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UPDATED: June 30, 2014 NO. 27 JULY 3, 2014
Has the Free Market Failed the Taxi?
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Zhou Junsheng (Wuhan Evening News): Taxi-calling apps have faced fierce controversies since their inception, especially when subsidies offered by Tencent's Didi Dache and Alibaba's Kuaidi Dache interrupted the original order of the taxi market. Customers who didn't know how to use these apps complained that they couldn't hail a taxi as drivers refused to pick them up—instead giving preference to those who used the apps—in order to receive a 5-20 yuan ($0.8-3.2) subsidy per ride.

However, if the unified platform is established, the in-car terminals for Didi Dache and Kuaidi Dache would have to be integrated into the government's unified platform. Thus, the core technology possessed by the two companies that developed them would become a public resource; the companies' rights would be infringed upon. This integration would likely be acting far beyond the government's authority.

Free and open competition should be allowed in the taxi market, including using both price cuts and technological innovation to woo more customers. It is the result of market competition that taxi-booking apps have won over customers by offering better deals. However, instead of actively utilizing new technology to maintain their customer bases, some traditional companies are petitioning the government to strengthen supervision of their opponents, indicating that they have come to rely on government protection to stay afloat. Such safeguarding will hamper the healthy development of the taxi business and make it impossible for customers to enjoy bonuses like price cuts, which only arise out of free competition.

The Ministry of Transport only needs to supervise the illicit use of cab-hailing apps and shouldn't interfere with the operation of the companies that develop them. In fact, transport authorities should provide more assistance for the promotion of taxi-calling apps rather than interfering with their platform or usage. Serving the people should be the common pursuit of authorities, drivers, and app developers alike.

Tang Wei (Shenzhen Special Zone Daily): Cab-calling apps have been warmly welcomed by both passengers and drivers, so it follows that the government should be rational and cautious in dealing with such a modern phenomenon.

In New York City, the government had prevented the use of such apps at their advent. However, as the ban violated the interests of a majority of people, courts finally granted legal status to the applications. When the government took proper measures to guide their operation, market order was well maintained.

Taxi-calling apps are on the rise, too, because they represent the latest development in Internet technology and the irresistible trend toward artificial intelligence. Should the government choose not to recognize this movement and forbid such innovation, it would go against the convention of the times.

Finally, as an offspring of the market economy, taxi-calling apps should be allowed to exist so long as they do not violate relative laws and regulations. The government should regulate their usage lightly; too much interference will violate market rules and harm fair competition.

Qiu Baochang (news.xinhuanet.com): Cab-hailing apps are intended to do one thing: Facilitate getting a taxi. However, in reality, they have made it more difficult to get a ride for those who don't know how to use them. It is understandable that the government would take measures to regulate the market in order to let fair competition play its role. However, before taking regulatory measures, the government should do its due diligence, researching the market and hearing the public's opinion in order to make a more open and transparent decision. Using legislation to protect its own interests should be avoided at all costs.

The transport ministry did not predict that taxi-calling apps would have such a big influence on the transportation market, thus took action only after the companies behind these applications had invested in them heavily. Passing such a statement, then, in just two weeks is far too hasty. Numerous discussions should be conducted to render several versions of such a plan, with the public left to choose among them.

To ultimately solve the difficulty of waving down a taxi, integrating cab-hailing apps is far from enough. The government should aim instead to address the fundamental problems behind it.

Email us at: zanjifang@bjreview.com

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