Can Uber make it in India?

From Farhad Manjoo at the New York Times:

India’s cellular networks can be spotty and slow, and banking, credit cards and other financial mainstays cannot be taken for granted. More than that, vast differences in education and wealth create a social dynamic between riders and drivers that cannot be smoothed over by improving an app interface.

Not only are many of Uber’s drivers here unfamiliar with smartphones, some are illiterate. Often, drivers and riders don’t speak the same language. Many drivers need financial help to purchase or lease cars, and then require continuing help to manage their finances and other details of their small businesses.

On top of all this is competition. Uber faces an aggressive and well-funded Indian rival, Ola Cabs, which operates in 100 cities and offers a wider range of services than Uber does.

…The companies must also spend time educating drivers on the social dynamics of working for themselves. Many drivers arrive after working as private drivers for middle- and upper-class Indians; those jobs can be grueling — drivers work long hours, are expected to be constantly on call, and often aren’t accorded much respect for their work. When they come to Uber and Ola, the same drivers have to adjust to a job in which they finally have some agency, and the change can be terrifying.

Those are all good points, but I don’t think they get at the two main reasons why Uber will continue to have a hard time making money in India.  First, in major cities you never will know when your ride actually is coming.  The vehicle could be around the bloc, but still take thirty minutes to arrive.  In the meantime, should you just wait?  Second, if it is immediacy you value, there is almost always an auto-rickshaw nearby.

By the way, it turns out that about 80 percent of Uber transactions in India are cash-based.


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