Uber and OLA Surge pricing banned by State Govt

Something good from KA govt, yay

OP seems to Uber/Ola Partner

@swaroop.ms Thanks for sharing this here, bro!

@lootbaba wrote:

OP seems to Uber/Ola Partner

Haha no. But I am wondering what next. If they can’t survive and still have to abide by this, then they may decide to shoot up the normal fares making it tough for the common man and the common man may go back to thinking of taking an auto vs cab like old days.

@getready wrote:

Something good from KA govt, yay

Momentarily it may look good but not sure what will happen in the long term.

OLA N UBER Havnt commented anything on this yet and still nothing seems to be done on this ,so i can’t expect this to take a twist before it is implemented

What you see on the article is a set of guidelines issued by KA government. Unfortunately, it has not been passed into a law yet. Be rest assured, Ola & Uber will come up with something innovative to counter this move by KA government. I became a victim of surge pricing at 4:30 am today near Koramangala, Bangalore. Had to shell out 1.4 X surge for a Ola prime car. 10 kms ride costed me 280 rupees. Uber was at 3.9X surge pricing at the same time in-spite of having around 7 cabs at the same location.

@cybertechie wrote:

What you see on the article is a set of guidelines issued by KA government. Unfortunately, it has not been passed into a law yet. Be rest assured, Ola & Uber will come up with something innovative to counter this move by KA government. …
…

There are not guidelines, bro. This is a rule now!

“State Transport Authority, says: “They have to set up a system accommodating the new policy. But we cannot take action unless a passenger complains of the high charges.” Violation of this rule will result in licence-cancellation and penalty of up to Rs 10,000. However, the penalty is imposed on the licence holder, who is the owner-driver registered with the platform, as neither Ola nor Uber has taken an operator licence in Bengaluru…”

Source: http://yourstory.com/2016/04/slashing-surge-cab...

By the way, I fully agree that Ola/Uber will protest and come up with some way to bypass/compensate for this change.

Had read that yourstory article yesterday

India cannot afford the luxury of zero government regulation of cab aggregators. But, as Jaspal says, driver-partners who are active on a daily basis are only 30-40 percent. So the slash in surge price will lead to short supply and may hurt the consumers more than these platforms

"@DealSeeker":http://www.desidime.com/users/209542 wrote:

There are not guidelines, bro. This is a rule now!

“State Transport Authority, says: “They have to set up a system accommodating the new policy. But we cannot take action unless a passenger complains of the high charges.” Violation of this rule will result in licence-cancellation and penalty of up to Rs 10,000. However, the penalty is imposed on the licence holder, who is the owner-driver registered with the platform, as neither Ola nor Uber has taken an operator licence in Bengaluru…”

Source: http://yourstory.com/2016/04/slashing-surge-cab...

K but how do users report this ??

anyways im fine with surge as the service from cab aggregators has made a massive change in way to commute in bangalore specially !!

NO MORE RICKSHAW HARASSMENT

"@saymyname":http://www.desidime.com/users/429670 wrote:

Had read that yourstory article yesterday

India cannot afford the luxury of zero government regulation of cab aggregators. But, as Jaspal says, driver-partners who are active on a daily basis are only 30-40 percent. So the slash in surge price will lead to short supply and may hurt the consumers more than these platforms

Yes its a downside for the user’s n drivers !!

creating a level field in this sector will just kill the sector completely

I remember Karnataka government local bus- BMTC charges one and half of the ticket charge for midnight ride. Will they remove that charges too.

@Dr€@m(h@$€R wrote:


NO MORE RICKSHAW HARASSMENT

Han wahi toh.. The first time I went to Bangalore the Rickshaw guy robbed me saying that the place which I was mentioning was far and he then took some other route to reach to that place…

AT THE END OF THE DAY ; MY GUT FEELING SAYS THE CONSUMER WILL B AT LOSS

@DealSeeker wrote:
There are not guidelines, bro. This is a rule now!

I stand corrected. This law has indeed been passed by KA government on 2nd April. The last time i read about the same topic was during Feb 2016 when KA government had issued draft guidelines pertaining to taxi aggregators. I’m glad to know that it has been implemented. Seems like Uber/Ola is not aware of the new rules since Ola has charged me 1.4X surge today.

