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InTransition Magazine : Transportation Planning, Practice & Progress

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Cab-Share Services Make Deals on Wheels

Websites Play Matchmaker for Riders Going the Same Way

By Eric Goldwyn

Standing near the Manhattan Bridgeone night, Jonathan McKinney debated whether to spend $15 for a cab back to his Brooklyn apartment or $2 to ride the subway. In a perfect world, the answer would have been something in between.

“I opted for the subway that night, but as I rode the train home, I thought that I would have been willing to pay $5-$8 for the comfort and ease of a cab,” said McKinney, the founder and CEO of CabCorner.com.


NYC & Co.

Cab-share services are being billed as a way for riders to save

money, lower emissions and get cars off the road.

Through his new business, and several others like it cropping up online, that option is now just a few clicks away for people looking to catch a cab in cities across the U.S. Internet-based cab-share services like CabCorner.com, Hitchsters.com, CabEasy.com, SplitACab.com and RideAmigos.com aggregate users’ travel plans and serve as matchmakers for strangers willing to split a cab and a fare. Travelers enter a starting point, destination and time/date of the trip, and the service lets them know if there are any other users headed the same way at the same time. If no similar trip has been filed, the rider can post their travel plans online and let other riders find them.

Most of these services can work in any town in the country, if not in the world. However, because the more users there are, the better the chance of a match, the services work best in the largest cities.

The rendezvous are arranged in different ways. CabEasy, for example, passes along users’ contact information and lets them organize amongst themselves, while other websites create a time and a place to meet. Since the services typically don’t coordinate with yellow cabs or livery cars, they can’t guarantee a cab will be available.

Cab-share supporters say the service gives riders the opportunity to pool resources, lower emissions and help ease congestion. Brook Schaaf, a consultant for SplitACab.com, said his product provides “a market-based solution for people who want the convenience of a cab at a fraction of the cost.”

“[T]he benefits of cab-share go beyond the rider’s wallet,” said Laurent Kretz, the founder, CEO and programmer for CabEasy.com. “CabEasy creates a social network and enables users to self-organize and plan rides to the airport or work while also promoting green practices and bringing people together.”

Traditionally, shared rides have been restricted to shuttle vans (such as SuperShuttle or Airlink) that organize trips by either starting or ending at an airport, train station or other major destination. By organizing riders by point of origin or destination, it is easy to coordinate a trip that picks up or drops off riders along the way. McKinney said cab-share services are the next generation of shuttle vans, which require a reservation 24 hours in advance.

“Thanks to the Internet and mobile devices, like PDAs, CabCorner can bring two, three, or four people together instantaneously,” he said.

Owners Hope Money Will Come

While cab-share entrepreneurs are confident they’re providing a useful service that can turn a profit, they share similar concerns about attracting users and monetizing their business. At the moment, many of these services are free to use, or charge only small usage fees. The owners anticipate that once the businesses become better-known and proven commodities, revenue could come from any number of sources -- subscriptions, advertisements or a portion of the cab fee for livery cars, to name a few.

Kretz believes distribution is the biggest obstacle facing CabEasy as it tries to popularize its service. “How do I get CabEasy into the users’ hands?” he said.


A number of cab-sharing websites have

recently been launched, but so far their

owners have struggled to make them

profitable.

After receiving positive press coverage in late 2008, CabEasy received 30,000 visits during the first three months of 2009. However, Kretz has been unable to retain those early visitors and convert them into repeat users. And when SplitACab launched in 2006, the site “received a flurry of interested visitors, but we didn’t have the resources to turn them into loyal customers,” Schaaf said.

Supply and demand obstacles have made matters more difficult. Although cab-share hasn’t yet gained widespread buy-in among consumers, the number of providers has sharply increased over the last three years. Since the start-up costs and barriers for web-based services are modest, many cab-share sites were developed on a lark. Schaaf said that for his service to be successful, he will need to create a sensible business plan and attract investors.

“We’ll need to raise money to grow the business, turn a profit, and reach a critical mass of users,” he said.

While Schaff didn’t pinpoint a specific figure, he acknowledged that “it’s not a question of another $10,000,” implying that a serious effort to reach the public en masse would require a minimum of hundreds of thousands of dollars. Kretz agreed, and said he plans to commit himself full-time to developing CabEasy’s website and business plan while raising money from investors in his native France.

Faced with financial difficulties that threatened to cause fare increases, service cuts and overcrowding on its mass transit lines, New York City set out early this year to find ways to extract more capacity from its existing transportation network. At the end of May, the city’s Taxi and Limousine Commission (TLC) announced the launch of a pair of “share cab” pilot programs that will accomplish some of the same goals as cab-share services.

The first of the two programs, expected to launch this year, will set up group-ride pickup stands at a handful of major commuter hubs during morning rush hours. Cabs will be assigned to drive through a few strategic corridors (Penn Station to 59th Street, for example) and drop off riders anywhere along the way for a flat fee. Under the second program, set to begin in 2010, 1,000 cabs will be outfitted with LED signs that show their destination to people on the street. Someone headed to the same neighborhood could hail the taxi and split the cost 50-50, with multi-fare meters allowing each passenger to track their portion.

Unlike the cab-share services described above, though, the city has no plans to coordinate riders and cabs via the Internet. The only way to hail a moving share cab is with a whistle, a wave of the index finger or whatever trick brought you luck in the past.

Eric Goldwyn is pursuing a Ph.D. in urban planning at Columbia University.

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