Russian firm Yandex to introduce yet another taxi-hailing app to Estonian market (4)

Yandex.Taxi, a Russian taxi-hailing app, is planning on entering the Estonian market this fall. (Sergei Shakhidzhanyan/TASS/Scanpix)
By Maria-Ann Rohemäe
7/27/2016 12:48 PM
Category: Business

Russian IT firm Yandex is planning on introducing its taxi-ordering app Yandex.Taxi to Estonia in the near future. According to Estonian transportation network company Taxify, however, the Estonian market is already oversaturated with taxi apps and competition for drivers is stiff.

Russia's largest IT firm Yandex's taxi-ordering app Yandex.Taxi is currently available in Armenia and Belarus in addition to its native Russia, and the company plans to expand its services to Kazakhstan, Georgia and Latvia, reported ETV's nightly news broadcast "Aktuaalne kaamera."

The Russian taxi-ordering service currently plans to begin operation in Estonia sometime during the second half of September in cooperation with local taxi companies.

"Our job is to provide a platform that everyone can download and use and with which it is possible to pay conveniently," explained Yandex.Taxi director Tigran Hudaverdjan. "The local business' job is to provide drivers, find vehicles, buy them, and fill orders received via Yandex.Taxi."

Taxify co-founder and Expansion Manager Martin Villig found, however, there are already too many taxi apps available in Estonia, adding that Taxify and Yandex could cooperate instead of competing on the small Estonian market. Villig confirmed that the two companies have discussed this possibility.

"There are a few examples in the world of some taxi apps offering something like a roaming service on cell phones — you can order [taxis] using your app in another country as well," said Villig, pointing out an opportunity for integration. "That is one possibility. Another opportunity would be acquisitions of corporate holdings or a joint venture."

Hudaverdjan, however, stated that Yandex.Taxi had no plans for cooperation with anyone in the near future.

According to Villig, the stiffest competition in Estonia was for drivers, and Taxify was constantly seeking additional taxi and private drivers. He found that this competition hampered growth for all taxi-service apps.

Uber Estonia General Manager Enn Metsar did not agree with this claim, however.

"We train dozens of [new] drivers per week," said Metsar. "Of course all of them are not always in town, that depends on a person's individual schedule, but we can see that interest in using the Uber platform as a driver is actually quite high."

In addition to Tallinn, Estonia's Taxify app can be used in Tartu, Pärnu, Kuressaare, Viljandi and Rakvere. Uber currently only operates in Tallinn, however it is interested in expanding to other cities in Estonia.

Yandex.Taxi is slated to operate likewise only in Tallinn during its first year of operation, but is considering expanding elsewhere beginning next year.

Editor: Aili Sarapik

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