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7 of the biggest roadblocks Uber has hit in Asia so far this year

Discussion in 'Tokyo' started by Dreamer, Jul 3, 2015.

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  1. Dreamer

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    Jan 19, 2015
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    We’re over half way through the year, and it’s now clear that it’s going to be a rough ride for Uber. Across Asia, the US-based Startup

    A startup is a "temporary organization used to search for a repeatable and scalable business model," says Steve Blank, author of Four Steps to the Epiphany. When a business model is repeatable,(...) Term details" class="glossaryLink " style="box-sizing: border-box; border-bottom-style: dotted; border-bottom-width: 1px; color: rgb(0, 0, 0) !important;">startup is this year facing new rivals, new legal hurdles, and all kinds of other roadblocks.

    Uber first entered Asia via Singapore in October 2012. It’s now far from the easy pickings and the smooth motoring of those early days.

    Here are seven huge challenges that Uber has faced in Asia this year:

    1. Major new rivals
    Before we even mention things like regulatory tussles, note that Uber now has more homegrown rivals than ever across Asia. Startups like GrabTaxi and EasyTaxi have for years been making taxis easier to pin down in numerous countries across the continent, but now several new apps are emerging that go after Uber much more directly, taking on core Uber private car services like UberBlack and UberX.

    GrabCar, from the makers of GrabTaxi, is the most ambitious of the new challengers in terms of geographic scope – and Venture capital
    Venture capital is a type of financial capital supplied to startups. Venture capital (VC) firms invest a sum of money in these companies in exchange for equity, which the VC firm can later cash(...) US$250 million in VC fundingat the end of last year (a record for a Southeast Asian startup); in April it emerged that a big chunk of that is being ploughed into anambitious R&D center and a driver recruitment program to ensure the local startup doesn’t lose the platform battle to its American rival.

    Over in India, local startup Ola is expanding aggressively with hundreds of millions of dollars in VC funding, growing across taxis, private cars, and even the country’s ubiquitous motorized rickshaws. Uber fired back earlier this week by launching in seven more Indian cities, taking its tally to 18 cities covered. That’s second only to the US.

    Meanwhile in Japan, the popular messaging app Line started the year by rolling out its latest spin-off web service – Line Taxi. That was initially limited to Tokyo, but by April it had expanded to cover more than 90 Japanese cities.

    Japan is one of the few Asian countries where Uber ties up with licensed cabbies as well as private car drivers. It offers UberTaxi and UberTaxiLux in Tokyo alongside its UberBlack service.

    2. Seoul blues
    Alongside new competitors, Uber has attracted a lot of attention from regulators so far this year. Its biggest fail in the region is in South Korea.

    In May, Korea passed legislation banning private car drivers from operating like a taxi, citing concerns over Uber’s lack of checks on drivers, their failure to get proper insurance, and mobile phone numbers and credit card numbers possibly being “leaked” by the app. This killed off UberX, but it hasn’t hurt the limo-like UberBlack.

    Uber CEO Travis Kalanick cannot risk entering the country to begin negotiations as he has been indicted twice by Seoul’s police force “on suspicion of conducting an illegal business.” The 32-year-old head of Uber Korea was detained by police along with 27 other people in March.

    That move was not unexpected as it came nearly a year after authorities in Seoul said they intended to clamp down on such web-connected services involving private cars – and replacing them with an app of its own.

    3. China raids
    Uber can’t catch a break in its most important market outside the US – China. The company got a wake-up call late in the night on April 30 when police raided the Uber office in the southern Chinese city of Guangzhou. A photographer from the Guangzhou Daily joined police on the high-profile raid.
    The company stood accused of running an “illegal” transport service in the city, where it operates UberBlack, UberX, and UberXL

    Uber’s office in Chengdu, Sichuan province, was stormed by police a few days after.

    No formal charges have been made thus far.

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