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HomeOpinionHow RIDE's Monopolistic Tactics Harm Ethiopian Communities 

How RIDE’s Monopolistic Tactics Harm Ethiopian Communities 

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Ethiopia - Ride Sharing
Source : SM

JO “Concerned Citizen” 

Addis Ababa, the bustling capital city of Ethiopia, has witnessed a remarkable surge in urbanization in recent years, resulting in a soaring demand for public transportation services. In response to this pressing need, several taxi booking platforms, including RIDE, FERES, and others, have emerged. While these platforms initially provided convenient services to both passengers and drivers, they have now succumbed to aggressive and monopolistic practices that pose a grave threat to the livelihoods of low and middle-income citizens. This article aims to shed light on the detrimental effects of RIDE’s anticompetitive business model on the public and propose compelling solutions to address these pressing issues.

In the past, companies like FERES and RIDE competed in a manner that truly benefited customers, offering affordable prices, reliable service, and exceptional customer support. FERES, in particular, gained immense popularity for its commitment to delivering a satisfactory customer experience. However, FERES recently introduced FERES plus, a program that entices car owners with exaggerated incentives by drastically increasing the commission it takes from each fare. 

RIDE’s tactics amount to predatory pricing, severely undermining Ethiopia’s burgeoning economy. By sabotaging competitors, they stifle job creation within the sector as a whole. As public transit becomes increasingly unaffordable and inaccessible, inequality intensifies, leaving the less privileged with limited access to education, employment, and essential services. The consequences are dire. In order to compensate for paying drivers more, RIDE has exponentially hiked passenger fares. What used to be a reasonable cost for utilizing taxi services across Addis now comes at a significantly higher price. This disproportionately impacts low-income communities that heavily rely on public transit. 

The repercussions of RIDE’s actions extend beyond the passengers themselves; car owners are also burdened with higher commissions imposed by RIDE. Consequently, the cost of hiring a taxi becomes prohibitively expensive for many low-income citizens, making it exceedingly difficult for them to access vital services such as healthcare, education, and employment opportunities. 

However, RIDE’s aggressive pricing strategies are not the sole issue; the company also engages in monopolistic behavior by suppressing competition from other taxi booking platforms. By offering exaggerated incentives to car owners, RIDE manages to maintain a near-monopoly in the market, effectively impeding new players from entering the industry. This lack of competition inevitably leads to a decline in service quality, as RIDE lacks the motivation to improve its services to meet the needs of its customers. 

The impact of RIDE’s anticompetitive business model on low-income citizens is nothing short of significant. Countless individuals rely on public transportation to commute to work, school, or medical appointments. However, the exorbitant fares charged by RIDE render these services unaffordable for them. Consequently, they are left with no choice but to walk or resort to alternative modes of transportation, which can be perilous and time-consuming. Moreover, the absence of competition in the market means that those who cannot afford the exorbitant fares have limited options, further exacerbating the problem.

To effectively address the issue of RIDE’s anticompetitive business model, several decisive steps need to be taken. Firstly, the government must establish robust regulations that prevent companies from engaging in monopolistic practices. This could involve implementing price caps, mandating companies to disclose their pricing strategies, and enforcing penalties for non-compliance. Secondly, the government should consider providing subsidies or financial assistance to low-income citizens, ensuring their access to public transportation services. Finally, the government should actively encourage the development of new taxi booking platforms that offer superior services and lower fares, thereby fostering healthy competition in the market. 

Anticompetitive business models pose a significant threat to the well-being of low- and middle-income citizens in Ethiopia. By employing aggressive pricing strategies and stifling competition, RIDE makes public transportation unaffordable and unreliable for countless individuals. To rectify this issue, the government must take swift action to prevent monopolistic practices and promote healthy competition in the market. By doing so, we can ensure that public transportation remains accessible and affordable for all citizens, regardless of their income level. 

The people of Ethiopia deserve open markets where quality companies compete in a manner that benefits customers and society as a whole. RIDE’s aggressive approach, however, does the opposite, prioritizing profits over people through anti-competitive behavior that ultimately harms Ethiopia’s most vulnerable population. It is imperative for regulators to intervene promptly and restore fair competition, thereby guaranteeing affordable mobility for all.. 

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Editor’s note : Views in the article do not necessarily reflect the views of borkena.com 


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