[bblost]

Originally Posted by deehunk

An example of day light robbery by Ola, have just shared the fare estimate below to my home from office. The estimate is for Uber pool and Ola share.
Uber fare feels realistic, Ola

Its a robbery when Ola forces you into their cab and makes you pay at the end of the trip.

Here they are offering you a choice.
Either pay this amount and travel or find something else.

[rkg]

Originally Posted by shyampsunder

2. The state government's rules are extremely archaic and unfair. For example, they say mandatory physical installation of GPS with GPRS. Today none of the local cabs or autos have it but forcing only the taxi aggregators to implement it is wrong. If their intent is to level the playing field, they should be fair in doing so.

Radio Taxis already have mandatory GPS since one or two years. It is not new or specific to aggregators

[Chetan_Rao]

I have nothing particular to say for or against the situation, but it would be prudent to remind everyone involved that 'let the market regulate itself' doesn't always end very well, sometimes disastrously so.

An off-topic example, but has everyone already forgotten the banking sector shenanigans of 2008? Not an apples to apples comparison (before someone screams 'irrelevant') and not necessarily a battle-cry to regulate everything to death, but a stark reminder of what could (and often does) go wrong in a self-regulated market scenario allowed to run amok.

[binand]

Originally Posted by chandrda

Even the Famed Black Cab of London or NY Cab is licensed and heavily regulated in terms of area where they can operate, fare and driver qualification. These are the so called Capitalist Country. Then why cannot India have a properly policy to regulate the cab operator.

I don't know about NY; but in London Uber thrives. In fact Guardian recently came up with a long, well-researched article on how Uber conquered London.

Originally Posted by chandrda

Question is when I walk into the Barbeque Nation, suddenly they say the buffet is Rs.799 x 6 + tax due to surge pricing, but you cannot see even a single customer and don't understand how they manage the surge pricing.

You needn't understand the pricing of a product or service to decide whether to make use of it or not. Your decision should almost always be based on the value you get from using the service vis-a-vis the opportunity cost of foregoing the service. You don't see the value of a surge-priced 5km trip that will cost you Rs. 500? Then by all means take a rick or a bus. Why would anyone fly from Bangalore to Chennai paying Rs. 3000 when the Shatabdi can take you there at Rs. 700? But there are people who do so - those who see value in flying.

Originally Posted by chandrda

End of the Day no one should be above the Law of the Land.

End of the day the law of the land should not be capricious or whimsical. Law of the land has to follow (a) consitutional principles, and (b) the vision for the nation as espoused by the government du jour. Price control for what is a discretionary expense fails on both counts.

Originally Posted by chandrda

Uber/Ola should not interpret the Law in the way which is beneficial to them in the long run. It should be level playing field for all, so that competition can thrive and innovation/technology keeps on evolving. Competition should be encouraged either by Law or by Force so that there is no monopoly and one individual hold everyone to ransom.

Right now the market has very little barrier for entry. The underlying technologies are mostly open source, datasets are free to access (not sure about mapping data though) and there aren't any customer lock-in mechanisms. In fact, what the government is doing here is creating an artificial barrier to entry (high compliance costs), thereby encouraging monopolistic practices.

And btw, bulk of civil lawsuits boil down to different parties interpreting the law in ways that are beneficial to themselves, and the courts being asked to arbitrate.

[TD_GHY]

Not supporting or against surge pricing as such, but I hope the current ardent supporters of Uber/Olas don't cry foul later when they monopolize the taxi market by wiping out all black/yellow cabs and begin to "charge" and "treat" passengers the way current taxis do, after the investor money runs out and they need to burn their own cash. Till then, let's support them and enjoy the low fares and relatively better service

[msdivy]

Originally Posted by binand

Your decision should almost always be based on the value you get from using the service vis-a-vis the opportunity cost of foregoing the service. You don't see the value of a surge-priced 5km trip that will cost you Rs. 500? Then by all means take a rick or a bus. Why would anyone fly from Bangalore to Chennai paying Rs. 3000 when the Shatabdi can take you there at Rs. 700? But there are people who do so - those who see value in flying.

That is the bane of current biz model of Ola, Uber - I have to do price-value analysis before every ride. The traditional channels - auto, radio taxi or own vehicle, the price is mostly fixed for a given distance - is like a commodity. Uber, Ola are trying to create extra margin over this commodity offering, by trying exploit the variable pricing. Customers might not like this strategy and might alienate the customers in the long run.

[binand]

Originally Posted by msdivy

That is the bane of current biz model of Ola, Uber - I have to do price-value analysis before every ride. The traditional channels - auto, radio taxi or own vehicle, the price is mostly fixed for a given distance - is like a commodity.

