Google, which is known for venturing into new businesses, is now working on a carpool service called RideWith. The trial for the service, which went live this week, is underway in Israel with the help of the navigation app Waze, which was acquired by Google in 2013 for $1 billion.
How the Google service works
Waze’s navigation system helps in locating routes that drivers frequently use to get to work and will match them with people looking for a ride on the same route. For a lift, the passengers only have to pay a nominal charge, depending on distance traveled, fuel consumption and depreciation. Also on each fare, Waze will take a cut, which will be paid through the app using a credit card. To prevent the service from turning into a big business, each day drivers will be restricted to two journeys, and that too only during rush-hour, according to Google.
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“We’re conducting a small, private beta test in the greater Tel Aviv area for a carpool concept, but we have nothing further to announce at this time,” Waze told Reuters.
If this carpool service turns out successful during the trial in the Israeli cities of Tel Aviv, Ra’anana and Herzliya, Google will replicate it elsewhere in the world. In Israel, RideWith is expected to help with the problem of terrible traffic and sky-high car and gas prices. Owing to the high taxes on new cars and high gas prices, driving a car in Israel is much more costly than it is in the U.S.
Will it clear regulatory obstacles?
Taxi and ride-sharing services like Uber have faced numerous regulatory barriers in several countries such as Germany, France and the Netherlands. Regulators in many countries have been favoring taxi drivers by banning Uber’s services, which enable private cars to provide taxi services.
In California, Sidecar’s carpool service has already been found to be against the law. California regulators noted that it is unfair to charge a separate fare to each passenger even though there are more than one in the car. However, Google believes RideWith is not likely to come across any such regulatory hurdles as the app deter drivers from turning the service into a profitable business. Whether or not regulators will accept Google’s reasoning remains to be seen.