What the Uber-Grab Merger Actually Means for Commuters in the Philippines
We know why Uber sold its Southeast Asian operations. Its finances are rocky at best, and its CEO Dara Khosrowshahi has vowed he will patch up its money matters soon. And by selling its SEA operations to its major competitor, Grab, Uber is cautiously trekking the road less traveled, and less financially perilous. How’s that? Well, both companies share the same backer, Japan’s Softbank, who deems Uber’s exit in the SEA space only sensible, seeing that Grab knows the market significantly better and can thusly render a better service. You can read our previous report here.
But all this is internal Uber-Grab stuff. What about the people who are actually using the service? More importantly: what does this mean to our fellow Filipinos who use Uber and Grab’s service every day? On this post, we relay some key things brought about by this merger.
Longer booking time
The pundits are right: the difference in the number of drivers from pre- and post-merger is slim to none because most Uber drivers are also registered under Grab. However, the number of drivers induces the littlest concern. What’s concerning is the hordes of people who used Uber exclusively and are now forced to Grab’s platform.
When such demand inflates, supply is unable to accommodate at a similar pace and rate. In Grab’s case, I won’t be surprised to hear reports of lengthier booking time because there are now more riders than ever verse the number of drivers.
Grab now stands as the sole major TVN service (at least in the Philippines), accommodating a much wider demand for its service. Pricing will naturally rise. Just weeks into the merger, people are already wincing at the notably higher pricing, chief among them are Senators Grace Poe and Sherwin Gatchalian, who calls out the company for its higher fares, calling it “predatory pricing”.
Taking to his Facebook page, Grab’s Country Head (Philippines) Brian Cu recently assured:
Personally, I’m having a hard time feeling the drop in surge rates. Even if Grab specifically assured that it won’t charge higher than they have been in the past.
The lack of an option is also at the forefront of the SEA Uber-Grab merger. Without a second TVN service, we’re forced to rely on one service. And when it has shortcomings, we’re left without any choice except deal.
Such example is the app’s constantly crashing and refreshing in the background. When it crashes, you’ve literally no other service to fall back on. Further, Grab allows drivers to cancel trips mid-pickup, which is frustrating for riders who have had a hard time booking the said trip. Uber similarly allows their drivers to cancel trips but automatically looks for drivers in replacement for the driver who canceled. This is an area in which Grab, I think, should consider adding to their platform.
The threat of monopoly
No one likes a monopoly—except, maybe, the board game. In Grab’s case, cynics are right to think that there’s a likely possibility that Grab will dictate its own pricing and, because it’s without competition, plateaux in a position that doesn’t incentivize growth.
Less tedious regulations
Having just one TVN service will likely speed up regulations and governance. When change is to be mounted, the government will only have to coordinate with one service, making the process likely (hopefully?) much faster. If Grab is attempting to make changes meant to better its customers’ experience (and man, do I hope that they have some plans), it’d at least be quicker to deliver.