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Ban on taxi apps to affect over a million customers

Gone are the days when you could secretly book a cab while the party is in full swing, or if you get ‘really’ late in office. Governments across several states have begun to crack down on internet-based taxi providers.

You are not alone. There are about 1-1.5 million people like you who use mobile apps to book cabs regularly who will now have to connect to the call centres, or book cabs in advance. And, most of the cases, there’s a waiting period, long enough to make you unhappy. 

But now the ban takes away the easiest option for cab booking, and about 10,000 cabs are estimated to be off roads across the country, essentially the metro cities.

In India, mobile apps of top eight taxi services have been downloaded about 20 million times (excluding Uber’s 5 million downloads, which include those in other countries where the company operates), most of these being on the Android smartphones, according to data available on Google Play Store. There would be additional number of downloads on Apple’s iPhones and iPads. But, numbers are not readily available.

Experts estimate that the number of active users, who book cabs using these mobile apps regularly, would be between 1-1.5 million. The number of people who use both mobile applications and the call centres for cab booking would be much higher. Most of the mobile app users download multiple taxi service apps on their devices, and many times their mobile application might have been deleted or re-downloaded, which naturally brings down the number of real active users, added the experts.

Radio taxi service providers like Meru Cabs who operate both ways – traditional call centre booking route and direct mobile app bookings – get about 40-50 per cent of their bookings through mobile applications. But these taxi operators will continue to operate through the call centre route as they are recognised by the govt as legal entities. 

The user-base of web-based taxi services has been growing at a rate of 25-30 per cent, according to Rohan Dighe of ViralMint, a marketing and consumer acquisition platform. Just about 10 per cent of registered users of any e-commerce portal are active users, but the number is relatively higher for the taxi service providers because of the nature of the industry, Dighe added.

Even as users acknowledge the lapse by taxi services company Uber in the Delhi rape case, most users say that blanket bans on these service will lead to major inconvenience.

“There have been lapses and one cannot deny that, but a blanket ban on all app-based taxi services is definitely not the way to deal with the situation. You cannot take away a service from consumers without giving an alternative to them,” said Sumeet Kaur, a Bengaluru-based entrepreneur who is a regular user of Uber. “For me Uber was almost life changing because before that I relied auto rickshaws and I’ve faced terrible behavior from auto-drivers. With Uber drivers on the other hand I have never faced any issues, in fact they are always very polite and courteous.”

Kaur, who chose to take an Uber ride on Wednesday night because her husband was not accompanying her, said she has become more cautious after the Delhi rape incident and would perhaps feel unsafe using any radio taxi service at night if she is traveling alone.

Following the alleged rape of a 27-year-old woman executive in Delhi by a driver of an Uber taxi, the central government issued an advisory to states to ensure stoppage of unlicensed web-based taxi services. Over the last two days, the governments of Delhi, Maharashtra, Andhra Pradesh and Telangana have put a ban on Uber and have prohibited all non-licensed taxi service providers.

On Thursday, Karnataka joined the list of states that have banned all non-licensed web-based taxi services. The state had on Tuesday asked all internet-based taxi companies to get registered at the earliest. Failing to do the same, Uber, TaxiForSure, CarsOnRent and ZoomCar have been banned in the state.

However, most taxi services have continued to ply as normal so far, except Uber, which stopped operations in Delhi from Thursday afternoon. Gireesh, who has been a driver with Ola Cabs in Bengaluru for the past six months, says it has been business as usual. He normally clocks 150 kilometres a day and there has been no significant change, even with the ban on Uber.

“All that an online taxi aggregator does is match the supply with the demand. Of course one cannot negate what happened in Delhi, but one wonders if banning all the companies is any solution,” said a prominent technology investor, who has been a regular user of Uber and has even availed the company’s services in other countries. “The bigger concern is about women safety. It happened to be a cab that was registered with Uber last week, but it could also have been any other place.”

A TaxiForSure spokesperson said its business model is asset light, and it works with operators who work with drivers. “Our technological prowess and economies of scale, helps us reduce operating costs and pass on the resulting gains to customers. To ensure our business model also meets the law of the land, we take care to partner with those operators who have valid documents and verifications in place. 

In wake of the recent developments, we are working with our operators closely and are instructing and aiding them to follow the processes and procedures that were discussed and mutually accepted in our meetings with the authorities,” the spokesperson said. 

*Additional reporting by Indulekha Arvind

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