Leading cab companies Ola and Uber have been sent notices by the Central Consumer Protection Authority (CCPA) seeking clarity on their pricing disparities. This action is taken because of the complaints that users are charged higher prices for the same ride who book the cabs from their iPhones than those who use Android phones. On January 23, 2025, the Union Minister of Consumer Affairs, Pralhad Joshi, tweeted, “As a follow-up to the earlier observation of apparent differential pricing based on the different models of mobiles (iPhones/Android) being used, Department of Consumer Affairs through the CCPA, has issued notices to major cab aggregators Ola and Uber, seeking their responses”.
As a follow-up to the earlier observation of apparent #DifferentialPricing based on the different models of mobiles (#iPhones/ #Android) being used, Department of Consumer Affairs through the CCPA, has issued notices to major cab aggregators #Ola and #Uber, seeking their…
— Pralhad Joshi (@JoshiPralhad) January 23, 2025
The allegations against Ola and Uber over price disparities based on the operating systems have come into the headlines in the last month when Minister Pralhad Joshi described the incident as unfair trade practices and sought the conduction of a detailed inquiry on the matter to get a clear report. Replying to a news report last month on X (Formerly Twitter), Joshi mentioned that there will be “zero tolerance for consumer exploitation”.
Zero tolerance for consumer exploitation!!
— Pralhad Joshi (@JoshiPralhad) December 26, 2024
This Prima Facie looks like Unfair Trade Practice where the cab-aggregators are alleged to be using Differential Pricing based on the factors mentioned in the article below. If so, this is blatant dis-regard to Consumer’s right to know.… https://t.co/Iq7FXE6ROc
The news report which was replied to by Joshi, has revealed the price disparities of the cab aggregators on Android and iPhone for three trips. According to the news report, the cab fare for the trip from Madipakkam to Phoenix Mall Velachery is identified as 195 Indian rupees for Android users, whereas the same trip is priced at 260 Indian rupees for iPhone users. The second trip from Avadi to Chennai Airport has been shown a fare of 961 rupees on an Android phone and 1010 rupees on an iPhone. Similarly, the fare displayed for the trip from T Nagar to Egmore on iOS was 144 rupees higher than the fare for the same trip on Android.
The current efforts of CCPA to send notice to the cab aggregators Ola and Uber reflect their emphasis on ensuring fairness and transparency in the ride-hailing sector. In this regard, Uber and Ola are required to explain the process of determining their fair structures along with mentioning the role of the operating system of the users, if any, in the calculation of trip costs. Regarding this allegation, a spokesperson for Uber has said that the company does not set their pricing strategy on the basis of the phone manufacturer of the rider. They will try to provide emphasis on communicating with the Central Consumer Protection Authority to address any misunderstanding.
Previously, the company also said that they do not have a policy regarding the personalization of a trip cost from the perspective of the phone model of riders. If there are any price disparities, then several factors such as distance, estimated time to reach the destination, and real-time demands in a particular area for cabs are responsible for the differentiation.
People have also shown their concerns regarding similar issues related to quick commerce and food delivery apps and other areas. For example, in the post of Joshi on X on price disparities, an individual requested for analysis of the subscription prices of entertainment services such as YouTube Premium and Spotify, mentioning that they have to provide around 30 per cent extra charges on iPhone for the usage of the same service. Minister Joshi also asked the CCPA to focus on the other sectors, such as online ticket booking apps and food delivery apps, to find out if there are price disparities between Android and iOS users.
Previous controversies related to Uber
Uber is one of the most favourite mobility companions for the people in India. The data obtained from the Uber Newsroom has revealed that around a record 6.8 billion kilometres have been covered through its trips in 2023. The Indian cities in which the company covers the highest number of trips include Delhi-NCR, Hyderabad, Bangalore, Pune, Mumbai and Kolkata. However, apart from the current price disparities allegation, the company has been seen to be associated with several controversies and criticisms in previous times.
For example, Uber India had to pay 54000 rupees to a South Delhi doctor because the doctor had reported a case on the company in the district consumer commission for its poor services. On 29th November 2021, the doctor was found to be booking a ride and waiting for the taxi driver. However, despite confirming the booking, the taxi driver did not come to the place and even did not pick up the call to the doctor. Any help was also not gained from the customer support of the company. As a result, the doctor had to cancel the trip and book a local taxi.
However, the doctor did not reach the airport at the correct time and missed the Vistara flight and therefore, he booked a ticket for another flight on the same day with the double price. Moreover, many customers are found to have complaints against the company which include unprofessional driver behavior, increased pricing, extended wait times, and cancelled rides. There are also allegations against the company by its employees regarding its poor workplace culture.
About Ola Cabs and related previous controversies
Established in 2011, Ola has become one of the largest and most popular ride-sharing platforms in India. The company has facilitated smart transportation options to more than 125 million users in India. Ola has a network of more than 1 million driver-partners and provides services across over 110 cities. The cab company Ola also faced several criticisms for its poor services apart from price disparities. The safety of women passengers across their platforms becomes a major concern. In this regard, a woman in the last month has shared her terrifying experience on her LinkedIn account.
The woman said that during the trip to Gurgaon, she experienced significant safety issues. According to the woman, during the journey in the cab, the driver unexpectedly stopped the car in an isolated area despite the request of the woman not to stop the car. Then, the driver was found to be communicating with a man by the roadside while another two men joined later. The SOS button of the cab app Ola also did not work when the women required support. Finally, the woman is determined to escape from the place to ensure her safety.
FAQ
1. Why did the Central Consumer Protection Authority (CCPA) issue notices to Ola and Uber?
Leading cab companies Ola and Uber have been sent notices by CCPA because of the complaints that users are charged higher prices for the same ride who book the cabs from their iPhone than those who use Android phones.
2. What specific price disparities were reported between iPhone and Android users?
According to a news report, the cab fare for the trip from Madipakkam to Phoenix Mall Velachery is identified as 195 Indian rupees for Android users, whereas the same trip is priced at 260 Indian rupees for iPhone users. The second trip from Avadi to Chennai Airport has been shown a fare of 961 rupees on an Android phone and 1010 rupees on an iPhone.
3. How has Uber responded to these allegations of price disparities?
Regarding the allegation of price disparities, a spokesperson has said that the company does not set their pricing strategy on the basis of the phone manufacturer of the rider. They will try to provide emphasis on communicating with the Central Consumer Protection Authority to address any misunderstanding.
4. What other sectors are subject to investigations relating to price disparities?
Minister Joshi asked the CCPA to focus on other sectors, such as online ticket booking apps and food delivery apps, to find out if there are price disparities between Android and iOS users.
5. What is the CCPA’s stance on consumer exploitation?
Minister Joshi mentioned that there will be “zero tolerance for consumer exploitation”.