At the event, CEO Joo-hwan Jung explained various attempts and achievements for the transformation of the mobility, the impact on the ecosystem, and announced various plans such as strengthening taxi calling function, taxi-carpool connection, B2B and global business expansion.
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| ▲ Joo-hwan Jung, CEO of Kakao Mobility, made a presentation and a question-and-answer session. |
According to Kakao Mobility, taxi calls have increased 2.5 times over the past two years, while the number of available taxis has increased only 1.4 times. As a simple example, about 230,000 Kakao T taxi calls were made during the first hour from 8 am on December 20 last year, while about 26,000 taxis (excluding taxis in operation) were available at that time. More than 80% of calls could not be supplied. Especially when weather conditions such as snowfall, large-scale performances or events cause specific demand, the gap between supply and demand worsens.
The difference between the demand and supply of the taxi is analyzed as the fundamental cause of the taxi riding problems in commuting, midnight, and urban areas. In particular, the gap between supply and demand gap is aggravating with decreasing number of taxis running since 2013.
Kakao Mobility has been working with various stakeholders such as the Ministry of Land, Infrastructure and Transport, the Seoul Metropolitan, and the taxi industry to find solutions to these problems. It predicts the taxi demand using big data and pre-announces to drivers, and it is also implementing a policy to expose long distance calls to drivers who received many short distance calls. However, it is pointed out that these methods have limitations in solving the fundamental cause of the gap between supply and demand.
As the first goal of the year, Kakao Mobility will enhance the motivation of its drivers and strengthen the calling function. First, in order to increase the supply of taxi service, a 'point' system will be operated for taxi drivers. It is a concept of paying points that can be exchanged according to the service performance and evaluation. This is to create a virtuous circulation that can make drivers respond to many call requests by giving more active motivation.
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| ▲ The main theme of profitability and the next generation as the economies of scale are partly achieved. |
Kakao Mobility will also enhance the call function for more efficient taxi dispatch. The added call function consists of two paid options, including 'priority call' and 'immediate dispatch', and passengers can choose whether to use or not depending on situations. ‘Priority call’ is an option of priorly making a call request to a taxi with a high probability of success of dispatch by utilizing AI, and ‘immediate dispatch’ makes an immediate dispatch to the nearby empty taxi. The free call option as the present one will be still maintained, and the payment is made when the dispatch is confirmed after selecting ‘priority call’ or ‘immediate dispatch’.
In addition, in order to solve the problem of supply shortage compared with the demand of the taxi, Kakao Mobility made a plan to supplement the taxi demand through carpool service. If the calls that have not been connected to drivers at Kakao T taxi are connected to carpool, it is expected that a significant portion of the supply shortage could be replaced by carpool. What’s more, it is expected not only to increase user convenience but also to improve traffic congestion and urban environment. Kakao Mobility will work hard to create an alternative to effective mobility within the legal framework, to prepare a service for it, and to create a stage for smooth communication and cooperation between the taxi and carpool industry.
The AI-based dispatch system introduced since early this year is also improving the connection between passengers and drivers more effectively. It is a concept of matching passengers with drivers who have a high possibility of connection by applying deep learning technology based on the big data such as much accumulated call information, driving patterns of drivers, and traffic situation.
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| ▲ The strategy of continuing service growth with results stood out everywhere. |
The second goal of this year is the establishment of B2B business. Kakao Mobility recently started off on the track of its profitability in B2B areas, such as launching 'Kakao T for Business', a service dedicated to corporate members. It provides the company with a system that makes it easier to use taxis for business purposes such as business trips and outings of corporate employees and make a charge. Kakao Mobility estimates about 15% of all taxi demand for business purposes. Kakao T for Business plans to expand into various enterprise mobility service areas including a luxury taxi and chauffeur service beginning with a regular taxi.
The third goal is to expand the global business. Kakao Mobility plans to provide cross-border call service to users in both Korea and Japan through cooperation with Japan Taxi in Japan from the second half of this year. A Japanese user who visited Korea can call a taxi using ‘Japan Taxi’, and a Korean user who visited Japan can call a taxi in Japan by using Kakao T Taxi. Through ‘Easi6 Korea’, which was invested by Kakao Mobility in December 2017, Kakao Mobility plans to launch a business that connects local transportation means when domestic users visit Hong Kong, Taiwan, and Southeast Asia.
Kakao Mobility will also offer a variety of services using AI and big data. It plans to introduce 'Kakao I', which is Kakao’s integrated AI platform, to Kakao T. Moreover, it is continuously upgrading 'future driving information', which shows predicted traffic information at a desired time, and dispatch systems based on and deep learning.
The company also plans to participate in an autonomous vehicle ecosystem through collaboration with ‘Mars Auto’, an AI-based autonomous navigation software company, invested November 2017. Currently, it has set up the goal of securing competitiveness in the autonomous vehicle sector by promoting various new projects and has been establishing an autonomous vehicle-related organization.
The investment and acquisition of mobility start-ups are expected to continue. Since 2017, Kakao Mobility has actively invested in and acquired mobility start-ups such as 'Mars Auto', an autonomous vehicle start-up, 'Easy Six Korea', a Limousine business start-up, and ‘Luxi’, a carpool start-up.
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| ▲ In the next generation, artificial intelligence and the autonomous vehicle will be the two main themes. |
Kakao Mobility said that the number of mobile services that have been provided has exceeded 2.3 billion. It is the total of the number of taxis, chauffeur service, parking, and navigation use. Kakao Mobility is envisioning a variety of mobile innovations that can add value to life by using AI and massive big data.
Indeed, Kakao Mobility has created new experiences and innovations in a variety of moving areas, including taxis, chauffeur service, parking, and navigation. In its third year of launch, Kakao T Taxi has grown exponentially by providing new connectivity experiences for both users and employees. The cumulative number of Kakao T Taxi is 400 million and 240,000 drivers, more than 96% of the nation’s taxi drivers, have joined.
By changing the concept of a taxi from "catching" to "calling," users are provided with a convenient and safe experience of taxi use. According to a survey by the Seoul Research Institute, taxi drivers' profits increased by more than 20%, creating a value of 1.1 trillion won per year, and social costs of 135 billion won decreased per year as the time of empty taxi decreased by 17%. In addition, it has created various positive effects such as improvement of kindness and change of appellation by rating evaluation system. Kakao T Driver, which has been in service for two years, has also grown steadily, reaching 14 million cumulative usage and 3.4 million subscribers.
CEO Joo-hwan Jung emphasized by saying, “Kakao T Driver has also been focusing on eliminating the inconvenience experienced by both employees and users just like Kakao T Taxi. Moreover, I would like to put a lot of stock on contributing to the creation of a healthy ecosystem by bringing unreasonable practices and problems that existed in the chauffeur service industry to surface and taking the lead in improving it.” Also, he revealed his strong ambition. “We will innovate connections in life by actively utilizing big data and AI from various services.”