@Dr€@m(h@$€R wrote:
anyways im fine with surge as the service from cab aggregators has made a massive change in way to commute in bangalore specially

Completely agree with you that Ola/Uber has changed the way we hail cabs but having said that, there needs to be a ceiling on surge pricing. Like i mentioned in last post, Uber surge pricing was 3.9X today at 4:30 am. Imagine someone taking a ride to Bangalore airport( 40kms) at that hour. He would need to shell out 4,000 rs for the ride which is absurd. KA government has fixed a slab of 19.5/ km for AC cabs during day hours and approx 25 rs/Km at night. If Ola/Uber wants to continue with surge pricing, they should ensure that final fare after all surge pricing, ride time charges doesn’t go above the Government recommended fares.

@Dr€@m(h@$€R wrote:

AT THE END OF THE DAY ; MY GUT FEELING SAYS THE CONSUMER WILL B AT LOSS

Consumer will not be at loss. I hate surge pricing since it is totally unpredictable. There is no set guidelines when surge gets activated. With other operators such as Meru fares are predictable due to fixed tariff( night charges etc)but when it comes to Ola/Uber, they add ride time charges/ surge charge/ distance surcharge etc etc to final fare. Ola keeps sending me Sms/email advertising OLA share which costs 50% off regular mini fare. After checking ride estimate i realized Ola share is giving only 10% discount on Mini fare. Why would i share my cab with 2 other passengers for a paltry 10% discount?

@cybertechie wrote:

@DealSeeker wrote:
There are not guidelines, bro. This is a rule now!
…

I stand corrected. This law has indeed been passed by KA government on 2nd April. The last time i read about the same topic was during Feb 2016 when KA government had issued draft guidelines pertaining to taxi aggregators. I’m glad to know that it has been implemented. Seems like Uber/Ola is not aware of the new rules since Ola has charged me 1.4X surge today.

"@cybertechie":http://www.desidime.com/users/13105 wrote:

Completely agree with you that Ola/Uber has changed the way we hail cabs but having said that, there needs to be a ceiling on surge pricing. Like i mentioned in last post, Uber surge pricing was 3.9X today at 4:30 am. Imagine someone taking a ride to Bangalore airport( 40kms) at that hour. He would need to shell out 4,000 rs for the ride which is absurd. KA government has fixed a slab of 19.5/ km for AC cabs during day hours and approx 25 rs/Km at night. If Ola/Uber wants to continue with surge pricing, they should ensure that final fare after all surge pricing, ride time charges doesn’t go above the Government recommended fares.

Yup SURGE LIMITATIONS r necessary but i have serious doubts about how this is going to come in effect !!

Surprise to see that some ppl says uber ola did good inspite of surge , statung reason that ricksaw guys charge more .

In Delhi or any other metro city if any auto driver ask to pay 20-30rs more or 20-50% more charge we feels like robbed and complaint that and sometime Make a social issue now they trued to charge more by taking long routes . but can you think liitle more how much more they charged us ?? See this -

Both auto and cabs are CNG based in Delhi
Mileage of cabs is little more than auto on CNG
There is no per minute riding charges
If we includes ride time charges fare of cab is more than auto at same cost of fuel . operating cost may be high for some other aspects but not fuel .
Till this we can say cab is good .
But when there is surge up to 5 times or say 500% of original fare and same time auto just ask little more not more than 2 times . we thinks paying to cab is status symbol but to auto driver is fraud .

Same way like we use to bargain from roadside nariyal pani vendors or vegetable seller but in malls we buy at price tag and seeing 10-20% discount is like loot .

Surge pricing can’t be justified to 5 times more fare and that too when many cabs are there .

In February, Bengal became the first State in India to define guidelines for operation of “On Demand Technology Transportation Aggregators”.
App-cab companies Ola, Uber, Meru and TaxiForSure were handed licences on along with a 90-day deadline to install CCTVs and alarm buttons in their vehicles, failing which they would be barred from operating in Calcutta. Vehicles operating under each company would need to display a logo or insignia to distinguish them from the other fleets. In the event of an incident, a company operating app-based cabs can’t pass the buck to the car owner. Similarly, the owner of a taxi can’t pass the blame to the driver. By virtue of being the licensee, he/she would be held responsible as well.

