Isnt the Competition Commission of India responsible for curbing monopolies and predatory pricing? Predatory pricing may be good for the customer initially but after the competition is killed the customer will be left with no other options and will have to accept whatever is offered to him , be it cost or quality. This I speak as an Ola Cab user. Do you know they dont take any attachment or service charges from the cab drivers whereas their competition charges anywhere between 2000 to 5000 Rs. This money is for marketing ,call centre charges and is their main source of revenue. Ola is doing it to make drivers switch over to their side. From the customers they collect 100 Rs for the first 5 KM and 12 Rs per km after that. And they pay the driver 150 for the first 6 km and 16 Rs per km after that. Not only that they pay the drivers 5000 Rs if the they do 50 trips in a week and 3000 for 40 trips. On top of it they give the clients introductory bonus ,referral bonus and refunds and complimentary/compensatory money if there is a complaint. Free upgrades to higher category cars happen always. Then they have festival offers like the Diwali offer where I got 600 Rs for the 600 I charged my account for. Up to last week they had a 25℅ off and now for the next 10 days they have a 50% off on all rides. That means a per km charge of only 6 Rs. This is not only much cheaper than the autos but also cheaper than what one would spend on diesel if they were to drive their own car. We all know that it is to kill the competition and throw out all the small players. After the consolidation the cartelization will begin. And that is why the CCI should step in. You may wonder how they are doing it. With over 300 million dollars (1800 Crores) in funding by foreign investors (predominantly Japanese) they have very deep pockets to sustain. And for a company that doesnt have its own cars and all that it needs is a call centre and a readily available software/App to run its operations the investment required will be less than 10 crores. We know that 1790 crores is for Operation : Competition Elimination.
Posted on: Tue, 25 Nov 2014 03:14:10 +0000
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