startup called Bites is challenging this model by allowing customers to order directly from restaurants through artificial intelligence tools such as ChatGPT, cutting out the middleman and the associated fees. The conflict between these two approaches raises fundamental questions about how artificial intelligence might reshape business models built on intermediation.
DoorDash is by far the largest player, having processed nearly a billion orders in recent quarters and maintaining an enormous gap in scale over Bites, which is a small 10-person startup with around 300 restaurants in the Bay Area. The difference in their business models is stark: DoorDash takes 15 to 30 per cent commission from restaurants, whilst Bites charges a flat $1 fee and routes orders directly through AI assistants. Restaurants have become central to this contest, as their willingness to adopt new platforms will determine which approach succeeds.
The outcome of this competition could significantly affect restaurants' operating costs and their ability to maintain direct relationships with customers. For consumers, it could change how they order food and what prices they pay for delivery. More broadly, the case illustrates a wider pattern in which artificial intelligence might disrupt industries built on companies acting as essential intermediaries between producers and customers.
Both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
Supporters of AI ordering tools argue these platforms democratise delivery by dramatically reducing costs for restaurants. Rather than paying 15–30 per cent commissions, establishments can reach customers directly through AI assistants for a flat $1 fee, enabling them to compete fairly and retain more revenue. The market data—with restaurants reportedly generating 65 per cent of orders through Bites compared with 25 per cent through DoorDash despite DoorDash's dominance—suggests restaurants and consumers actively prefer this model when given genuine choice, and the innovation benefits both groups through lower prices and simpler transactions.
The case against
Established platforms argue they provide essential, costly infrastructure that justifies their commissions. Processing payments securely, maintaining customer support, handling refunds and disputes, managing logistics, and building trusted brand recognition require substantial investment and operational maturity. Smaller platforms may offer attractive short-term rates but lack the scale to guarantee reliable service, food safety oversight, and consumer protection. The episode of restaurants appearing without consent raises legitimate concerns about transparency; questions also remain whether a $1-per-order model is genuinely sustainable or merely unsustainable venture capital arbitrage that could collapse once funding dries up.
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Originally published by The Verge as “AI could upend food delivery”.