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del

Eduardo del Buey
Foto: Rodrigo Díaz Guzmán
La Jornada Maya

Mérida, Yucatán
Martes 27 de septiembre, 2016

As Charles Darwin once noted, it is not the strongest who survive, but those who best adapt to change. Technology is rapidly changing business models, and we must adapt or die. If one chooses to stop the waves like King Canute, one risks drowning in one’s own petulance. Such is the nature of change in our time.

Lately we have seen the battle between UBER and traditional taxis in the Yucatan peninsula, one that is taking place in one form or another around the world. Technology is displacing jobs, and rendering traditional business models irrelevant.

Traditional taxi operators, long used to a monopoly, and forming a strong political block, are now facing the UBER onslaught. UBER promises fast, safe, and efficient service at lower prices. Younger voters are speaking out by attacking the government for not supporting the new technology that is youth friendly. Indeed, Paul Antoine Matos of La Jornada Maya reported on September 23rd that 55 percent of Merida’s population has downloaded the UBER app, and 75 percent of these are young people.

And young people – the future of the world -- are challenging an economic model that allows monopolies to run services with little accountability to the public. Technology is freeing them from this type of economic model, they believe, and is providing the market with much needed competition in price and service.

Technology against the status quo.

We are seeing this on a variety of fronts. AirBnB is challenging the traditional hotel industry by offering rooms and homes at a cheaper rate and on more flexible terms that hotels. Amazon.com has been challenging traditional retailers for two decades, and has fundamentally changed purchasing patterns for most of us with internet access.

Indeed, UBER does not own a single cab, AirBnB does not own a single hotel room, and Amazon.com does not own a single bricks and mortar book or department store. Yet each has grown into a global giant in its field.

This is the new economy.

Governments must catch up to this exponential change on the playing field. Legislation must take into account the brave new world we are entering at a rapid rate, and must look at such issues as fair competition, taxation, regulation, consumer protection, fraudulent practices, and the impact on the workforce.

Traditional industries must find a way to adopt new business models to their commercial activities to take advantage of the lower costs for them and lower prices for consumers. Indeed, a hundred years ago horse carriage manufacturers lost out to the automobile industry, cell phone manufacturers went out of business with the advent of smart phones, and companies like KODAK and Polaroid lost significant market share since they lagged in transitioning to digital photography. One either changes and adapts or goes the way of the dinosaur.

That old Danish King Canute once tried to stop the waves with a flip of his hand. Ostriches bury their heads in the sand. Opponents of technological change risk becoming modern Luddites, trying to throw their sabots into the machinery of progress.

None of this works.

Government now has a new role to play. It has to help industry adapt to technologies that are here to stay. It must bring into play legislation that helps industries challenged by technology adapt to change and prepare its workers for this brave new world. It has to create a level playing field for producers and consumers alike.

Industry must use its imagination to create new working models rather than fight the tides. Is there any reason why traditional cab companies can’t adopt UBER principles to provide better and more efficient service? For example, when I lived in Washington DC, it would take a local cab company an average of 25 minutes to reach my house, whereas it took UBER four minutes. A photo of the license plate of the car and a photo of its driver were included in their digital message for security. Payment was by credit card, avoiding the need for cash transactions that can put both driver and client at risk.

Taxi operators are now at a point where they risk losing their hold over the market, and losing the investment they have made in their operating licenses. Is there any reason why they can’t and don’t use UBER-type technology to improve service delivery for their clients? That remains a valid question in today’s technological era.


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