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War between Ola, Uber is taking nationalist overtones
Ola's grouse is this: Despite having no permit, Uber is still plying its vehicles. Ola said it is an attempt to "bypass the laws of the land by foreign companies."Bloomberg | June 30, 2016, 13:14 IST
By Saritha Rai
The bitter fight for market share between Indian ride-hailing startup Ola and San Francisco-based Uber Technologies Inc. is taking on nationalist overtones in a battle unfolding in an Indian court.
Ola's parent ANI Technologies Ltd told a court in Bangalore this week that it is an indigenous startup whose success can be attributed not just to its business model but also the fact that it is a "law abiding company," with utmost concern for the safety of users, who are citizens of the country.
Ola's latest salvo is part of Chief Executive Officer Bhavish Aggarwal's strategy to fend off competition from billionaire Travis Kalanick's Uber, which said last year that it would spend $1 billion in India to expand its business. The two rivals are locked in a fight for domination of a market estimated at $10 billion, where cut-throat discounts entice more Indians to efficient, cleaner rides in a public transport-deficient country.
"Ola is eager to show that it has complied with all the rules while Uber has not," said Anupam Manur, a policy analyst with Takshashila Institution, a think-tank based in Bangalore. "It is trying to get into the good books of regulators while highlighting the fact that it is local and Uber is foreign."
Ola's statement was filed in the Karnataka High Court, where a group of drivers working for cab aggregators filed a petition last month, opposing rules used to impound cars and impose penalties. The drivers made both Ola and Uber parties in their case.
Ola is eager to show that it has complied with all the rules while Uber has not. It is trying to get into the good books of regulators while highlighting the fact that it is local and Uber is foreign.
The new rules, enforced in April, mandate that online taxi aggregators in the state of Karnataka, of which Bangalore is the capital, comply with conditions such as installation of panic buttons, digital printers, cab signage as well as complaint registers in the vehicles. Uber, which called these rules redundant and "regressive," filed a petition seeking a review and also sought lifting of a ban on surge pricing.
While Ola gained an edge over the world's largest startup last week after being granted a license to operate its vehicle aggregation service, Uber said its application was still languishing and officials had asked it to make a fresh application with another local authority.
Now, Ola's grouse is this: Despite having no permit, Uber is still plying its vehicles. Ola said it is an attempt to "bypass the laws of the land by foreign companies which run their operations in this country for profit without due regard for applicable laws."
'Foreign' Funding
Responding to Ola's court statement, Bhavik Rathod, Uber's general manager of South and West in India, said in a blogpost that Uber had the deepest respect for Indian laws.
"What makes Uber 'foreign'? The fact that we are established in San Francisco but have a hyperlocal team solving problems that are locally relevant? Or that, just like our competitors, we received most of our funding from 'foreign' investors?" Rathod asked in a blog titled " Let's keep Bangalore moving."
Ola declined to comment, as did Uber, which referred queries to Rathod's blogpost.
Bangalore, India's technology hub and a city of 10 million residents, is one of India's top three markets for both companies. Uber operates in 27 cities in the country while its foremost rival is in 102 cities.
Ola, valued at about $5 billion, counts SoftBank Group Corp., Tiger Global Management LLC, GIC Pte. and Accel Partners LP among its investors. Saudi Arabia's sovereign wealth fund was the latest to invest in Uber, valued at around $62.5 billion.
Kalanick recently met Prime Minister Narendra Modi, a move seen as strategic, while Ola too invited the prime minister to launch its electric three-wheeler service.
Tags : Aftermarket, Uber, Travis Kalanick, Ola, Narendra Modi, Legal Issues, Funding
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