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Consolidation of Yandex Taxi and Vezet as Competition Issue

Consolidation of Yandex Taxi and Vezet as Competition Issue

28.08.2019
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The American Internet giant Google faces multiple investigations in different countries, including the US, European Union, India, Russia and others for abuse of monopoly position. Meanwhile, in Russia, Google has an influential twin competitor, the Yandex company, which, unlike it, has not yet been severely fined as a result of investigations. 

Yandex Taxi today can rightfully be called a monopolist several markets. The network is developing at the expense of taxi fleets of partner companies. Many companies lost their business independence and turned into an appendage of the monopolist because of the Yandex imposition of Yandex Taximeter software. For taxi parks and drivers, this means a loss of independence in their choice of software hence the ability to work for a company other than Yandex. While technically the driver can be employed by the taxi park, he/she still works on Yandex software, almost everywhere, therefore if the driver were blocked at Yandex, the driver would not be able to work at all.

   Last year, Yandex closed a deal to merge business with Uber, and this year announced the purchase of the Vezet service. The consolidation by Yandex of assets in the Russian taxi market might lead to a lack of a competitive environment and limit the ability of new players to enter it.

According to Ria Novosti, the head of the Federal Antimonopoly Service Igor Artemyev is sceptical of the merger of the Yandex Taxi and Vezet service. "At the end of August we will receive all the databases, and we will look, including what to do with the Yandex Taxi - Vezet deal. I don't feel much enthusiasm for this deal, but we'll see market shares, calculate everything, do everything right," Artemyev said in his interview to RIA Novosti.

If the consolidation of Yandex Taxi and Vezet is supported, the lack of a competitive environment will limit access to the market for new companies and lead to the withdrawal of existing players from the market. The market mechanism for regulating prices for services and taxi rides will be lost. The situation when a large project buys up any serious competitors and strangles the rest is unacceptable. As the Internet becomes an integral part of every person's life, mechanisms must also be created to protect citizens from the arbitrariness of individual private companies.