Opinion: Why the return of Uber is good news for everyone

We will learn what decision has been reached at their relaunch tomorrow, as well as what will happen about their outstanding NT$231 million in fines.

(By Taiwan News)

Uber is finally returning to Taiwan after a two-month hiatus in a decision which will be welcomed by everyone, with the exception of a few vested interest groups keen to maintain the existing status quo.

Uber has swept the globe since it was first launched in 2009. It first arrived in Taiwan to much fanfare in 2013 with actor and TV hosts Alex and Lisa Wang taking a ride to mark the occasion. At the time, Taipei was only its third Asian city location, which was an indication of how positively Uber viewed the free-market economy in Taiwan.

Uber in Taiwan

Since then, it has recorded more than 15 million rides and provided work for more than 100,000 drivers. But there have also been significant issues with the Taiwanese Government, which have hamstrung Uber’s operations here and finally led to their withdrawal from the market earlier this year.

The issue revolved around how Uber was registered in the country. The company registered as a communications company, but Taiwan’s Ministry of Transportation and Communications (MOTC) insisted they should register as a taxi company. In a statement, the company said this would be “like eating soup with chopsticks”.

That was perhaps not the most culturally sensitive of statements, but nonetheless, it got across their point that regulating them as a taxi company wouldn’t work.

Why not? Quite simply, because they are not a taxi company and do not provide a taxi service. Uber provides apps that customers can use to find a car and driver in their area at a price they are happy with. The drivers and cars are not directly part of Uber, but rather operate as partners, and they get to keep the majority of the revenue.

Uber’s international issues

Across the globe, people argue that this constitutes a taxi service, but, across the globe, this argument has fallen down again and again.

In my home city, London, Uber has caused huge controversy in the established taxi community. It is illegal there for any taxi service outside the official black cabs to pick up a customer at the roadside. This monopoly has been in place for hundreds of years argue that their drivers are uniquely trained to do the job and so the monopoly is deserved.

The “knowledge”, which is how black cabs drivers training is referred to, has been rather superseded by the invention of sat-navs and most people don’t care if their driver knows the way, or just puts the address into a sat nav as long as they get there.

The black cab is an iconic part of London, just as Big Ben and the red double-decker buses are, but ask the average Londoner what they think of them and the near universal response you will get is “expensive”.

Getting a black cab in London is unaffordable for most regular people, but prices continue to rise leaving them as the sole domain of rich City workers and tourists.

Uber has challenged this monopoly because users can seek out a nearby car using the app of their phone and be picked up in a matter of minutes. The service is at least as quick as hailing a black cab and most importantly, it is significantly cheaper.

No surprise that Black Cab drivers have held numerous protests and strikes calling for Uber to be shut down, but these have had little impact on the lives of regular Londoners because they never use them. Rather, the argument that has been thrown at Black Cabs, is that rather than complaining, they need to adapt their service to meet the new market challenge.

Uber the pioneering tech company

Similar protests have been seen in Taiwan by existing taxi drivers and companies unwilling to meet this new challenge face-to-face. But pioneering companies have always faced such opposition at the start.

Like it or not, Uber is one of those tech pioneers which has looked at an existing consumer marketplace and developed a business model that has revolutionised it for the better.

Uber’s service is more reliable than hailing a regular cab; it is cheaper; and it is also theoretically safer, as the app retains details of the driver, passenger, and journey which should deter the risks either driver or passenger attacking or stealing from the other.

Uber has done to the taxi marketplace what Amazon first did to booksellers and the retail market, Pixar did to animated movies, and Airbnb did in the holidaying sector.

And Taiwan, an open free market, these new technological developments that offer a better and more cost-effective service to customers, should be embracing. Like King Canute, once the technology is there, you cannot hold back the tide.

So, yes Uber should be paying their taxes and subject to some form of regulation. A sensible compromise can be reached moving forward. Personally, I think it is clear they are a tech company, but it seems we will learn what decision has been reached at their relaunch tomorrow, as well as what will happen about their outstanding NT$231 million in fines.

But don’t let existing vested interests hold back progress in this sector or any other. Progress should be embraced by all and Uber's success is beneficial to everyone in Taiwan, both through the quicker and cheaper transportation is facilitates and the indicators that Taiwan’s free market is alive and open for business.