Company Spotlight

Taxis Call A Truce In NYC, Sort Of

New York City’s two competing systems to pay for cab rides by mobile app have struck a truce, so passengers no longer have to guess which one works in what cab. On Wednesday (Sept. 10), VeriFone, whose Way2ride system worked in about half of NYC’s 20,000 cabs, and startup Creative Mobile Technologies (CMT), whose RideLinQ worked in the other half, said all NYC cabs can now work with either app.

For passengers, that means there’s no longer a 50-50 chance that their preferred taxi-payment app would fail. The two systems weren’t distributed among cabs in an obvious way — say, with one system in the city’s roughly 14,000 yellow taxis and the other in the 6,000 green cabs, or with one system in cabs operating in Manhattan and Staten Island and the other in cabs based on Long Island.

“Previously, the taxis in which each app worked were not identifiably different on the outside,” said Jason Gross, VeriFone’s VP of marketing and strategy. “A rider could see which app was accepted only upon entering the cab.”

The new interoperability simplifies things for drivers, too: They no longer have to deal with passengers scrambling for an unexpected way to pay.

But the shift wasn’t quite as easy as it sounds because the two systems use different approaches for the the taxi to identify itself to the mobile phone with each app. CMT’s RideLinQ required the passenger to enter a seven-digit code displayed on the taxi’s touch screen—a simple, cost-effective way to ID the cab without additional hardware. Meanwhile, VeriFone’s Way2ride used an ultrasonic signal to tell its app what cab the rider was in.

That meant that before the two systems were harmonized, there was no way for one company’s app to identify a cab equipped with the other company’s system, so the driver could be notified that the fare was paid.

But now, if the Way2ride doesn’t detect an ultrasonic signal, it prompts the user to key in the seven-digit RideLinQ code. (The companies didn’t confirm exactly how VeriFone cabs communicate the cab ID to the RideLinQ app.)

Once the taxi has been identified to the app, the transaction is handed off by each app to either VeriFone or CMT for processing and to confirm to the driver that the passenger has paid the fare.

The companies didn’t say how transaction fees are being split when one company’s app is used for the fare in another company’s taxi.

And the competition between the two systems is still there — it has just shifted away from passengers and to drivers. In August, the city made another 6,000 taxi permits available, a 30 percent increase in the number of cabs. CMT and VeriFone will be competing on what’s essentially a cab-by-cab basis to get their payment systems into those new cabs.

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Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. The September 2019 Mobile Order-Ahead Tracker, serves as a monthly framework for the space. It provides coverage of the most recent news and trends as well as a provider directory that highlights key players across the mobile order-ahead ecosystem.

 

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