Ola and the market economy - it works!

I am an unabashed fan of the Ola revolution. As you know I am in Chennai, India, right now. If you are not from somewhere in India you probably don’t know what I mean. Well Ola is our local answer to Uber. If Uber is the forerunner then Ola is the copycat which has risked intellectual property infringement to rake it in. During the recent Chennai floods, Ola put its app to good use to advance its brand while also sponsoring rescue boats. Needless to say it is now ubiquitous and the first word out of the mouth of babes and dames on the move.

I am not an unabashed capitalist and yet I believe here is one instance where market forces have trumped all regulatory efforts. If you have even taken a ride in an auto in India over the past decade you will know what I mean. Let me back up a little more. When our parents grew older they gave up driving and then hired cars for when they needed them. These cars came with drivers and you had to pay a set amount for a minimum number of hours. So the tourist car was a worthy option if there were many stops but not to and from destinations. This was often hit or miss. I have had drivers who were drunk or who even snuck out to get sauced while waiting around for us! We were at their mercy. Taxis were a rare sight and did permanent damage to the back as they rode over potholes with no shock absorbers. So the other options were public buses or autos.

If we did not drive our parents’ cars we had to rely on these alternatives. Luckily for me, I have a generous sister whose car and driver were available to me most times so I am spoiled and it is on the odd occasion that I am left without options. With the overcrowding in ramshackle buses we had to reluctantly settle for the auto. Now what was so terrible about hitching a ride in an auto? For one, it was not the most comfortable given its centre of gravity is low and there is a risk of it turtling with the slightest provocation. But worse, auto drivers would never put on the meter and haggling with them resulted in immense tension and strain. You had to negotiate with at least 3 before one would agree on price. In addition, you could wait several minutes before one would agree to take you to your preferred destination. They wanted to take you to where they would rather be going!

On one visit back home I was told the government had introduced legislation that required autos to put on the meter. However, to my utmost chagrin I found that the meters were rigged so the fares escalated without rhyme or reason, or drivers simply flouted the rule giving me no option but to pay their asking price.

So what has changed with Ola? Well it is an App and I can get a mini cab, a share cab, an auto among others. Given drivers bid on rides and are required to cover a minimum number of rides per day, I get an instantaneous response to my request. I can track their progress and pay cash at the end of the ride. They actually put on the meter. You are asked not to tip. And ..drumroll …here is the reason why it works! You actually rate your ride at the end and submit it. And this rating shows up when a driver responds to your call. They have an incentive to maintain their autos (which are mostly new for now), to put on the meter, their best behaviour and not ask for a tip. I almost fainted today, when I got back exact change from the driver- I cannot remember when that ever happened! The cab and auto drivers like this system too since it takes out the guesswork for them, organises their day and guarantees them returns if their reflexes are quick and they put in their hours. It is all so civilised. Now I find reasons to go out just to ride the Ola.. Who would have thought?!