The advantage of Uber has nothing to do with price and everything to do with grotesque incompetence on the part of the taxi operators.<p>Five-six years ago, when I asked for a receipt for an expense report, I got a hand-scribbled note. Running credit cards often required hand-based crank mechanisms. Autoplaying TV on the back of a seat that was billed unless you explicitly opted out. It was, in short, a scammy operation designed to squeeze you in all the impolite ways, and there was <i>nothing</i> you could do about it. When Uber/Lyft came on the scene, it took the scam out of the taxi industry and transformed the situation into one where you had a clear understanding of the price, where you could get a clear and reasonable receipt (emailed, even!), where you could pay with a card. You get a clear idea of how long the operator will take to arrive.<p>I had to use a taxi in St Louis, MO last summer. In order to do this I had to call the taxi company. No app, no website, nothing. It took 45 minutes to show up, period. The driver couldn't find me when he got near. I am very glad I did not miss my flight. It reminded me again of how deeply I support the "ride-sharing" services.<p>I consider the taxicab operations to be corrupt and effectively incompetent, frequently propped up by asinine medallion systems and graft at the city level. Therefore, I refuse to use taxis if Lyft or Uber are available. I will NOT intentionally contribute one red cent to these jokers.<p>Now, all of what the author said about Uber's flouting of the law is true. And that's not something I'm terribly happy about. But I think there's a certain value in simply ignoring bad law and fixing it on the fly. Might be the American in me, but so it goes.<p>In any case: if the taxi industry in Japan is honest, competent and well executed, Uber/Lyft will not have the profound advantage it has over the taxi industry in the US.
The article has a point but didn't get it right. I'm a startup developer and my family runs a taxi business in Japan, and believe me I thought about making Uber for Japan the moment I heard about Uber, but I realized it's not going to work out. Here are my notes I jot down at that time.<p>1) People don't drive<p>In US everyone drives, in fact you need one. But you see none of my friends in Japan own a car. The only people who owns one are people that are well offed. This is because owning a car in Japan is expensive (there is thing called 車検), a hassle (no parking), and getting a driver's license is long and hard. Supply is low.<p>2) Cash<p>In Japan most people still carry cash. Their preferred method of payments (in order) are: cash, Suica (debit card for train), and then credit card tied with NFC in phone that charges your phone bill. So Taxis are more convenient than Uber.<p>3) Part-time jobs are everywhere<p>You see it's very easy to get a part-time jobs. In fact most college students are doing it all the time. In US Uber looks attractive "I can drive and make money!", but in Japan it is "I just have to go to that place that dispatch part-time jobs and will make money".<p>4) Zoning<p>This is a bit similar to what the article talks about but in a different perspective. Don't forget that Japan fits in California. Each city have its own law and you need to pay a lot for each zone. My family operates in one district and have 2 competitors. Other district have its own. Each city have its own market and demand. You can't even pilot in a small region because if you drive 15 minutes you are already in another district, which you are not allowed to pickup. These zoning are strict, and japanese people know about it. It existed from the day yakuza used it as protection fees.<p>5) Anybody can be a taxi driver<p>You see its not hard to be a taxi driver if you really want to be one. These are called 個人タクシー and can operate on your own.
"In fact, there is a school of thought in the West that when the fines are cheaper than the cost of compliance, it is not only OK to break that law, but that the CEO has a fiduciary duty to break the law."<p>This claim seems absurd. Fiduciary duty is a legal concept, and for obvious reasons, there can never be a legal obligation to break the law. Americans might think it's ethically OK for corporations to break some laws. But a claim that a CEO had violated legal duties to shareholders by not breaking the law would get instantly laughed out of court.
The article basically states that Uber's cavalier attitude towards the law was the wrong approach to use in Japan, because the Japanese public does not respect this attitude, and that they should have worked it out with regulators before they started operations.<p>I guess the broader lesson implied is that you need to put in the effort to understand the local culture, and adapt your strategies accordingly, before you try to enter a new country.
Better title would be "How Uber's Failure in Japan Can Help Multinational Corporate Expansions Everywhere". It's a bit of a stretch to still call Uber a startup, and even if you grant that, these lessons are not for startups.<p>I happen to have co-founded a multi-national startup. The best advice I have for going multi-national as a startup is don't.
> If you’ve attended a movie in Japan ... you understand that many laws can be broken as long as everyone breaks them together.<p>What is this referring to?
This whole argument doesn't work when you consider AirBNB. AirBNB is thriving in Japan with the same Uber playbook.<p>The real reason for Uber's failure is public transit and taxis in Japan are amazing (and for a decent price).