So the State Govts are gradually catching up.

well regulation to some extent is current if the regulation space is to make sure the security of people. Even my office Cabs have the emergency buttons.
coming to the surge pricing, it’s a free market and a competitive one. Unless all the Cabs strategize to loot us together, it seems wrong to regulate the surge price. Let the people pay the money when they want the cab more or let them use other means.

@goyal.dkg wrote:

Surprise to see that some ppl says uber ola did good inspite of surge , statung reason that ricksaw guys charge more .

In Delhi or any other metro city if any auto driver ask to pay 20-30rs more or 20-50% more charge we feels like robbed and complaint that and sometime Make a social issue now they trued to charge more by taking long routes . but can you think liitle more how much more they charged us ?? See this -

Both auto and cabs are CNG based in Delhi
Mileage of cabs is little more than auto on CNG
There is no per minute riding charges
If we includes ride time charges fare of cab is more than auto at same cost of fuel . operating cost may be high for some other aspects but not fuel .
Till this we can say cab is good .
But when there is surge up to 5 times or say 500% of original fare and same time auto just ask little more not more than 2 times . we thinks paying to cab is status symbol but to auto driver is fraud .

Same way like we use to bargain from roadside nariyal pani vendors or vegetable seller but in malls we buy at price tag and seeing 10-20% discount is like loot .

Surge pricing can’t be justified to 5 times more fare and that too when many cabs are there .

well said , but why should the drivers be held liable for surge pricing and not uber/ola?

THERE IS NO LAW IN INDIA – Advocate

all taxi companies are frauds

just now tried to book uberX and it is asking surge of 4.5X making it 35/- per km + 4.5/- per min
it will cost almost 50/- km

Edit – I never used more than 1 free ride of Uber so they are taking money from me for all the free rides they were distributing.

an uber driver told me that the profits from surge pricing goes to the driver and not the company. is this true

“@…A… ":http://www.desidime.com/users...69 wrote:

THERE IS NO LAW IN INDIA – Advocate


all taxi companies are frauds

just now tried to book uberX and it is asking surge of 4.5X making it 35/- per km + 4.5/- per min
it will cost almost 50/- km

Edit – I never used more than 1 free ride of Uber so they are taking money from me for all the free rides they were distributing.

Dont use their app ? its not like they are stealing your money.

Use normal cabs,

This isnt state transport,they can levy whatever they want to.

I never face surge problems.

So, dont use them.Simple.

Thanks to intervening of the government….prices will be increased now…

@schumacher wrote:

an uber driver told me that the profits from surge pricing goes to the driver and not the company. is this true

yeah, uber takes 25% of total bill…

Has the surge policy been removed?? Any new updates?

Karnataka, which has made new rules that ban ‘surge pricing’ by cab aggregators is on the horns of a dilemma and seeking support from passengers to deal with the problem.

Earlier this month, the Karnataka state banned the likes of Ola and Uber from raising fares during times when demand for cabs outstrips supply but it believes that the practice of ‘surge pricing’ continues.

The tricky part is that the Karnataka government cannot take action unless passengers complain, which is why transport minister Ramalinga Reddy has asked users to come forward if they have a problem with surge pricing.

“We request the people to come forward and bring such instances to the transport department’s notice by way of complaints and we will take action,” he told ET.

Some users pointed out that prices surged by more than five times on Monday evening. The new rules governing cab aggregators, which included an implicit ban on surge pricing, came into effect on April 2.

Ola and Uber, the dominant players in this space, did not immediately reply to questions from ET. They have also stayed silent on Karnataka’s new rules.

Cab aggregators argue that dynamic pricing is a function of demand and supply. By fixing higher fares when demand exceeds supply, the aggregators say they are able to entice more drivers onto the roads.When enough drivers are on the road, prices fall automatically, they say.

The April 2 Karnataka On-Demand Transportation Technology Aggregators Rules, 2016 rules capped fares for taxis at Rs 19.50 per kilometre (for AC cabs) and Rs 14.50 per kilometre for (non-AC cabs). The rules allow cab aggregators to charge 1.5 times the regular fare only between 11 pm and 5 am.

