Taxi, Following Tada, Targets Kakao
New Variable in 'Call Manipulation' Suspicion
Low Possibility of Second Tada Incident
[Asia Economy Reporter Buaeri] A subtle tension is emerging between Kakao and the taxi industry as some in the taxi sector claim that "Kakao is funneling calls to its affiliated taxis." The symbiotic relationship between the two parties, which has been based on cooperation through the KakaoT service, now faces a variable in the form of allegations of 'call favoritism.' However, given the weak evidence supporting these allegations and Kakao's active clarifications, the likelihood of this escalating into a 'second Tada incident' appears low. There are also calls for both sides to avoid futile disputes for the joint development of the taxi industry and the mobility sector.
◆Taxi Industry Raises Suspicions Daily... Evidence is Weak = On the 26th, some factions within the National Taxi Labor Union Federation and the National Taxi Transport Business Association raised concerns about call discrimination by Kakao Mobility. Lee Yang-deok, Executive Director of the National Taxi Transport Business Association, said, "For example, if there are 10 taxis at Gangnam Station and a customer calls a taxi via the KakaoT application (app), reports indicate that the call does not go to the taxis present there but instead is received by a KakaoT Blue taxi located farther away." KakaoT Blue is a taxi brand operated by Kakao.
According to the taxi industry's suspicions, when a taxi is called through the KakaoT app, Kakao prioritizes calls to its affiliated service, KakaoT Blue. Currently, about 250,000 taxis operate nationwide, with approximately 5,200 being KakaoT Blue affiliated taxis. Some taxi organizations are considering legal action. Lee Heon-young, Labor-Management Countermeasures Director of the National Taxi Labor Union Federation, stated, "We are seeking legal advice regarding the situation where Kakao unilaterally monopolizes a platform with a public good nature to increase profits, causing losses to other taxi drivers."
With an estimated 25 million users of the KakaoT app domestically, these allegations raise concerns that conflicts between the taxi industry and Kakao could lead to consumer harm. Following the suspension of Tada's service in April due to conflicts with the taxi industry, there is growing worry that the mobility market might again be engulfed in controversy.
◆"Call Favoritism is Completely Untrue"= Kakao Mobility, which has consistently collaborated with the taxi industry, is troubled by the sudden allegations. Kakao Mobility insists, "Since the dispatch system is AI-based, artificial call assignment is impossible."
According to Kakao Mobility, KakaoT calls are automatically assigned not simply based on distance but considering estimated arrival time, driver ratings, acceptance rates, and traffic conditions. For example, if passenger A makes a call and taxi B is within 500 meters while taxi C is 1 km away, taxi B is not automatically assigned. If taxi B has previously declined the destination entered by passenger A or has poor driver ratings, it may not be assigned. Also, considering traffic conditions, even if taxi B is closer, if taxi C can reach passenger A faster by making a U-turn, taxi C may be assigned.
There is also speculation that the taxi industry's allegations are related to the COVID-19 pandemic. With reduced movement due to social distancing and remote work, the overall number of taxi calls has decreased, leading to misunderstandings. It is argued that this controversy should not damage the cooperative system between the taxi industry and Kakao. Professor Choi Kyung-jin of Gachon University advised, "The taxi industry and Kakao Mobility need to grow together in a mutually beneficial way. The taxi industry should adopt a more flexible attitude rather than taking a confrontational stance, and Kakao Mobility should make efforts to enhance transparency, such as regularly providing reports."
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