Sounds like Uber's failure in Japan is related to a reasonably honest and effective government.<p>The biggest failure of Uber that I'm familiar with of is ex-NYC New York, and that's essentially because the Feds are tapping every politician's phone at the moment[1], and it's difficult for their lobbyists to do whatever they do to "influence" outcomes.<p>[1][<a href="http://nypost.com/2015/05/04/state-majority-leader-dean-skelos-and-son-charged-with-corruption/" rel="nofollow">http://nypost.com/2015/05/04/state-majority-leader-dean-skel...</a>]
You know what, it's not going super well here in Sweden either. Can't say I'm sorry about that. There are some things I'd rather not "disrupt", one of these things is basic workers rights. I'd like to see Uber as masters of gamification. They've successfully gamified fast money, and screwing yourself (but perhaps mostly others) over in the long haul.
Uber and other type apps are successful disrupting traditional taxi services where a heafty price tag is on medallions.<p>Where countries like Japan who do not have a medallion system really, there is not much to drive prices up for taxi fares for Uber and like to undercut to be successful.<p>A good taxi and transit system isnt everything... I live near YVR, we have taxis lined up at YVR for convenience.
You are also paying way more cause first, the taxi medallions are so expensive... Then there additional fees for being licensed to do pickups at YVR in the designated area.<p>Everyone I know who commutes via taxi or transit wishes Uber types were here (banned).<p>Especially when u fly to DFW and the only options for a taxi is a broken minivan 20 mins later.<p>And then Uber being less than half and a lot quicker.<p>Convenience and cost. If Japan has those covered, then no reason for a Uber type to be operating there
About 5 years ago we had a new taxi firm open in my home town, the boss(es) invested heavily in technology, you could book via a text, app or call.<p>They had a ruthless focus on clean cars, uniformed drivers (I was talking to one of the drivers, if they where not clean and presentable he wouldn't put them in service), they'd even jump out and help you load your shopping etc.<p>You got a text with the drivers number and plate number and could even set it up so someone else got the same details (handy for parents, partners etc).<p>He absolutely decimated the local badly run taxi firms, the good drivers moved to him and the other firms had to run to catch up or die out.<p>It was fascinating to watch as an outsider the change across the whole city once word got out.
In Japan, taxi services fall into broadly 2 categories,
- large to mid size fleets 2000+ and - private 'kojin' taxis<p>There is yet another category commonly referred to 'izakaya' taxi, these are also private taxis who work together as a network to compete with the big players.<p>Things to know
* all taxis are clean
* some are spotless ie washed every morning
* 75%+ are equipped with wireless radio
* 90% of cars in general in japan have gps, so it should not come as a huge suprise to see taxis who have 2 units.
* Most of the big fleets accept every credit card under the sun including certain cards from some processors not too popular elsewhere (JCB).
Some accept nfc 'type' payments from several different incompatible processors.
* In the good old days 90s - you could call a cab company and they would radio (motorola) a taxi to your location. Now the big companies have apps developed by 3rd party vendors which support points for free rides etc.<p>People in Tokyo prefer the subway because its quicker in most cases- So you are left with
* people use cabs to get from pt a to pt b by making an on the spur of the moment decision. i see a cab i jump in. Uber would have a problem unless the fleet was huge from the get go.<p>* other people who 'plan' and use a cab can easily call one of the established players. Addresses are fairly resonably defined in tokyo and gps kits are excellect after having being engineered for 10+ years. Uber would have a problem because their software is not adding any value to what incubments are offering<p>* then there is this segment of people who use taxis for everything- thats where the izakaya taxis come in. They provide a first class experience using luxury grade cars (think lexus++) that are able to handle the longer distance rides, they might offer you a beer, tea etc. This is a premium service, you call the cab and he has you registered if youve used hiw before so he knows you by name. If hes busy enroute with another customer, he will just route you to his buddy. They mostly have 2 smart phones to help with this and they do this while driving with off the shelf apps well configured.<p>All factored in Uber's traditional model is challenged. But Uber hopefully has deep pockets, they should start by buying a small fleet and focus on certain/towns.
Good article, but I think the author understates a bit how hard it is for ANY foreign tech company to do well in Japan. You can almost always take your American business, apply it as-is (with some decent translation/localization) to major European markets, Australia, Canada, New Zealand, even South America, and so pretty well in most cases. Try the same in Japan, though, and you'll generally fail.<p>It's a wildly different culture in so many different ways, and there are tonnes of local competitors who are likely in your niche, but specifically targeting Japan, with an intimate knowledge of Japanese culture. The few foreign tech companies that have done well in Japan basically have a separate business and product just for Japan, like Yahoo Japan.<p>If you're thinking about investing significantly into entering Japan as an American tech company, you probably shouldn't, unless you're willing to invest HUGE resources into it (and even then, it's a massive gamble).
