Softbank is the Real King of Ride-Sharing Apps, and That May Not Be Great News for the Rest of Us
This week has seen another announcement from Japan regarding a deal involving SoftBank acquiring a stake in the development of driverless technology. This time, the news was about a deal inked last week between SoftBank and Toyota that will launch an autonomous mobility company destined to deliver on-demand service to people’s doorsteps via what is being dubbed as a Robo-Car.
Initially, the service is thought to be designed to service the needs of the increasing numbers of aged citizens in the country. The new company is called Monet Technologies Corp, which is a short form of Mobility Network and has nothing to do with some long-dead French painter, will be based on the Toyota e-Palette, which is a multi-purpose autonomous vehicle that can be configured to fulfil a number of roles, including a mobile hotel room.
Read about it in The Future of In-Car Tech.
SoftBank’s founder, Masayoshi Son, who incidentally is listed as the richest man in Japan, has been actively following what he describes as a cluster approach to his investments, with a number of high profile investments in future autonomous mobility technologies. The company recently invested US$2.25 billion in GM’s autonomous vehicle business, cruise automation and in chipmaker, Nvidia, a key supplier of autonomous technology; it also has investments in the likes of Mapbox, a mapping platform, and Light, which uses AI for 3D special recognition, and many others.
But it is in the realm of ride-sharing that SoftBank reigns supreme. To date, it has invested in Uber, Singapore’s Grab, India’s Ola, China’s Didi Chuxing and Brazil’s 99. We have already seen Uber sell its share of the Chinese market to Didi and its Malaysian operation to Grab; now it would seem that SoftBank is in an ideal position to convince Uber to concentrate on those markets where they are capable of making a profit and leave other markets, essentially giving a free hand to the likes of Ola and Grab, which, of course, should increase the profitability for all involved, especially SoftBank.
So, why is this not such great news for us consumers? Well, up to now the competition between the ride-sharing apps to gain market share has seen rides being subsidised. Once the competition goes, then the prices will rise, which means that we all pay more for our ride-sharing service. Competition is also one of the motors of innovation and increases in quality. As we have found out in Kuala Lumpur, where we now have one dominant ride-sharing company, the prices have gone up and the availability of rides has gone down since Uber exited the market, neither of which is good news for the users.
For the record, Monet Technologies think that its vehicles will be too expensive for consumers in the short term, and thus will be better suited to commercial applications and service, such as delivering food or medical service to remote areas.