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As Uber’s problems in the US mellow out (sort of), its European dramas intensify, begging the question: could Africa be next?
Yesterday, thousands of taxi drivers in major cities across Europe protested against the presence of car-ordering app Uber and other car-sharing services on streets that, until recently, they had pretty much owned. The tech company, which allows users to order cars via their mobile devices, has had some troubling legal issues since its inception but this is the first time there have been protests on this scale.
Throughout Europe, from London to Lyon and Madrid to Milan, thousands of taxi drivers demonstrated against the rise of Uber by grid-locking streets and shutting down major portions of cities. London saw around 10 000 taxi drivers take part in an hour-long protest, which shut down movement through the city.
Currently valued at US$17-billion and operating in over 100 cities in 36 countries around the globe, the company’s European expansion seems to have been the most difficult of the lot. Uber is banned from operating in Brussels, and in Paris its drivers were required to wait 15 minutes to pick up a passenger after a request due to legal squabbles with taxi unions. Though this ruling was later overturned, protests have carried on in the French city, sometimes turning violent. The service was also ordered not to operate in Berlin, but continues to do so after an appeal was lodged with authorities.
What’s all the fuss really about?
“Everyone should play by the same rules,” Richard Leipold, the chairman of the Berlin Taxi Association, was quoted as telling the New York Times. “You can’t have competition between someone who pays all their taxes and someone who doesn’t.”
This is not only a problem for taxi associations in Germany. Uber is welcomed in most markets, as long as it is willing to comply with laws that currently exist and it doesn’t disrupt things. When you’re one of the most disruptive companies on the planet, this is a major problem.
“There’s room for everyone, but you have to obey the law,” Mario Dalmedo, a London taxi driver , told the NYTimes. “Uber isn’t properly regulated. It’s a slippery slope. Quality of life will go down if these services are allowed to operate.”
Uber would argue that it has done more for the economies of the cities it has launched in and created an effective and frictionless service for its users.
“Uber is changing the fabric of these cities. At our current rate, Uber is responsible for directly creating 20 000 new jobs per month and powering billions in economic impact in cities around the world – while also improving the environment, reducing DUI rates and fuelling urban economic development,” Uber founder and CEO Travis Kalanick said in a blog post after its recent round of funding.
Despite this, the protests continue and Europe is out for Uber’s blood.
Its response: launch UberTaxi in London in order to assuage the disgruntled taxi drivers. As an addition to uberX, EXEC and LUX cars, Londoners can now order normal taxis through the app. That’s one way to deal with its pending legal issues.
Being a badass: we see you Kalanick
To be honest, Kalanick does have a very badass way of responding to his many cease and desists (and there are many), some in cities where the service isn’t even available.
“We have operations in every city we have launched,” says Kalanick. “We keep getting these cease and desist letters some from cities we are not even in, like New Orleans. These are just nastygrams, all it means is someone doesn’t like you, not that you are doing anything wrong.”
Be that as it may, there are some existing laws the company must confront if it intends to really take over the world. Kalanick refers to these laws as protectionist, as they aim to protect the existing taxi industry rather than reduce friction and make getting around easier.
“There is a criminal complaint against Uber in Seoul. On this trip, I made a stop there where I was questioned by the police for three and half hours about it,” the CEO said at the LeWeb conference in Paris last year. It’s illegal for Koreans to use his service but it’s okay for foreigners to use it.
Protests and laws (made up or otherwise) are unlikely to stop Uber on its mission to transform ground transportation.
“Four years in, we are just at the beginning of the Uber story. We are working hard to improve what we do every day and are focused on making our great potential a reality,” said the CEO.
Everyone is pretty chilled in Africa, yeah?
Since launching in Africa, the company has not faced any major issues from existing taxi services in South Africa, its first foray into continent. Right now the company’s high price point has remained its big differentiator to other services. With the launch of UberX in Cape Town, which places it in direct competition with normal taxi services (in fact, it’s cheaper than some metered cabs), that could soon change.
Uber will soon be making a play for other African cities, with job ads for Lagos and Abuja suggesting that Nigeria is next on its radar. Rumour has it that Kenya is also on the cards. The aim, a source tells us, is to be in every major city on the continent.
Uber may never have issues in Africa or other developing markets that don’t have stringent ground transportation laws that have been in play for decades. But would it really even matter?
Uber ain’t going nowhere, so get used to it
These protests will likely continue in Europe and other parts of the world may even join but, truth be told, that’s not going to stop Uber. You could make passengers wait an hour for an Uber and require them to perform a pagan dance before getting into the car. They will still use Uber.
Sure Uber could bow to European laws and pay the fees, but it won’t (Kalanick is all business). Chances are, it will carry on doing its thing until the laws change and keep punting the idea that all competition is good. The more taxi drivers protest and stop working, the more people will use its service.
Oh, it also has a pile cash with which it can buy our love and loyalty.