“We’ll cancel the vehicle permits. We already have the ruling with us,” said Narendra Holkar, the joint commissioner for enforcement in the transport department.

Source: http://tech.economictimes.indiatimes.com/news/m...

App-based taxi hailing firm Uber is running an email campaign explaining that new rules by the Karnataka government curbing surge pricing would increase fares by a third. The Silicon Valley firm says it is engaging with the state government to explain why its business model encourages savings for customers.

“Since January 2016, Uber riders in Bengaluru would have spent Rs 25 crore more (on rides) if the regulator’s pricing model was followed,” said Bhavik Rathod, general manager for South and West at Uber.

Last week, Karnataka had introduced rules governing taxi aggregators such as Ola and Uber, mandating them to register with the local transport authority, set caps on fares and install physical fare meters in taxis. But Uber wants to educate people of the savings they would get by using its system and influence the government to retain the model.

In the light of Karnataka’s move, co-founder of Infosys Nandan Nilekani said India lacked disruption in transportation due to the absence of a national regulator. “For transportation the regulator is the state, and the moment a state is a regulator, each of them will have a different thing,” he said at an event in Bengaluru on Wednesday. The three most disruptive regulators in India are the Reserve Bank of India for banking, the Securities and Exchange Board of India for mutual funds and the Telecom Regulatory Authority of India for telecommunications, all of whom are national regulators, he added.

“Our technology automatically analyses the market for demand and supply and adjusts price. So to ensure that you have a constant supply of vehicles, it’s essential to ensure that you do not have a price cap," Rathod said. "Majority of our rides are cheaper than the government-prescribed prices and surge is just a mechanism to ensure that you have a car every time you want one.”

He said Uber has responded with its feedback on the rules and proposed changes that makes the industry viable for all.

India’s taxi-hailing market is estimated to be between $1 billion and $1.2 billion (Rs 6,600 crore and Rs 7,900 crore) in annualised gross booking value in February 2016, according to RedSeer Management Consulting Pvt Ltd, a research and advisory firm that tracks online businesses in India. Between Uber and Ola, 600,000 drivers ferry 300 passengers each a month on one-way trips, majority of them in large cities such as Bengaluru and Mumbai.

Maharashtra is also planning similar rules to govern taxi aggregators. More states could follow with rules to restrict these aggregators.

For Uber, India is the largest market that is still open for competition. In China, Uber faces intense competition from local rival Didi Kuadi, which is the biggest player, in a global alliance with firms such as Ola and Lyft.

Ola dominates the Indian market with over 65 per cent share, according to RedSeer. But Uber, which launched its India service from Bengaluru, has caught up quickly to own the remaining share.

Source: http://www.business-standard.com/article/compan...

Bengaluru: Taxi hailing service Uber Technologies Inc. on Wednesday said it has submitted its objections to the Karnataka transport department on regulations for the online taxi hailing services, which seeks to prevent Uber, Ola (ANI Technologies Pvt. Ltd) and others from resorting to surge pricing.

“The government of Karnataka has taken a step forward in laying down sector-specific regulations for mobility platforms like Uber. We have submitted our objections to the transport department in connection with the notified regulations and are engaged with the government. The government of Karnataka has shown immense support for businesses that harness technology and innovation and we are hopeful of progressive outcome,” Bhavik Rathod, general manager, south at Uber, said in a statement on Wednesday.

Surge pricing is a practice where rates for vehicles booked on Ola and Uber increase during peak hours. The companies contend that surge pricing helps in increasing the number of drivers on road when demand peaks, with promises of a higher fare.

However, the Karnataka government has been trying to prevent Ola and Uber from resorting to surge pricing. The state government, which issued the Karnataka on-demand transportation technology aggregators rule, 2016, on 2 April, said aggregators cannot charge passengers higher than the fare fixed by the government.

“On behalf of the owner of the vehicle, the driver or the aggregator shall collect hire charges from the passengers as per the fare indication method stated in clause. In any case, the fare including any other changes, if any, shall not be higher than the fare fixed by the government from time to time,” the notification said.

