BY LUKE MULUNDA
On a hot Wednesday morning, a man hired an Uber taxi in Nairobi and requested the driver to take him to a destination outside Kenya’s capital. The customer then unwittingly led the driver to an isolated alley, where other men emerged.
What happened next was not shocking to the driver: the men, who teamed up with the ‘customer’, set his car on fire after he narrowly escaped being lynched.
This was the second attack of its kind in a matter of weeks. Late February, another Uber car was burned by unknown assailants with links to conventional taxi operators in Nairobi.
Right there in the dark alley, a conflict of ideologies was playing out, which has become a sticky issue in Nairobi’s lucrative taxicab business. On one side is the hapless taxi driver and his kind, who have embraced a high-tech way of doing their business of picking and dropping clients. On the other are the guys who set the car on fire and their sponsors, who are rooting for the status quo and revolting against Uber, which is using mobile and online technology to encourage ride-sharing and thus cutting the cost of transport.
Conventional taxi operators argue that Uber’s pricing model is driving them out of business. This model, powered by a downloadable application, has drastically cut what taxis have been charging commuters in Nairobi city and its environs.
Another key feature of the pricing is hinged on a metering gauge that charges users per kilometre, which ensures even fares and thus eliminates the issue of negotiations and cases where drivers inflate charges.
As cab users smile and cheer Uber on, taxi operators have been fuming and slamming their honks as they watch a new entrant overlap them. They have even asked the government to stop the operations of Uber, which has become popular because of its cheaper fares.
Taxi drivers say they are suffering as a result of unfair competition from Uber, which has faced opposition around the world as well, but Uber argues that Kenya’s taxi sector needs to accept the competition and embrace technology. In short, these conventional operators are being told to style up.
The interior ministry and the director of competition are mediating between the rival groups to ensure a smooth integration of the new model.
Incidentally, Uber has become the black sheep of the taxi business globally. Wherever it sets up shop, it’s given a colder shoulder by rivals and, at times, regulators despite the fact that it operates a model of taxi-hailing that reduces the cost of transport by almost half.
Uber is the most disruptive initiative in taxi business across the world lately. The Uber revolution in Kenya, which started early last year, has collapsed taxi costs – from the city centre to Westlands you can pay Sh300, down from Sh600 or even more.
Uber has been blocked in a number of countries or altogether kicked out. In India, its services were stopped after a girl was allegedly raped by an Uber driver in early December 2014. Last year, France’s highest court banned UberPOP, a low-cost ride-sharing service after it was discovered it was using unqualified drivers.
As if that’s not enough, the UberPOP has been outlawed in Italy, Spain and twice in Germany. In Bangkok, Uber was shut after its drivers were not to have registration and insurance needed to operate commercial vehicles.
No fault has been found so far about Uber in Kenya, only accusations of a monopoly in the making and its unwelcome technology. But the protest from taxi operators mirrors the reception Uber got in New York where taxi owners and lenders sued the city and its Taxi and Limousine Commission, arguing that the popular ride-sharing business was destroying their livelihoods.
Uber does not employ drivers or own vehicles but uses contractors with own cars to offer the service. Some see this model presenting unfair competition because it enables Uber drivers to flout the rules and restrictions that govern the industry. Kenya’s taxi business, though, is largely liberalised.
Some argue that Uber also has unfair advantage with its huge investments that can sustain low prices long enough to suffocate competition. Its strategy, they say, is to under-price and drive out competition then over price when the consumer has no other option but them.
“Since they have zero licensing costs, all the risk is borne by the operator,” said Timothy Mayuke, a transport manager at a South African multinational. “The end result will be a drop in quality of service.”
In spite of all the noise and smoke, the issue of technology appears to be getting more accommodative ears, while Uber’s taxi-hailing app is becoming even more popular with the free publicity it’s getting from the attacks.
Recently, Philip Lelei, a photographer with Ron TV International was on the edge as he left a press conference in Kilimani suburb of Nairobi. They were meant to have the photos and video up on social media in the shortest time possible and send some to the media.
Yet Lelei and his colleagues needed to walk almost a kilometre with their heavy cameras to get a taxi. Then Lelei flashed out his smartphone, tapped several times and signalled his collegues to hold on a bit.
“There’s an Uber taxi at that roundabout,” he said after like two minutes. “I just used their app and got a reply that there’s a taxi around here.”
They hailed the taxi and within 10 minutes they were in town after paying Ksh300, half of what the conventional taxi would have charged them. “The best thing since self-service outlets,” he noted, as he picked his Sh200 change from the driver outside I&M building.
That’s how cool Uber is getting for many Nairobians, who for a long time have been molested by taxis whose prices fluctuate depending on the driver’s mood, weather, and in many cases how you are dressed and the colour of your skin. Taxi operators often size up a client before deciding how much to charge, and that’s the freedom that Uber is taking away from their dashboards.
The cabinet Secretary for ICT Joe Mucheru has supported the use of technology to increase efficiency and access to services.
And Uber’s management is unfazed. As their car was being burned, they announced entry in the coastal city of Mombasa. Uber Kenya acting General-Manager Nate Anderson said with the launch, Mombasa joins the list of smart transportation hubs in Africa. “We’re really excited to be launching Uber in Mombasa,” Anderson said. “We will give locals and visitors in Mombasa an affordable, easy and flexible choice to move around the city safely and reliably.”
Uber says the taxi service would help “improve urban mobility in Mombasa [and] reduce traffic congestion and the environmental impact of vehicles at the same time”.
Uber says its technology is open and pro-choice and is keen to offer it to many taxi drivers to boost their occupancy rates and profitability. “We do not feel that it should be about Uber or Taxi but rather Uber and Taxi,” company spokesperson Samantha Allenberg says.
“Many taxi drivers are already using our technology to boost their incomes. We welcome more of their colleagues to join.
The United Taxi Organisation of Kenya’s reaction was unusual in a country known to embrace technology. Kenyans are known globally for pioneering mobile money transfer through the M-Pesa platform run by Safaricom.
But then it mirrors the general trend worldwide where new technologies meet stiff resistance in their initial stages. Some of the technologies that faced resistance include the advent of mobile phones, social media, and even automatic transmission cars.
History is always on the side of technology. Those who fight it often lose both the battle and war and end up becoming the strongest fans. Most companies in Kenya blocked Facebook arguing it was distracting employees and reducing output. These days, they are the most ardent users of Facebook to promote their brands.
Local observers say it was a matter of time, not if, for technology to disrupt the relatively stable taxi business in Kenya and no amount of attacks will stop it. Consumer lobby Consumers Federation of Kenya (Cofek) calls the attacks an organised crime against a legitimate business. “The police should protect Uber drivers as such incidents are instilling fear in consumers and restricting free consumer choice,” said Cofek Secretary-General Stephen Mutoro.
Security will provide a level playing field for Uber and give its taxi drivers a chance to show how their model can work even for its rivals. “We are determined to end this madness where people are maliciously attacking and damaging other people’s property,” says Nairobi Police Chief Japheth Koome.
