On-demand ride-sharing apps slowly seeing off early roadblocks in Jakarta

A Go-Jek driver and passenger in JakartaA Go-Jek driver and passenger in Jakarta. Photo courtesy Go-Jek.

By: Ardi Wirdana

The buzz surrounding ride-sharing apps in Indonesia has not died down despite serious setbacks. In fact, the regulatory and social roadblocks have arguably invited even more support for these start-ups, which many see as the antithesis to Indonesia’s appalling public transport services.

For a country with a rapidly-growing middle class, the practicality and convenience that these services offer was always going to be a massive hit. But it is the people’s frustration of the notoriously poor state of the Indonesia’s transport system that has made ride-sharing services feel like a breath of fresh air – almost literally.

Many buses and minibuses, now the most popular form of public transportation for inner-city commute, are non-air-conditioned. They therefore have its windows constantly open to allowing the much-polluted air of Jakarta’s busy roads to breeze in. Then there are also problems of under-maintained vehicles, untrained drivers and tiny seating spaces.

Inside a Commuter Line train in Jakarta

Inside a Commuter Line train in Jakarta. Photo courtesy Ardi Wirdana.

The train system, which is often the choice for longer commutes, has seen encouraging improvements over the last few years in terms of facilities and pricing system. But the subsequent surge in new passengers has not been supported with additional train units, forcing the hordes of passengers to cram into tight spaces.

For those looking for a more humane commuting experience, hiring a taxi will probably be their best bet in Jakarta. Picking a taxi ride would obviously be costly, but often passengers are made to pay more than they should. Drivers are notorious for cheating passengers by taking longer routes. On top of that, many drivers would expect or even ‘demand’ a tip. Safety is also a point of concern, following numerous reports of criminal acts by taxi drivers on their passengers.

Perks of Ride-Sharing Apps

Ride-sharing apps for cars, such as Uber, offer not only comfort and practicality, but also a sense of assurance as passengers are given information on the driver’s identity and location through GPS technology.

Payment of fares is also more convenient. Uber for instance gives an estimation of the cost of the trip before ordering a ride, while Uber takes credit card payments which saves passengers the dilemma of waiting for change or leaving it as tip for the driver.

While car-hailing start-ups are enjoying growing popularity, it is their motorbike counterparts that have taken Indonesia by storm. The motorbike’s ability to beat the unbearable traffic in Jakarta is obviously the number one appeal of motorbike-sharing services. But what the ride-sharing apps like Go-Jek have over its conventional counterparts is a clear price information, which saves passenger from awkward roadside haggles with drivers.

Furthermore motorbike-hailing services also provide numerous other perks such as paper face masks (for relief from dust and smog) as well as helmets. They also offer rain gear for wet days and insurance coverage in case of accidents.

The popularity of ride-sharing apps is growing and Indonesia is witnessing a boom in demand of these kinds of services. This has attracted more players to the game. Malaysia’s GrabTaxi has come to the fore and immediately pose as straight competitors to both Uber and Go-Jek, by providing both car and motorcycle services in one app.

Go-Jek is also seeing a host of new local competitors with apps like BluJek, LadyJek and Ojek Syar’i looking to grab their share of the market.

Regulatory Hurdles

The rise in popularity of these start-ups has resulted in difficult hurdles. As the case with most disruptive technologies all over the world, ride-sharing apps in Indonesia have unsettled the status quo, sparking backlash from conventional drivers and regulators.

Since its introduction in Jakarta, Uber has generated a debate over its legality as a transportation company.

The San Francisco-based firm has always maintained that it is not a transportation company as it does not own vehicles, but considers itself more as a technology company which connects passengers and transportation services through its smartphone app.

The transport ministry, however, has emphasised that, as stated in clause in its regulation, every motor vehicle that is used for public with payment is categorised as public transportation. Every public transportation driver is obligated to bring vehicle registration document (STNK), pass the roadworthiness test (KIR), has business permit and operating permit monitoring document.

Though Uber is still free to operate in Jakarta as it has not been banned, the local authorities are keeping a close eye on the start-up.

Like Uber, Go-Jek is also facing legal scrutiny as motorcycles are not legally categorised as a form of public transportation, despite the fact that ojeks have been operating as public service for decades.

The bigger problem for Go-Jek, however, comes from widespread resistance from traditional ojek drivers who have complained, staged demonstrations and even reportedly attacked Go-Jek drivers and office out of resentment towards the start-up who they feel is “stealing their livelihood”.

Public Support to the Rescue

To their credit, Uber and Go-Jek have handled their sticky situations well. Both have refused to be provoked into making a commotion of their situation. They have adequately addressed their respective situations without saying too much and have quietly channelled their energies on providing better services for their customers.

Uber, which initially only accepted credit card payments, have now started to accept cash given the low credit card ownership in Indonesia. They have also recently established a subsidiary in Indonesia to enable it to operate as a local company and achieve compliance.

Go-Jek has also remained calm in the face of threats and attacks aimed their way. The Indonesian start-up has kept quiet amid the debates and continues to and have instead chosen to focus on intensifying marketing efforts and improving pricing and additional services for customers.

Go-Jek interface on smartphone. Go-Jek has been working on providing a range of additional services for its customers.

Go-Jek interface on smartphone. Go-Jek has been working on providing a range of additional services for its customers. Photo courtesy Ardi Wirdana.

Both companies are acknowledging that happy customers will be key to their survival and success in democratic Indonesia, as the people’s power have historically shown that it could influence policies and regulations.

In the case of Go-Jek, the public support may once and for all end the argument over the start-up’s legal status.

In September, the Jakarta Police Chief Tito Karnavian admitted that the police were torn between choosing to allow or ban Go-Jek. He noted that prohibiting Go-Jek operation would be detrimental to the community that had become dependent on it.

He added that the only way that ride-sharing apps like Go-Jek could be banned without causing public outrage is if existing public transportation step up their game and develop services better than that of Go-Jek.

Rather than deciding on the matter, the police, is inclined to pass the task on to the people by asking the Jakarta City Council to conduct a public survey about people’s opinion of Go-Jek.

“We ask that the administration carry out a survey as soon as possible and capture the aspiration of the public, and quickly make a decision,” Tito said, as quoted by Detik.