Firdaus Ariff is a business strategist and executive producer based in Kuala Lumpur, Malaysia. This article was republished with his permission from Medium.
So, here we go again. Another city, another Uber fight against authority. Just another episode in a drama starring Uber.
We all love good drama of course. Especially those with simple, clear narrative — good versus evil, agile startup versus slow bureaucrat, local versus foreign.
But is it that simple and clear cut?
Uber has been in Kuala Lumpur for almost a year now. They started with their flagship UberBlack by hiring local limousine operators. It’s all good at the start — generous vouchers, excellent cars, easy to use app. The prospect of getting a ride in a BMW 7 Series made early adopters very excited. Existing users from other countries simply call for Uber when they’re in Kuala Lumpur.
Enter UberX — with a price as cheap (or cheaper) than taxis, which sent a shockwave to the local landscape. SPAD took notice and said things that’s similar to any other authorities around the world. Uber need to comply with licensing, safety, and so on. Just a reminder, not a crackdown.
MyTeksi, a local cab-calling startup enters the arena. They issued a statement to their drivers regarding an impending “threat to our livelihood”. There’s no mention of Uber by name but the phrase “We shall face this giant head on as One, showing them the indomitable Malaysia Boleh spirit” is a dead giveaway. They even co-opt the occasion of Merdeka to galvanize people to their warcry.
Uber Malaysia didn’t stop offering UberX but they did stop using private cars such as MyVi and switched to licensed limousines. Essentially, they are offering an almost-UberBlack at UberX prices.
However, the move didn’t appease the authorities. Soon after, Director General of Road Transport Department announced a joint operation with SPAD and the Royal Malaysian Police to crack down on Uber’s operation.
Now the grand narrative seems to be properly set up; agile startup versus slow bureaucrats — Uber’s usual framing of the story. On the other hand; MyTeksi positions it as national interest versus “foreign intervention” and protecting the livelihood of taxi drivers.
Time to grab some popcorns and enjoy the showdown? Well, not so fast.
Zoom in
Let’s put aside the media news cycle and go the ground. What do users want? Fast, cheap, and a safe mode of transportation. What choices do they have now? They have regular taxis, as well as taxis augmented by MyTeksi and UberX.
Regular taxis
Truth be told, taxis are a regular punching bag among Malaysians. The chief complaint is a wildly inconsistent service. The car condition can range from super clean to intoxicating kretek smoking den; charge by the meter to arbitrarily exorbitant charges; polite professional drivers to downright criminals.
It’s tempting to lump all these taxi drivers into one category but the reality is they come from all walks of life. On one hand there are people who work as taxi drivers as a last resort, some are just part-timers (including civil servants!). On the other extreme, there are ex-top civil officials (like JKR Engineers) who drive taxis to fill their time and genuinely seek to serve people post-retirement.
MyTeksi
MyTeksi seems to smooth out the wild inconsistencies in taxi service. So far, I’ve yet to find a rude MyTeksi driver. They are a pleasant bunch. In fact, I found one of the most professional drivers ever through MyTeksi.
However, there’s still some inconsistencies such as whether who should pay for the booking fee — some choose to absorb it while some pass the cost to the passenger. Other than that; we can expect that the drivers charge according to the meter, dress decently and drive safely.
In short, taxi service as spelled out in government regulations.
UberX
My first ride with UberX is in a brand-new MyVi. No idea whether the car is owned by Uber or the driver, forgot to ask. The ride is from Avenue K to IKEA with a young male driver and the total charge was RM18 (US$5.51). The small car strained a bit climbing hilly highways but overall the experience was good.
Only when I came back from IKEA with a taxi I realized a critical difference — UberX uses SmartTag lanes while taxis are bound to cash lanes. This create a remarkable difference in experience as it shaves off precious minutes. Imagine how valuable it is when you are chasing a bus trip or an important meeting.
The icing on the cake for UberX is there’s no need to whip out my wallet and fumble with small change. So you can focus on getting your stuff out from the car and whatever you wanted to do next.
P.S.: EasyTaxi reported to offer the same payment service now.
Zooming in between
No internet?
Tough luck, IKEA was super congested on Merdeka weekend so no Internet service. I can’t hail UberX nor MyTeksi. Even though the signal indicator shows full strength with 3G, all packets got dropped and I have to wait until the crowd disperse before able to use either app.
Surge pricing
This is the bane of any service with centralized commercial clout. Uber’s algorithm automatically drives the price up when demand is high (note: surge pricing applies in all Uber markets). On the other hand, taxi drivers at bottlenecks such as train stations and bus stations form mini-cartels to impose a persistent arbitrary surge pricing.
Credit card
Uber requires a credit card and that might be a deal breaker for many. Consumers still fear unauthorized usage or over-charging. Uber has mistakenly over-charged me once but later promptly refunded in the form of ride credit. A recent survey by Nielsen indicates that more than half of Malaysian respondents (55 percent) say they are either hesitant or would not shop online and use their payment card details on either a smartphone or tablet device although their personal information is protected.
Zoom out
Meanwhile in New York, Uber drivers also find their livelihood threatened when the company permanently lowers the price. Furthermore, they also cannibalize other startups such as Lyft.
Uber is also not safe from criticism in their home country. A _Salon_ article argues that “the touted startup is proving to be the embodiment of unrestrained hyper-capitalism.” A. Asohan of _Digital News Asia_ points out in his article that Uber is playing a loss leader game for now to garner support. Once it became a dominant player and demands profit, there’s no telling what will happen.
If Facebook is any indication, it’s not pretty. Once the market is thoroughly saturated, Facebook tightened the flow and started putting up tolls. Page owners are the worst hit with post reach approaching zero percent.
The Future
It doesn’t matter much whether Uber wins or lose this round in Kuala Lumpur. They have super deep pockets and can always come back later. Other startups such as Lyft and Sidecar can also come and try their luck. Even Richard Branson is stepping into the game.
There are also not-for-profit services like BlaBlaCar. You can’t frame them with the usual corporate greed narrative. Currently, 2 million BlaBlaCar members drive 200 miles together each month.
So with or without Uber, things will stil change. And hopefully for the better.
See more: Malaysia’s crackdown on Uber isn’t a total ban
Breaking down the Uber battle in Malaysia
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