TAXI ALLIANCE UPDATE
iCabbi’s innovative initiative to unite the UK and Irish taxi industry under the formation of a Taxi Alliance will come into effect on March 31. The Taxi Alliance will be a joint venture between iCabbi and independent private hire and taxi companies, which gives taxi fleets security about the future of the software on which they’ve built their businesses. Members get voting rights and the opportunity to hold shares in the Alliance. It’s an unprecedented business model that marks a major shift in the taxi landscape towards a true technology provider-operator partnership. Can it work? PHTM caught up with iCabbi CEO, Gavan Walsh, to find out what the catalyst for this unique business model has been, and what factors will influence its success.
Q A
It’s fair to say this is a sizeable change in how iCabbi has done business until now, so why the Taxi Alliance, and why now?
The short answer is that our customers want security, or need it even, in order to continue planning for the future success of their companies. We devised the
Taxi Alliance to give customers security that their technology won’t be sold out to a competitor. We want to be a true part- ner to the industry and so we’ve created an entity that facilitates true partnership and gives customers the confi- dence and strength to continue asserting their market position and to grow and expand into new areas. Did I say short answer…?
Q A
How does the Taxi Alliance work to provide security and partnership?
Members get voting rights and if any decisions relating to significant dealings with competitors were ever to arise the membership would be able to vote on
these. While there are no plans whatsoever for a sale now if ever this were to happen the TaxiAlliance would retain the right to copy and use the licence for iCabbi in the region. No other provider anywhere in the world offers this kind of secu- rity. Alliance members also get to participate and have a say with representatives sitting both on the Board of Directors and on a special Product Council. Additionally, members get to hold shares - which is something fleets have wanted for years and years and now they have this opportunity.
Q A
What’s different about the day-to-day once the Taxi Alliance comes into effect? Will the price change?
Yes, and it has to. We’re moving to a transparent pricing model. It’s about fairness - everyone should be asked to pay the same in return for the same tech-
nology and service. And it’s about value - and by value I mean delivering a valuable offering, not ‘value’ in the ‘bar- gain basement’ sense. We need to maintain quality, and invest in delivering innovation to the market, so it is impor- tant that the product is priced reasonably to ensure we all stay in business! For some customers the Taxi Alliance, pricing will actually be a reduction in what they pay, for the majority it’s cost-neutral and for others it’s a marginal increase. But for everyone it is fair. Our goal is to be sustainable.
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Q A
Taxi Alliance contracts were issued to customers last week. What options do they have?
Two options really! 1. Sign the contract to become a member and unite with the rest of the industry to build a strong future together. 2. Don’t sign and by
default become a customer of the Taxi Alliance. You can still leave at any time as has always been the case with iCabbi, but by not being a member you will pay a higher price for the technology and you won't benefit from some additional services and opportunities that the Taxi Alliance will provide.
Q A
So customers of the Taxi Alliance continue to have rolling contracts. Are members locked in to a long-term commitment?
No, the member contract is just 12 months. We’re not interested in locking people down, we want them to be happy being members of the Taxi Alliance and
continue to do so. Our retention rate at iCabbi has always stayed in the high 90% range, and I think this is partly down to the freedom we have always given to our customers. They stay with iCabbi because the technology and the service they get is superior to other providers not because we’ve locked them into 3-5 year contracts. There’s no obligation to commit to the Taxi Alliance for any longer than a year.
Q A
Q A
What about shares?
You must be a member to buy shares and it is based on one share per car. All members get 18 months to decide if they want to buy shares or not, it’s called a
share option. It’s a free bet really because the share price is fixed for those 18 months. You can buy shares 17 months in and still pay the same as a fleet who buys shares on day one.
What’s been the reaction from your customers so far?
Well we’ve been talking with our customers about this for over nine months now, so we’ve heard plenty! Due to the complexity of the contract required to make
this work, it took longer than we anticipated to complete the legal processes. Anyone who has ever dealt with solicitors on company matters knows what I am talking about and then multiply that by about 1,000! So, the concept of the Taxi Alliance was welcomed by the industry when we first
MARCH 2022
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