The talks about Ola and Uber India merger are everywhere it seems that the deal can be finalised soon. In order to expand its market Uber is experiencing huge losses and to compensate for that, Uber has made such deals with rivals in different countries. While this can be good for the investors but the merger between these 2 leaders of can market in India could be a bad news for the users.
Ola may try to create a monopoly
The main issue that people has to face is that Ola will spend heavy money to create a monopoly. As it happens in every market, after making monopoly Ola will make changes according to its needs.
If we believe reports, Softbank which has invested its money in both these companies is encouraging this deal. Neither Uber nor Softbank has officially announced anything about this merger but Ola has given a hint when a spokesperson from Ola said “the company “is always actively looking for opportunities for expansion of its footprint,” and has the back up from investors including SoftBank.
Also Read: Ola In Talks With Uber India To Acquire Its Business
Whether it happens or not, we are just looking at the possibilities that can happen after the deal. A similar merger happened in 2015 when Ola acquired TaxiForSure and since then, Indian cab market has been led by 2 big names.
Effect on Drivers
Not only for the consumers, this is bad even for the drivers as currently, they have the choice of switching if Uber doesn’t pay them well. Also, they can do the same if Ola decided to decrease their pays. This implies for customers too, but after the merging, the user has to face the negatives. This happened in China after the Uber-Didi deal, the cost of rides have been doubled and the pay of drivers has reduced.
Lack of other compititors
No other name comes to the mind of cab users after Ola and Uber. Local companies are not able to provide quality and technology that these two companies have. Also, Ola will make it difficult for new names to enter this market. Competition gives a lot of benefits to the users and companies try to operate with new innovations and reduced prices but if this deal happens we can imagine the consequences that Indian cab market will have to face.
