Korea’s Daum Kakao Prepares To Launch Kakao Taxi As Uber Faces Legal Woes

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Like other Asian messaging apps, South Korea’s KakaoTalk is intent on moving beyond being a communications tool to offering a wide selection of services. Today, Daum Kakao, the app’s maker, took the first step in launching a car-calling app called Kakao Taxi by inviting taxi drivers to apply. The feature is expected to be available to riders by the end of March.

When it rolls out, Kakao Taxi will be a formidable rival to Uber. For one thing, it will leverage KakaoTalk’s base of 50 million active monthly users. South Korea is also among the roster of countries where Uber has run into legal issues. In fact, CEO Travis Kalanick was charged with breaking local transportation laws, which could potentially result in a fine or prison sentence, and Seoul has threatened to ban the company, though it is still operating in the city and popular with riders who have trouble hailing a cab during peak hours (video link).

Kakao Taxi also wants to attract the attention of those riders, but it is treading carefully. For one thing, it has already signed agreements with the Seoul Taxi Organization, which represents 225 taxi companies, and subway card maker Korea Smart Card Corp., which is partially owned by the government. This will allow the company to track traffic around the city. Furthermore, the company told TechCrunch that drivers who want to join the service must submit an application for evaluation and will only be issued a license if they pass.

Government approval is especially important for Kakao Taxi because Seoul previously said that it plans to launch its own car-calling app, though that service has yet to debut.

Daum Kakao describes Kakao Taxi as the company’s “first attempt at offering online-to-offline connections.” The car-calling service follow the roll-out of KakaoPay, which lets users pay for e-commerce products and services through the messaging app.

Other messaging apps that are busy transforming themselves into service platforms include Line and WeChat. This gives them an opportunity make more money from their millions of users beyond mobile games, which have been lucrative but are suffering from plateauing revenues.

In China, WeChat users can make mobile payments through the app, while Line has been particularly active in turning itself into a one-stop shop for online services. For example, in Japan, Line users are already able to call taxis and make payments, and in the near future, will also be able to access food delivery and music streaming with their accounts.

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