Living the Little Dream[15] – Uberification, Market Disrupter

“The number of customers have increased dramatically since Uber arrived in Nairobi, I will occasionally even pick up clients from Kibera (one of Africa’s greatest slums) through users of Uber.” Stanley, my Uber driver tells me as he drops me safely home after a late work function on Friday night in Naiorbi.

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No doubt, the ride-booking giant Uber has disrupted the taxi transportation system worldwide. It is however very fascinating to note the contrast in its perception received by users in various countries. The top headline relating to Uber in Australia was titled “Uber driver kills passenger’s husband”. On the other hand, an article from the Kenyan news last week describes “Uber…in Kenya is helping create a more reliable taxi service”.

The ride-hailing company started operating in Kenya in the cities of Nairobi, Mombasa, Kisumu and Thika last year. Since then, a price war has sparked between Uber and other players in the market, in particularly LittleCap – a domestic rival backed by Kenya’s largest mobile network operator Safaricom.

The price slash by Uber has prompted other players in the e-taxi industry to lower prices or have value addition to their respective services to keep up with the competition. For Kenyans, the battle for market dominance brings the prospect of cheaper, easier to organise and more reliable transport by taxi. In contrast to government officials in most developed countries, city officials in Nairobi are supportive of this market disrupter. “Although these options [Uber] have not solved all our transport woes, we recognise the fact that they continue to make things better for our residents,” say Mohammed Abdulahhi, responsible for transport and infrastructure at the County Government of Nairobi.

In other parts of the world, the legality of Uber has often been challenged by governments and taxi associations, who claim that its use of drivers who are not licensed to drive taxicabs is unsafe and illegal.

Lawsuits also come from Uber drivers, who occasionally protest against the inability to enjoy employment rights when they practically serve as a worker of Uber. The opinion about Uber remains divided amongst drivers in Australia. In Hobart, where Uber was recently launched, although some drivers hope to reap the benefits it brings, other taxi drivers fear for their livelihoods in the pay cut it may potentially cause them.

While mixed opinion on the online taxi hailing company continues all around the world, all would agree that Uber has created a wave of disruption to the taxi industry. As consumers, such innovative company (Uber are even piloting providing helicopter service in São Paulo!) who continues to strive to provide greater value to their clients can only be welcomed.