“No passenger shall be charged for dead mileage and the fare shall be charged only from the point of boarding to the point of alighting,” it added.

The fare mandated by the transport department stands at Rs.19.50 per km for air-conditioned cabs and Rs.14.50 for non-air-conditioned variants. To be sure, all cabs on Uber and Ola are air-conditioned, hence the rate applicable is Rs.19.50.

Incidentally, the cap mandated by the state government allows both Ola and Uber to charge multiples of their fare. For instance, UberGo, the cheapest variant of Uber, is priced at Rs.7 per km in Karnataka, which implies that it gives Uber the provision to charge consumers up to 2.7 times the actual fare. Ola’s cheapest variant, Micro, is priced at Rs.6 per km, which essentially allows 3X surge pricing.

According to multiple company executives, surge pricing usually varies between 1.2 and 1.8 times the actual fare.

Senior transport department officials did not respond to calls seeking comment.

Online taxi hailing services had also run into trouble with the Karnataka authorities recently over launch of bike taxis, hailing them illegal as the bikes did not have permits for commercial use. The transport department has so far impounded about 75 bikes affiliated to Uber and 24 bikes registered with other bike taxi aggregators, including Ola, Mint reported on 5 April. Both companies have since stopped providing bike taxi services.

Source: http://www.livemint.com/Politics/dluNMeXc6abmZZ...

According to Uber, the rise in price is not a new concept: Surge pricing is not unique to us – airlines, hotels use the same pricing principles to match demand and supply. It is also sending personalised e-mails to its consumers in Bangalore explaining how dynamic pricing or surge works.

According to Uber, when demand for rides outstrips the supply of cars, surge pricing kicks in, increasing the price. It said there is complete transparency when the surge pricing kicks in as it asks for the consent of the consumer.

“Surge pricing has two effects: people who can wait for a ride often decide to wait until the price falls; and drivers who are nearby go to that neighborhood to offer you an option to get a ride–for a little bit extra. Nearly all surge profits go directly to drivers as part of their fares. As a result, the number of people wanting a ride and the number of available drivers come closer together, bringing wait times back down,” it said.

It is economics of supply and demand which lead to surge in prices, Uber added.

Source: http://www.financialexpress.com/article/industr...

BCC to all dimers who commented here.

Over 30 Uber, Ola cars seized in Bengaluru in ‘surge pricing’ crackdown

Bengaluru: Uber Technologies Inc. and its competitor in India, Ola, have had cars seized this week in Bengaluru for allegedly overcharging customers, a city transport official said.

More than 30 Uber and Ola vehicles have been impounded, said Rame Gowda, the Bengaluru-based commissioner of transport and road safety. He said operations against the two companies are continuing.

San Francisco-based Uber and its Bangalore-based rival Ola square off for an increasing number of customers in India who use the taxi-hailing services. The Karnataka government, of which Bengaluru is the capital, banned “surge pricing” on 6 April, and set a per-kilometer price ceiling for air-conditioned and non air-conditioned cabs, while customers across India complained in petitions and on social media against the higher fares.

“Surge pricing is not in the rules,” Gowda said. “You have to follow the rules of the land, you cannot violate the rules of the land and harass the public.”

Commuters are encouraged to file police complaints against Uber and Ola if they are subject to overcharging, he said.

Personalized emails

Uber this week sent out personalized emails to its base of users in Bengaluru, saying that its pricing ensures reliability and availability for those who agree “to pay a bit more” on occasions such as weekends and holidays.

“It’s a bit of economics 101: supply and demand adjust in response to price changes,” Uber said in the email. Airlines and hotels follow the same practice, it said.

Neither Uber nor Ola responded to emails requesting comment on the seizure of their vehicles.

In February, Nitish Parnami, an Uber customer in New Delhi, started a campaign on online platform Change.org urging Amit Jain, Uber’s head of operations in India, and Travis Kalanick, the chief executive officer, to regulate pricing. The petition has received more than 37,000 signatures.

Uber responded online to the petition saying, “higher prices are required in order to get cars on the road and keep them on the road during the busiest times.”

@parthponkiya8 Thanks for the update and details.

KG to you…