September 11, 2017
London’s Uber Rival Gets The Boot
Ride sharing service Uber has faced tough challenges everywhere it has pioneered. Local governments and taxi unions have slammed the company, tried to block it and fought Uber in court. Sometimes Uber won. Sometimes they lost. Sometimes they just kept operating anyway. Now, though, it seems like ride-sharing was winning, by popular demand if nothing else. Uber and Lyft had blazed the trail and taken the proverbial bullets. Now the market had shifted. At least, that’s how things looked. But that may not be the case.
Recently, an Uber rival called Taxify has been forced off the roads in London, less than 72 hours after the company opened for business. Taxify reps released an immediate statement, saying they had to “temporarily stop operations to clarify (our) legal position with the regulator and reach a resolution so that services can return to normal…”
This sounds very similar to the sort of thing Uber was faced with, but now the ride-share pioneer is on the fence. Less competition is better for Uber … but more government regulations and new legal precedents is certainly not.
Meanwhile, Transport for London, the agency responsible for regulating the city’s transportation network, agreed it had required Taxify to stop taking bookings and delivering service: “The law requires private hire bookings to be taken by licensed private hire operators at a licensed premises, with appropriate record keeping…” Meanwhile, it appears Taxify is confident it will be able to resume business soon. The app was still available for download, though users were greeted with a terse “no drivers available” message if they tried to book transportation.
In the end, this situation may, once again, be decided by popular demand. Over 30,000 UK residents snapped up the app shortly after it was released. Now, those potential customers are waiting to see what will happen. So, demand is clearly on the side of Taxify. And that demand may transition into political pressure if these prospective customers feel Taxify is being strong-armed or treated unfairly by regulators. Taxify may be new to England, but the app is not new. The company started operations in Estonia four years ago, billed as an even lower cost alternative to Uber and Lyft. Since 2013, Taxify says they have built a customer base north of 2.5 million in 19 countries (and counting). In addition to launching in London, company reps say they plan to open for business in Paris this year as well.
And that’s not the end of the good news for Taxify. A Chinese ride-sharing company that beat Uber in China said they plan to invest in Taxify to help the company expand. But, while they have the financial and consumer support, Taxify still needs to clear the hurdles leapt by Uber in London if they want to compete for the lucrative British market.