Uber Faces Numerous Challenges To Its African Domination
Last month, global taxi-hailing company Uber celebrated the fourth anniversary of its launch in Africa. Since initially pitching up in Johannesburg in September 2013, the app has amassed more than 1.8 million active users across a number of countries on the continent.
Uber says it is proud of what it has achieved in Africa in such a short space of time, and says its driver-partner model has helped create jobs in a stagnant economy.
“Uber’s business partnership approach provides an accessible means for entrepreneurs to not only supplement their own income but also to become small business owners, thereby helping to improve the lives and futures of individuals, families and communities,” the company said.
“Sub-Saharan Africa has certainly benefitted from Uber’s arrival. Citizens have a new, reliable way to get around, entrepreneurs have found a new way to earn an income and cities have also benefitted – with possibly less cars on the road and therefore less carbon emissions.”
That is one view, but there are many that disagree. Taxi drivers count among them, and violence against Uber drivers is mounting, most notably in Johannesburg. This reached public attention this month as a friend of local rapper Jack Parow was stabbed in the face, allegedly by a taxi driver, for hailing an Uber.
Uber is clear that this must not be allowed to go on.
“This is a distressing situation that needs thorough investigation. Our incident response team is reaching out to all parties and will provide whatever support is necessary. We will support the police in their investigation in any way that we can‚” Uber spokesperson Samantha Allenberg said.
“It is just unthinkable that someone used such violence to limit consumer choice. This is unacceptable and police and government need to take a stronger stand against these illegal actions.”
Uber hegemony over
The problems for the company go deeper than this, however. It was not so long ago that Uber was riding the crest of a wave in Africa. It seemed to have established hegemony on the continent, seeing off initial competition from the likes of Snappcab and Zapacab in South Africa, as well as well-funded pan-African competitor Easy Taxi. All was well.
Yet Uber seems to have failed in its own bid to, by way of defeating the competition, limit consumer choice, just in the same way as taxi drivers will fail to do so via violence. If anything, the playing field is getting more congested, and its new rivals have more backing than the local clones it had to deal with when it first arrived on African shores.
Its primary competitor is Taxify. The Estonia-headquartered company, which offers both taxi- and private car-hailing services to over 2.5 million users across 18 countries, is making headway in Africa, with launches in the key Uber markets of Nigeria, Kenya and South Africa. And it seems keen to beat Uber at its own game.
It is already imitating UberBLACK by launching top-end service Taxify Comfort, has expanded into more peripheral cities within its markets, and beat Uber to launching M-Pesa payments in Kenya.
Vitally, it is not going away, having in August secured an undisclosed funding round from Chinese mobile transport platform Didi Chuxing to expand its operations in Europe and Africa.
Another well-backed challenger is Little, launched across Kenya earlier this year by Safaricom and Craft Silicon. Little is also innovating, joining Taxify in accepting M-Pesa payments and launching its own Little Wallet. It is launching in West Africa imminently.
Uber is alive to these fresh challenges, and is not resting on its laurels. It rolled out its UberSELECT option to challenge Taxify Comfort, rolled out UberEATS in South Africa, and has a new service that allows users to request an Uber for someone else. The company has plenty up its sleeve.
Yet, as more serious competition begins to fight the company on more fronts, and issues with meter taxi drivers continue to escalate, the company enters its fifth year in Africa with slightly more on its plate than in 2013, and perhaps more than it bargained for.
Tom Jackson is the co-founder of tech news and research platform Disrupt Africa and a journalist covering innovation on the continent from the Cape to Cairo.
Sign up for the Moguldom newsletter — business news you need to know about economic empowerment for the digital age, delivered to your inbox.