Many local
governments in China have banned taxi booking apps or some of their features,
however the apps continue to see a boom in the Chinese market, being widely
adopted by drivers and users in bigger cities for a number of reasons,
according the Chinese-language business news portal TMT Post.
The report
cited strong user demand for taxi apps that has boosted the market as more and
more people are willing to spend money to reserve a future taxi ride and avoid
wasting time hailing a cab on the streets. The taxi booking apps are also
user-friendly and similar in design to the widely used WeChat, a mobile text
and voice messaging communication service.
The market
has become increasingly attractive for drivers and passengers as domestic taxi
booking app developers frequently launch special offers for them, the report
said. For instance, popular taxi-hailing app Didi Dache offers a discount for
passengers wanting to book taxis through their system, while providing
subsidies of up to 100 yuan (US$16.40) to encourage cabbies to use their app
for accepting service requests.
Meanwhile,
considerable capital has been injected into the market, which has facilitated
its development. On Nov. 26, 2013, e-commerce giant Alibaba acquired
Shanghai-based taxi booking app Dahuangfeng, which was later merged with its
main competitor Kuaide. Alibaba has invested US$100 million for the development
of the merged taxi booking app company. The Didi Dache app, backed by Chinese
web titan Tencent, also received US$100 million in investments earlier this
month.
Given the
latest developments, the battle for the country's taxi apps will be between two
of its biggest web companies — Alibaba and Tencent. Their operations cover
various areas of the internet industry, with the two companies aiming to expand
their online, offline payment business into catering and restaurants,
accommodation and other sectors.
Taxi
hailing apps have become popular in large cities as they make it easier to hail
a cab during the rush hour, and more and more app developers have joined the
market, according to local media reports. Thirty such apps are now available in
China, with the number still climbing and the competition growing more intense.
China's
taxi app market remains very chaotic however, with many developers using
dubious methods to conduct promotions, an industry expert said. He added that
it was normal for firms to adopt eye-catching practices given that the current
top priority for all players in the sector is to win as much market share as
possible.
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