I said opportunity cost - not price. This should include cost of cancelled bookings or delayed trips, hidden costs, risk to life and property, personal comfort and convenience and many others - the true value of the service is known only to you, and perception of value is different for different folks.

Price fixed irrespective of environmental and contextual concerns - is price regulation. The traditional channels have been commoditized precisely because of this price regulation, leading to no avenues for differentiated pricing and service levels and hence, no innovation.

[alpha1]

Originally Posted by rkg

OLA and UBER were arguing that there are no rules for aggregators, hence it is not their fault.

Thats why government brought new rules and regulations.

New rules? Or old rules forced upon new situation?
Anyway, I have made it pretty clear that rule and regulations needs to change with times and situation. Otherwise people can today justify the barbaric laws of past centuries.

Off the topic, if your logic that there should no regulation, why should we have uniform metric system of measurement? Why not allow each shop fellow to their own measurement system. People can argue in the same way "if you want to buy go ahead do it on my terms, otherwise go to another shop where you can get as per your terms".

Or else it can be phrased like

"if you can afford to buy at my terms buy or forget it" just like Uber/Ola are saying.

Metric system is not a regulation. It is a standard followed for ease of doing business. The choice is still buyer and sellers. Does metriculation bring in resource wastage? Higher prices for buyers? Lower profits for sellers? Less convenience for consumers? Less flexibility for sellers?
No.

But Govt's regulations with respect to price fixing does exactly all of the above.

Originally Posted by chandrda

I couldn't resist myself from reacting to some of your explanation here -

Even the Famed Black Cab of London or NY Cab is licensed and heavily regulated in terms of area where they can operate, fare and driver qualification. These are the so called Capitalist Country. Then why cannot India have a properly policy to regulate the cab operator. Please check on google, most of the Countries either have dispute or have/had banned Uber service and forced them to obtain license, pay tax etc... Why India should be Different in this case?

https://en.wikipedia.org/wiki/Legal_...er%27s_service

I think you have missed my posts of before.
Even in the mighty US, a person has to win votes and get elected.
Going through this thread, as a politician it makes sense for me to impose price controls in everything, and I will win elections.

Remember that people buy lots of stuff but produce (or sell) only one stuff in their lifetimes. Hence, it is natural that they want all the goods and services for free, but want their salaries to be the highest - totally unaware of the point that each good/service that you buy is someone's salary or profit only.

Everyone is extremely shortsighted, and their votes also tend to behave that ways.

Question is when I walk into the Barbeque Nation, suddenly they say the buffet is Rs.799 x 6 + tax due to surge pricing, but you cannot see even a single customer and don't understand how they manage the surge pricing.

So that is their freedom! They want to become more exclusive and out of reach from most diners.
It is your freedom to walk away from such places and go which offers better value for money!

The point is that BOTH have freedom. What you are suggesting of imposing fixed fares removes that freedom.

Imagine a situation where Uber has killed all the competition with current practice in 5 years time and then starts dictating terms/price which is simply un-affordable? Have a long term perspective...

How will Uber maintain its monopoly with high prices in future?
Or you feel that the startups are a recet short lived phenomena of the 2010-2020 decade only?

[ayadalam]

Companies like Ola and Uber definitely have brought about a lot of positive changes in the commute landscape. However, no one is above law.

1. Definitive background checks to ensure that one feels safe using the service even at odd hours is mandatory. Lot of our folks still fear using this service even at day time let alone at odd hours.

2. Definitive regulation of services offered is needed to ensure that end users are not harassed through things like obnoxious levels of surge pricing and hold commuters at ransom.

3. Within certain geographical limits, the operators need to ensure that there is no deficiency in service. Many times at the very last minute they give flimsy reasons and do not take the commuters to their end destination.

4. Have had an opportunity to use such services outside of India. Lot of places, they are extremely safe and the taxis are tracked using GPS by parent companies. They have put in strong checks and balances to ensure that the service is safe and near fool proof.

5. When it comes to pricing, travel distance and wait times are definitive constituents of the overall pricing. However, they need to be reasonable so that it is a win-win for both the taxi drivers as well as end commuters.

We definitely deserve a convenient, hassle free, reliable and a safe service.

Cheers !!!

[deehunk]

Bblost, I just showed the difference in fares for similar location between 2 competitors. This is why it is better to have a regulation in place.There are people like me using a taxi for genuine reasons and not just that we have surplus money. Yesterday both Ola and Uber drivers asked me to get out of the cab after asking drop location. But there are some honest people still out there, I found an Ola driver who switched to 'mini' category as he had not got enough trips from morning. He dropped me at my house without any complaints although it was raining heavily and there were traffic jams all along the trip. The regulation may discourage lazy drivers making a mockery of incentive system which are based on number of trips and not distance.

