There are no free lunches.
Cab situation in the 90’s: Only yellow black taxi’s available:
Advantages:
1. Cheap
Disadvantages:
1. Poor service
2. Bad state of cabs
3. Unsafe
Cab situation in the 2000’s: Entry of meru & other radio cabs as an alternate choice:
Advantages:
1. Better service
2. Safety measures enforced
3. Better quality cabs
Disadvantages:
1. More expensive
Radio cab services like meru are more expensive due to the extra input costs going into better cabs, training of drivers, infrastructure like parking space, setting up helplines etc.
Current Situation: Entry of extremely well funded ‘taxi aggregators’ like OLA & UBER
Advantages:
1. Better service
2. Huge discounts
3. Easy to book
4. Better quality cabs
5. Better safety than yellow & black cabs but less than radio cabs like meru
Disadvantages:
None visible. Really??
Future Situation:
1. Radio cabs like discounted out of the market with market monopoly for Uber/Ola
2. Discounts withdrawn with price controlled by Uber/Ola
Advantages:
1. Convenience
Disadvantages:
1. Expensive fares
2. No competition
3. Safety?
Unless taxi aggregators are required to invest in infrastructure like parking, training of drivers, safety standards, help lines, in the long run, they will end worse for the common man.
Most of the 1 billion dollars invested in companies like UBER/OLA is not being used to improve services to customers but to ‘acquire customers’ through discounts, branding, marketing & quick expansion.
As some of you ‘acquired customers’ would notice, discounts on sites like Myntra, Flipkart etc starting to disappear. It’s not long before they do so at Uber/Ola. Will choices like Meru exist then?. There are no free lunches!