Uber versus Didi, OlaCabs and GrabTaxi with Josh Horwitz
With Josh Horwitz from Quartz, we discuss the ongoing major war of the four important on-demand taxi hailing apps: Uber, Didi, OlaCabs and GrabTaxi and how these battles between them are now becoming proxy wars between major corporations, investors and governments in Asia. We dive deeply into various issues regarding these four companies from their app features, revenue and monetisation models, their investors and the way how they differentiate from one another within Asia. We also discuss the recent regulatory frameworks which China has introduced to regulate Uber and Didi and how this might cascade into other parts of Asia.
Here are the interesting show notes and links to the discussion (with timestamps included):
- Josh Horwitz (@horwitzjosh, LinkedIn, QZ profile)
- Uber versus Didi, OlaCabs and GrabTaxi [2:45]
- Introduction: the on-demand taxi hailing apps [3:14]
- Uber – Global [3:22] with UberBlack [4:39] and UberX [4:52]. In the US, Uber is a transportation network company and not a taxi company.
- Asia competitors to Uber – all started by pegging their supply early with municipal taxis unlike Uber. [7:34]
- Reference: “Uber’s biggest Asian competitors have already raised about $7 billion—and could soon merge” by Josh Horwitz in QZ.
- Monetisation models of Uber’s competitors
- GrabTaxi – Top up model [13:40]
- Didi Kuaidi – Commission based models [14:14]
- OlaCabs – Commission based models [14:20]
- User acquisition (drivers and customers) of Uber and GrabTaxi [14:50]
- Investors of Didi, OlaCabs and GrabTaxi are common with Tiger Global, SoftBank, Coatue Management with the sovereign funds: CIC and Temasek (via Vertex Ventures) [18:10] and their investment thesis:
- Local founders building up the company in their respective regions.
- Rapid growth of user acquisition by pegging their supply early with municipal taxis, and Uber has control of the meter unlike the Asia clones.
- All clones of Uber in Asia have no surge pricing capability like Uber. [21:20]
- Potential scenario of Didi, Ola and GrabTaxi to consolidate into one entity to take on Uber. Discussion on why Uber does not buy its competitors in Asia. [23:00]
- Didi-Kuaidi merger as a proxy war for AliBaba and Tencent against Baidu, similar to the recent Dianping and Meituan merger. [25:00]
- Why did Didi invest in Lyft with US$100M or their other Asian counterparts (OlaCabs) to form this part of anti-Uber coalition? [26:27]
- Uber’s reach or metrics vs the Asian competitors: availability in cities, completed rides and daily ride volume. [28:10]
- Uber’s app user experience is better than its competitors from anecdotal evidence on GrabTaxi [32:00]
- Government regulation of on-demand taxi hailing apps:
- Singapore (Khaw Boon Wan, the Minister of Transport on his blog about taxi sharing apps upon taking over the portfolio). [33:30]
- China (China Ministry of Transportation’s draft guidelines with a summary here) as compared to France and Germany. [34:40]
- Variation of legislation on these companies seem to focus on state or provincial level rather than national level, for example, putting a cap on the number of taxis that Uber, Didi can have in China. [38:00]
- France and Germany having a stronger legislation against Uber. [41:00]
- Uber creating proxy wars within governments with protection to taxi companies and encouraging innovations [42:00]
- What happens when the subsidies go for these companies? [43:30]
- Self-driving cars as a wild card that will disrupt this industry. [44:00]
- Introduction: the on-demand taxi hailing apps [3:14]
Podcast Information:
The show is hosted by Bernard Leong (@bleongcw) and are sponsored by Ideal Workspace (Twitter, Facebook and LinkedIn) with their new Aspirus Desk (Twitter, Facebook, Medium) and Linkcious (and check out their other product, Chiibi). Also check out Ideal Workspace’s new standing desk, Aspirus and sign up for their mailing list.