Creative Destruction in Bangalore's Auto/Taxi Sector

I don't think anyone in India needs any introduction to the social menace called autorickshaws, especially so in Bangalore. They and their drivers are Bangalore's universally most despised creatures, the hate spreading across class, income and social status, bridging even the great IT/non-IT divide. Much of the complaints against them are on what they charge (if they agree to on hire in the first place), ranging from "20 rubees over the meter", "oneandeyaaf" (1.5), "double meter" to "2 kilometers? 300!" Then there are things like their attitude of being completely above any law whatsoever, irritating noise from 2 stroke engines or doctored silencers to make them feel "macho" and polluting the city through their acidic, toxic fumes from leftover fried-chips-vegetable oil they use as fuel. Add to this general goondagiri of shouting, abusing and even assaulting passengers if they resist their robbery. They move in packs and if they see any of their compatriots in the smallest of signs of trouble, woe be unto anyone who might be 'causing' said 'trouble'. Every single person reading this will have had atleast a double figures of nasty run-ins with them.

Bangalore Autorickshaw Meter

For decades they have preyed on the general public's laziness, 'convenience', absence of public transport or any 'other' options and of course, unfamiliarity. All attempts of Police and Government authorities to bring them in line have all but failed. There might be really honest, hardworking auto drivers out there but they are as much present as a Jew in Palestine, except in Mumbai maybe, where they usually fall in line thanks to numerous other options available for public to travel: taxis, buses, metro, mono and suburban trains. That is the cue to where I am getting at: choice. Compared to Mumbai, Bangalore's public transport options are severely limited. BMTC's bus services, though extensive in routes and numbers are notoriously unreliable and inefficient. There is no suburban (local) train network and the Metro is a joke (for now). Add to this the illusion that taxis costed a lot, despite autos charging way more than the taxi fare (Rs.20/km). Due to all this, auto guys were free to extract their kilogram of flesh (I am vehemently anti imperial system) from hapless passengers. Rs.50/km was the norm! However, not for long! The IT Gods have struck! Get ready to say your prayers, autowallahs! The days of your lawless rampages are about to come to an end!

The Story of Taxi Companies in Bangalore

Since the beginning of time (which would loosely translate as 1995), Bangaloreans had been praying to the IT Gods for deliverance from the curse of the autorickshaw. The governments as always was least interested in regulating them as auto drivers, numbering around a Lakh in the city are a powerful, organized, tough, brazen and usually "local" force in organized numbers with lots of anti-social elements in them whom the politicians could put to good use. However, there now is hope on the polluted Bengaluru horizon. And it came from the least expected source: no, it is not the Metro,the Railways or not even the Tata Nano. It is from a bunch of startup guys who have somehow managed to make the two ends of the spectrum, the shiny IT-enabled services space and the chaotic on-the-ground reality meet! Despite all the million "software" cabs running around, Bangalore has no "real" taxis you can hire off the street ala Mumbai/New York. Neither do we have taxi stands and hence taxis you can hire from there. Hire-able taxis popularly known as "Call taxis" running fleets of Maruti Omnis were present in Bangalore for the past ten years or so. However, it was the new Bengaluru International Airport strategically located halfway between Chennai and Hyderabad that kicked off the ascendance of the star for cab services in Bangalore.

Bangalore Airport Arrivals

It all started with Meru and Easy Cabs along with KSTDC's taxi services to the airport. Soon people started hiring these cabs for non-airport journeys, demand for which kept increasing until some wise guy realized the potential lying here. Suddenly, the unglamorous taxi service space was being eyed by the startup kids of Bangalore who fused centralized booking, scheduling, payment and tracking through call centers, apps, websites and GPS with cab services, capturing attention of more and more customers. After their initial success and receiving generous funding from Venture Capitalists, what happened in the telecom, airline and e-commerce sectors happened: fare wars! Today, Taxi For Sure is offering rock bottom rates of Rs.49 for 4 km, 63 for 5 km and 133 for 10 kilometers in Bangalore while Ola is offering a 6 km ride for just 100 bucks! Uber has a flat fare or Rs.15 per kilometer as of now, which is expected to fall. The USP of these services? You no longer need to book your cab hours or days in advance. It is all 'instant' now! You can look up where their nearest free cab is available from your pickup point and how long it will take to reach you through their app installed on your smart phone! All you need to do is a booking and it will show up in a couple of minutes. And you can pre-load cash in their "wallets", where you can just walk off after you reach your destination and your fare will be deducted from your balance! All this tech effectively offers an alternative to autos, biting into the pie where it hurts them the most! These charges are less than that of driving your car, BMTC Volvos or of course, auto rickshaws! Cabs are kicking auto ass!

"Traditional" Auto Drivers and Creative Destruction

As expected, auto drivers and taxi unions are up in arms against these new-gen kids and their newfangled ideas as it presents an obstacle for them in their robbery business. How dare anyone question the God-given right vested with them to rob, loot, bully and beat up citizens as and how they wished?! They approached the Transport Commissioner of Bangalore threatening to go on strike if the government did not interfere to stop cab companies from offering low fares because it was "ruining their business" and they were "illegally" lowering fares! Oh the hypocrisy!! These people can wantonly overcharge, breaking all rules and when someone undercuts their business it is a problem? Class entitled goondaism we see everywhere in this country! Thankfully they were promptly shown the door by the commissioner who sensibly replied that he "cannot dictate terms to taxi operators as long as the public are benefitting" and there was nothing his department could do as long as these cab companies did not charge above the stipulated maximum charge of Rs.19.50 per km. If this continues, hopefully these companies will take away a lot of business from dastardly auto thugs, forcing them to fall in line. I have made it a point to call a cab from now on whenever a situation presents where I could've taken an auto, even though I go out of my way to avoid any of my whatever little hard-earned money I have from falling into their clutches. I know many auto drivers will go jobless but I have absolutely no sympathy for them. I too work hard to earn money.

