France invents the “lack of digital vision insurance”

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As many other industries, taxis see their business being challenged by newcomers that try to reinvent the model model and the offer by relying – among all – on the principles and tools of the digital economy.

The most famous of these players is Uber but there are also local ones like Chauffeur Privé, Snapcar

A couple of details before going further, to avoid misunderstandings that sometimes turned valuable conversations into a pointless fights.

The point of the digital transformation of taxis is not about private drivers and their specific status, whatever the country. If all the new players rely on private drivers not all private drivers work for them, so these businesses are not to be blamed for the misconduct of drivers that are not part of the system. I’d even say that having more drivers working for Uber and its likes would eventually lead to less misconduct because these businesses enforce quality charters individuals may not have.

Second, if I’m talking about France it’s not a reason to go into french bashing and the usual “it’s better anywhere else, France is the only country where…”. Should it be about taxis, accommodations (AirBnb) there’s not a city where these new players aren’t under pressure or even prohibited. That does not mean France is coming with the best response but that we’re not the only place where innovation scares old industries.

So let’s go back to the subject.

Concerned about pacifying the debate and find a solution that would please all parts, the french government asked a deputy of the parliament to write a report aiming a setting new rules for this market. And the Thevenoud report is really worth the reading.

To summarize its main ideas, it suggest to force taxis to improve their quality of service. It also suggests taxis should become geolocalizable…what would not be allowed anymore for private drivers.

At first sight it’s good for customers. At least a little.

Taxis would get new obligations but il should lead to better customer satisfactions. But they will also see private drivers weakened by the prohibition of geolocation services for booking.

As for private drivers, those who work the “old” way with their own customers won’t see that many changes. Those who did not use to respect the law will – supposedly – face more control. And those who relied on Uber and its likes to find customers will lose a lot.

The real losers are, in fact, the services that helped drivers to connect to customers, this kind of service being made illegal by the prohibition by geolocation-based booking.

In short taxis would be required to become Ubers & co would not be allowed to continue their activity. A bonus for inaction.

Before I go further, let’s wonder what lead to such a situation. As I already said, digital did not hurt taxis  – or any other industry -, lack of vision did. Large taxi companies already had geolocation systems, where supposed to accept credit cart payment, had invoicing options for premium customers. They used to have anything needed to invent what Uber and others did, take the market and not be challenged by new players. They just had to….but they didn’t.

It’s not a matter of startups, of technology, taxis or drivers. It’s a matter of vision. It’s a matter of being blind in face of an economy that’s going digital. The winners are not on the driver side, either taxi or private one, but on the taxi companies one. And the losers those who come with a new model. Drivers are only the victims of a battle that’s happening elsewhere.

So, what’s the message send by the report ?

The report says to old businesses : “don’t worry if your industry is being disrupted by new players that take advantage of your inaction, let them grow a new market. Once it will be mature we’ll force them to stop their operations and the only thing you’ll have to do is to copy”.

Considering that, the taxis-private drivers war is trivial. But the message send to entrepreneurs and innovating businesses – and even to old ones – is terrible. Don’t try. Don’t question your model. It’s useless : once a leader will emerge we’ll bring everyone back to the starting line.

If the government follows the report, France will be known for having invented the insurance against lack of vision for poorly innovating businesses willing to protect the status quo in a fast changing world.

Sleep soundly.