March 4 (Bloomberg) -- Uber Technologies Inc., the booking-app developer backed by Google Inc.’s investment arm and Amazon.com Inc. founder Jeff Bezos, expanded to Tokyo using licensed taxi operators rather than private drivers.
The company targeted businesses such as taxi companies instead of individuals so Uber could work with licensed drivers that are insured for ferrying passengers, allowing Uber to avoid some of the risks it faces in other cities, Tak Shiohama, who oversees Uber in Japan, said yesterday in Tokyo. Taxi companies in Japan offer separate chauffeured services for hire.
“We contacted companies, and we explained how our system works to them, and asked the taxi companies that own hires to register with us,” Shiohama said. “In Japan, Uber is cleared of all legal issues, in every aspect.”
The Uber app runs on smartphones or tablets in 17 languages and can dispatch a driver to the user’s location at the push of a button. The company seeks to draw users by making it easier for non-Japanese speakers to find rides as the Japanese capital prepares for the Olympic Games in 2020. Uber competes with Tokyo-based taxi companies’ own smartphone apps and global rivals including U.K.-based Hailo Network Ltd.
“With the Olympics heading here to Tokyo soon, we think this language ability will be a big benefit,” Allen Penn, who oversees Uber’s operations in Asia, said yesterday in Tokyo.
Uber added Shanghai last month and is available in more than 80 cities around the world, according to the company.
The service poses a more direct challenge to established taxi services in some other cities because it allows any driver who signs up for the service to make themselves available to pick up riders. Some cities have curtailed Uber and similar apps on concerns about safety and competition with established taxi services.
A test yesterday brought an eight-seater Toyota Motor Corp. van to a reporter’s location within four minutes of making the request via the smartphone app. The ride was free because Uber is offering users who download the app 2,000 yen ($20) in services.
After that, Uber charges 300 yen per kilometer, plus a 100 yen flat fee. Tokyo taxis charge 710 yen for the first 2 kilometers, and 90 yen for every additional 288 meters, according to the Taxisite Inc. website.
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