I think in many countries companies like Uber and AirBnB are seen to be a challenge to the democratic will of the people. It should be no surprise that we don't care very much for this!<p>I wonder if Uber could have achieved success in markets with more trusted governments (Germany, Japan) if they started with a softer approach.
I think Uber's failure in Japan means the failures in Tokyo downtown and other large cities like Osaka. In those cities you don't have to wait much to pick the cars up. It's not the same like in SF. Discovering a niche market for Uber in Japanese large cities might be difficult.
Personal anecdote, we flew into Narita and the customs line caused us to miss the bus that would have connected us to Haneda for our next flight. We were certain we would miss the flight, but instead we got one of the best taxi drivers I've ever met.<p>From what I gathered, in Japan you basically pay a set fine for travelling over a certain speed. So he added that into the fare (vaguely recall it was 15% or so).<p>Long story short, after some very impressive driving we got there in time. I gained a massive appreciation for Japanese taxi drivers that day.
If you're interested in this topic, I'd recommend this great explanation of why Uber lost to Didi in China: <a href="https://www.quora.com/How-did-Didi-beat-Uber-in-China/answer/Wang-Di-8?srid=p6yy" rel="nofollow">https://www.quora.com/How-did-Didi-beat-Uber-in-China/answer...</a><p>There are ultimately many reasons why US startups fail in some Asian markets (including China and Japan), and it can't be reduced to cultural differences or protective regulations.
Taxis are about 20% (rough estimate) cheaper than Uber in Japan. That, plus the already mentioned abundance and good quality of service of taxis in Japan (as well as the ease of booking one through phone/internet/mobile apps), leaves no real reason for most people to use Uber in my opinion.
Japanese are different from rest of the world :) <a href="https://en.wikipedia.org/wiki/Utility_frequency" rel="nofollow">https://en.wikipedia.org/wiki/Utility_frequency</a>
Uber is just a management that controls bunch of small entities providing a service. You can hate it or feel envy, but actually there are millions of companies with bad and foolish management that cannot even do their service at all.<p>I hope someday I'll see the company that will act as an umbrella to all service companies out there, and will filter out all those pretending fools unable to clean my carpet, install new furniture or repair pc. I'm really tired of this local 'legal market'. I need it done, not legal.
Uber may be fighting against the law, but when the government does not respect the democratic will of the people, it is actually ok and in the long run will benefit all.<p>I'm based in Helsinki, Finland and Shanghai, China (50/50). Two very different countries in all aspects. In both countries government used to regulate taxis and today China does not anymore but Finland still does.<p>In Finland taxis are very new (BMW, Mercedes Benz, Audi, Tesla etc.) and expensive (supported with tax payers money) and they are REALLY expensive to take. Way too expensive. This may sound ridiculous, but in my home town (major Finnish city) during the weekends it was common for people to walk home 7-10km after the night out, because taxis are so expensive. They are not seen as normal transportation service but instead more as a luxury service that you have to carefully consider before taking. They are still very safe, clean, have their own Uber-like app etc. Finns have demanded many many years (long before Uber) for the taxi-monopoly to be destroyed, but the government has happily turned a blind eye to them. Ubers in Finland are usually Toyotas or Volkswagens, quite new and clean. Prices are only 50-60% of traditional taxis.<p>So what about China? Taxis are old/medium-level volkswagens, little dirty, driver may be smoking inside the car, quite safe but there are many people playing with the meter or overcharging in some other ways. Some drivers are also really greedy and arrogant: They may ask you where are you going before letting you into the car and if they don't like the route they'll not take you. Anyway they are relatively affordable for average people in China. When Uber and it's Chinese competitor DiDi came to the market, the government was confused at first but later legalized them when they realized that competition will benefit all in the long run.
Now? Uber and Didi are extremely popular, significantly cheaper than traditional taxis, clean, safe and no more people have to worry about getting bullshitted with the cab fare.<p>So once again Uber made things better for all. Sometimes breaking the law in not only acceptable, but required for a greater good and change to happen. In Finland however it might take a while since the government is still living in their 1950s mentality and currently hunting down Uber drivers and suing them.<p>Some might say it's wrong that Uber is putting all the responsibility on the driver. You know what? It's not.
They know what they are signing up for and besides if Uber as a company was responsible for every single incident all over the world in every country, the company wouldn't exist anymore. No investor money could cover all those fines. The current way is the only way Uber can exist and only way the change can happen.