[Asia Economy (Suwon) = Reporter Lee Young-gyu] Empirical research has revealed that the monopoly platform companies in the taxi-hailing and accommodation reservation markets, 'Kakao Mobility' and 'Yanolja,' discriminate between franchisees and non-franchisees.
Gyeonggi Province announced on the 31st of last month the results of a survey conducted in December last year targeting 11 cities in the province?Seongnam, Yongin, Bucheon, Anyang, Ansan, Hanam, Uijeongbu, Namyangju, Yangju, Guri, and Gwacheon?where the proportion of Kakao franchise taxis is high among the 18 cities and counties operating Kakao franchise taxis in the province.
The survey results showed that the dispatch rate for Kakao franchise taxis averaged 43.3%, which is 2.4 times higher than the 17.7% ownership rate of Kakao franchise taxis in the 11 regions. The number of calls for Kakao franchise taxis recorded 27.6%, which is 9.9 percentage points higher than the franchise taxi ownership rate (17.7%).
The province confirmed some cases where, when placing franchise and non-franchise taxis at the same location and calling via the Kakao Taxi app, calls were first sent to franchise taxis, and if the franchise taxi declined, the call was then passed to non-franchise taxis. It also added that there was a so-called 'call quality difference,' where the call details for franchise and non-franchise taxis differed despite being at the same location.
A provincial official stated, "This survey by Gyeonggi Province is meaningful in that it investigated on-site whether Kakao Mobility's claim that dispatching is fairly conducted according to artificial intelligence algorithms is true," and added, "To accurately verify Kakao Mobility's preferential treatment of franchise taxis, a full investigation including algorithm disclosure seems necessary."
To ensure the fairness of this survey, the province adopted a consumer survey method that checked whether a franchise or non-franchise taxi was dispatched when consumers called a taxi via the Kakao app, and a business survey method comparing the number of taxi calls for franchise and non-franchise taxis at the same location and time. Notably, the survey was conducted during the daytime on Tuesday, Wednesday, and Thursday, excluding days with significant traffic volume changes such as Mondays, Fridays, and weekends.
The province also revealed that discriminatory practices between Yanolja's franchise accommodation providers and general accommodation providers are serious.
As a result of investigations conducted twice in September and November last year by checking the exposure positions of franchise stores on the Yanolja app, it was found that franchise stores were mostly positioned at the top, while general stores were pushed down to the bottom.
The first survey in September last year showed that in the Gyeonggi Province category search on the Yanolja app, there were 89 accommodations per sector across 26 sectors, with the average position of Yanolja franchise stores being 17th. In the second survey two months later in November, among an average of 96 accommodations per sector, the franchise store position was recorded as 21st.
A provincial official pointed out, "To finally confirm whether preferential treatment was given, a detailed investigation into the contracts between the platform and franchise stores is necessary, including comparing the advertising fees paid by franchise stores to be exposed at the top and those of accommodation providers located before and after them."
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