[binand]

Originally Posted by deehunk

Bblost, I just showed the difference in fares for similar location between 2 competitors. This is why it is better to have a regulation in place.

That is a non sequitur. There is usually a difference in price for similar cars made by 2 competitors; does that mean car prices should be government controlled?

Or, in a service context: different restaurants serve meals at vastly different prices. So should government regulate restaurant meal prices?

[deehunk]

Surcharge has been suspended by Ola from yesterday evening, it is upto these app based facilitators to decide whether they are sequitur or non sequitur.

[abhishek46]

Originally Posted by Mithrandir

Is that Rs 19.5 per km? The 'minimum' fare in an auto rickshaw here in Udupi (coastal Karnataka) is Rs 25. That is, if you hire an auto and get down after moving say 50 yards you still have to pay Rs.25. A 2 km journey will cost you Rs 50. If it is a less populated area, then you may have to pay the auto driver some extra fare as the he will not get any passenger on his way back to his auto stand!. Where is the rule governing the auto fare?. Are we not part of the same state? If govt. wants to control the big business why cant it control the auto drivers? Scared of their unions?

Minimum fare is Rs25. That is not the rate per km. For auto, the rate per KM will be lower than the Rs19.50.
For an Auto the minimum fare like say Rs25, includes 2KMs of usage also.

Auto walas are overcharging because people do not want to get into hassle of quarreling with them & have no choice in many cases.
As per Govt. there are proper rules for Autos also. If any time you find Autos denying service or over-charging, you can call the traffic police as per law. (Ok, what happens next may be fishy).

The point is, it is difficult to implement the law because there are so many auto walas in an un-organized business. Whereas, OLA & Uber are organized business, so they are easier to target for law violations.
Noboby is scared of anyone really. Govt. has enough muscle to crush Auto Unions. Due to presence of BMTC and so many taxis, the effect will be less of Auto union strikes, atleast in Bangalore. The real thing is, Govt. does not want to put in the efforts in the first place.

[phamilyman]

Originally Posted by shyampsunder

1. In spite of the government fixed fare being 2X-3X more than current rates of Uber and Ola, they are protesting against it. One of the reason is obvious that it restricts their flexibility in pricing. Right now they are heavily incentivizing the drivers during peak times to keep driving and slowing increasing the surge pricing to eventually make sure they don't have to pay out incentives but the drivers keep earning as much. This upper cap is a obstacle to that plan. Another reason which is less obvious is that it sets a precedent for state intervention in aggregator market. Today Karnataka is setting a reasonable amount of Rs 19.6 but tomorrow some other state might set a much lesser amount and the aggregators will have their case weakened because of the legal precedent.

I think we are missing some basics. Given the experience of governments in regulating auto or taxi fares in most parts of the country, it is safe to say that they fail more often than not (except in Mumbai).

First 6-8rs/km works out to practically 10-13 rs/km in the end. If you include incentives, the actual per km cost even today is far in excess of the 19.5 rs/km offered by government. Reasonable number? I don't think so.

Plus a flat cap is great in theory but a nightmare to implement. e,g 19.6 rs/km isn't enough if a driver only drives 50km/day thats why cabbies earlier would only take long rides and no short ones (or would charge a bomb for it). Or for someone to take an auto from andheri east to west / station at 6pm. Atleast Uber thinks about a driver's take home pay when finalizing incentives - that is big picture end to end thinking which is responsible for their growth.

Plus the government misses that a vibrant transport system (esp cities like Mumbai) results in a sharp pullback of demand from uber when they surge. The government should be bothered about creating liquid markets with reasonable service levels - something ola/uber have done. Govt is unnecessarily killing the golden goose by focusing on the easiest most visible to legislate item - price.

[avdhesh15]

Pricing should be independent in my opinion. Customers have a choice - there was life before aggregators and there is life beyond them. Where the government should step in is making a blanket safety policy across service providers, be it aggregators or radio cabs or regular cabs or autos.

"But hey! That's a tough job. So then, let's put a cap on the price" - I find this as illogical as the ban on the 2000cc diesel ban without data (read tsk1979's post on this subject).

Let me give my example: being a consultant, I used to be on early morning flights on a very regular basis (I live at a short distance of 10km from Mumbai airport in Lokhandwala). I started with radio cabs but 9 out of 10 times, they would cancel last moment thereby leaving me with the only option of taking an auto. Post this phase, I used to book the round the corner cool cab which used to charge me 300 bucks and again uncertainty would prevail of his presence. With Ola / Uber, I am literally guaranteed a ride in the mornings for as less as Rs 150 without any rude shocks. Never have I not got a cab since past couple of years and have saved money, stress and inconvenience.

My two bits.