Too Many Autorickshaws in Bangalore

This is the second time in a month that we have seen "traditional" players fuming and running to the government crying: "Mommy, these new-age IT kids are not allowing me to bully and grab other kids' toys! Please make them stop!" The first was after the great Flipkart fiasco when "traditional" brick and mortar businesses rallied against online retailers for "undercutting" them. This is the second. And there will be more to come, because India is undergoing a huge transformation in how people think, act, understand, shop, live and love. What is happening here is "Creative Destruction" or destruction of the old and "traditional" replaced by creation of the new and "modern" in business and in life, an oxymoronic term coined by the Austrian-American economist Joseph Schumpeter, 1942. In Malayalam: "ഒന്ന് ചീഞ്ഞാലേ മറ്റൊന്നിനു വളമാകൂ".

Economic growth and technological change are accompanied by what the great economist Joseph Schumpeter called creative destruction. They replace the old with the new. New sectors attract resources from old ones. New firms take business away from established ones. New technologies make existing skills and machines obsolete. The process of economic growth and the inclusive institutions upon which it is based create winners as well as losers in the political arena and in the economic marketplace. Fear of creative destruction is often at the root of the opposition to inclusive economic and political institutions.

- Daron Acemogalu, "Why Nations Fail" p.84

Examples of Creative Destruction: US Railroads, Telegraph, Audio and Video Cassettes, Kodak Film Cameras. I would like to see Creative Destruction as an all-encompassing term that extends beyond business and economics and into social life and culture as well. A good example is the #KissOfLove protest that was started by youth groups in Kerala against moral policing and high-handedness of so-called "preservers of culture" who believe public displays of affection are #AgainstIndianCulture. Whatever its pros and cons might be, such a protest would've been unimaginable even just five or six years ago. Anyway, auto and taxi drivers are scared that their ways of intimidation will not last and they will be rendered obsolete by the tools spawned by technology, which I absolutely, totally wish would happen. There is a name for these "backwardies" who oppose anything creative and modern fearing their destruction today: Neo-Luddites, named after the Luddites, textile workers of 19th century England who outraged, sometimes violently against the mechanical loom and the onset of the industrial revolution for three years starting in 1811. Imagine, what if the Luddites had won? If steam-ship companies had sabotaged the rise of the airplane? If horse rearers had successfully lobbied against automobile companies? Or nearer to our period, what if paper book/periodical publishers had blocked the rise of online publishing, all of these fearing loss to their businesses? Thankfully those happened in progressive countries with laws and public mindset to protect innovation, else we would still be saddling up our horses to go to work everyday.

Bas-relief Of Carved Riders On Horse-back At Keshava Temple, Somnathpur, India

A Luddite Dream of Rush Hour in Bangalore

Autorickshaws are remnants of an old India, which haven't changed much (except for the fares) in the past 30 years save some cosmetic tinkering. They create nothing but havoc on our roads and are effectively symbols of anarchy and lawlessness. What safety mandates (EURO NCAP? LOL) or pollution standards (Bharat III?) do they meet? These three-wheeled monstrosities have to disappear from Indian cities, if not outright, atleast step-by-step if they have to become a part of the civilized world. And then there are some people, mostly foreigners and Indians living abroad who "romanticize" autorickshaws, presenting them as some kind of a pop-culture icon, as the embodiment of all that is India and "different" about India ("Oh, they are so cute!") and as representatives of the great Indian "order in chaos" celebration nonsense. Of course, they can romanticize on their sparkling First World roads where they do not have these things spewing out acrid fumes and taking sudden U-turns into oncoming traffic and stopping in the middle of a narrow road and walking off to buy beedis and hanging out in groups leching at women. It is easy to get romantic about the rain sitting in your well built house while the guy living on the street would not share your "romantic" views. Anyway, auto-less roads are a distant dream but hopefully this new "lost-cost instant cab" revolution will force them to fall in line and make life easy for people of the city who are already being harassed as money making cows by everyone from the government to builders to drivers.

  • Sathyan AK

    Hi,

    This is a very good post and I too was thinking the same from the past few days. A lot of people are switching to cabs nowadays and the fare wars have really made it better for the common man. The centuries old problem of these auto thugs were not solved by the authorities/police and now these smart private enterprises have shown us the way. I hope the govt wont interfere and stop the growth of such business just to fall in line with the thugs. (Already we heard some noises some days ago)

    I once booked a cab at morning 4 AM (extremely odd hour) and he dropped me at the door step and the meter was 167!!… Three years ago an auto thug charged me 350 for the same distance at 7 pm and worst is to face the attitude of these goons.

    I wish success to these new entrants and the thugs have 2 options, either join these networks ( I am sure hard-working and honest guys can make use of it the best possible way) or find another job. Like you said I have no sympathy for their pack.

    Thanks for another enjoyable post.

    • Thank you! I had an experience too, where a 10 km ride in the middle of the night cost me only Rs.184! I take the cab with money loaded in their wallet whenever I can’t drive or take the bus/train. Auto guys can go fork themselves. Like I always say, technology is the only force that will save us! Again, thank you for the comment! :)

  • Pingback: IT is Getting Old, as are the “IT Guys” Part 3 | Vadakkus!Vadakkus!()

  • Pingback: IT is Getting Old, as are the “IT Guys” – The State of the Indian Software Industry | Vadakkus!()

%d bloggers like this: