Google is jumping into the ridesharing market with a new carpooling service, RideWith, launched this week by Israeli mapping company Waze. The mapping startup, which Google purchased for $1.1 billion in 2013, is doing a test launch of the ride-sharing service in Israel.
Google $GOOGL is jumping into the ridesharing market with a new carpooling service, RideWith, launched this week by Israeli mapping company Waze. The mapping startup, which Google purchased for $1.1 billion in 2013, is doing a test launch of the ride-sharing service in Israel.
The news follows longstanding rumors that Google would at some point upend the transportation industry with a fleet of self-driving cars. RideWith takes a different tack, recruiting work commuters who want to earn some cash by picking up other commuters on their way to work. In theory, the emphasis on non-professional drivers distinguishes the project than other car-sharing apps like France’s BlaBlaCar, which bought German carpooling app Carpooling and grew rapidly this year. Its driver intel will be used to pair up drivers and riders taking the same route, ().
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Riders will pay a suggested fee, suggested by Waze, based on the length of the trip and the automobile maintenance cost in Israel and calculated by Israeli information technology company Heshev. The carpoolers can use the suggested price to negotiate the fee of the ride, from which Google takes a 15% cut.
Should Google eventually decide to take the service to other countries, the model would potentially avoid the legal battles faced by near competitors like Uber, which is mired in disputes with taxi industries around the world. Uber’s director (paywall) of French operations and its director of Western Europe currently face charges for running UberPOP as an illegal taxi service, which could land them multiyear sentences and shut down the country’s UberPOP operations. The arrests follow massive, violent riots by French taxi drivers in June against Uber and other ride-sharing programs. South Korea’s government shut down the Uber app and charged its CEO and other Uber employees for running an illegal tax services, while a German court ruled in March that UberPOP was illegal.
RideWith’s launch in Israel may benefit from potentially lessening an intractable problem: terrible traffic, and sky high car and gas prices. Thanks to high taxes on new cars, high gas prices, and steep auto insurance costs, owning a car in Israel is far more expensive than in the US.
