Upstart ride-hailing services fail in South by Southwest test

  • TECH
  • Monday, 13 Mar 2017

A driver displays Uber and Lyft ride sharing signs in his car windscreen in Santa Monica, California, U.S., May 23, 2016. REUTERS/Lucy Nicholson/Files

Startups Fasten and RideAustin saw South by Southwest, the annual technology, film and media gathering in Austin, Texas, as their biggest test since they replaced Lyft and Uber as the city's predominant ride-hailing services last May. 

Neither one got high marks on the night of March 11. Drivers and passengers complained that the apps were down for an hour or two, just as partygoers were trying to move from one place to another on a rainy evening. 

Fasten says that demand was 12 times the normal levels for Saturday night. In addition to general outages, some riders complained of very high surges in pricing and of being charged for cars that never arrived. 

“Shows just how good Uber is,” wrote Daniele Fiandaca on Twitter, after saying she was quoted US$60 (RM267) for a ten-minute ride on Saturday morning. 

Uber Technologies Inc and Lyft Inc abruptly stopped operating in Austin almost a year ago in protest of a law that required drivers to be fingerprinted. Several new companies stepped up to fill the void. Austin currently has seven ride-hailing apps operating there. Fasten and RideAustin have become the leaders, and Fasten in particular was looking at SXSW as a coming-out party of sorts as it attempts to raise a US$20mil (RM88.93mil) fundraising round and move into new markets. Its performance on Saturday couldn't have helped. 

“It wasn't the greatest page in our history,” said Kirill Evdakov, the company's chief executive officer. “Hopefully we can regain the trust.” Evdakov said the company has added additional server capacity and shut off non-essential parts of the app to try to ensure reliable service. A representative for RideAustin didn't respond to an interview request.  

Both Fasten and RideAustin had attempted to increase capacity in advance of the event by recruiting drivers. RideAustin placed Craigslist ads in Houston and San Antonio trying to convince people to drive in for the week. But with the apps down for parts of Saturday night, it was hard for drivers who were trying to use the system to find work. 

Poor performance this week could be damaging to Fasten and RideAustin as they look to retain their workforces and customer bases. There are several bills in the state legislature that would almost certainly lead to Lyft and Uber returning to the city if they are passed. At that point, the newcomers's grace period will have ended. — Bloomberg

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