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Ola seeks to expand video content service, add more electric vehicles to its fleet

LiveMint logoLiveMint 29-05-2017 Mihir Dalal

Bengaluru/New Delhi: Cab-hailing app Ola is expanding Ola Play, a content platform, as well as its nascent electric vehicle business to differentiate its services from Uber, three people familiar with the matter said.

Ola (ANI Technologies Pvt. Ltd) launched Ola Play on some of its Prime cabs in Delhi, Bengaluru and Mumbai last November and later expanded the platform to all of its Prime fleet in the three cities.

Ola Play, which is available on tablets installed in the Prime cabs, offers music, shopping apps, movies and other video content to customers and also lets them control air-conditioning.

The company is betting that Play’s unique experience will attract a large number of customers and keep them away from Uber. Cab-users typically choose between Ola and Uber depending on which offers the lower prices.

Ola wants to gradually charge customers slightly more for using Play, the people cited above said, speaking on condition of anonymity. As it expands Play to more cabs, Ola also plans to generate revenues by serving ads on the platform, the people said.

The other big initiative this year at Ola is its electric vehicle business. The company plans to introduce electric cabs and rickshaws in at least eight cities by next March, the people cited above said. It may add electric bikes later to the fleet, they said. These initiatives will be funded by SoftBank Group Corp., Ola’s largest investor, the Indian government, car and bike makers and Ola, they said.

Ola launched electric vehicles in Nagpur last Friday with 100 e-taxis and as many e-rickshaws sourced from companies including Mahindra Group, Tata Motors Ltd, Kinetic Engineering Ltd and TVS Motor Company.

Ola CEO Bhavish Aggarwal told reporters then that Ola had invested Rs50 crore in the Nagpur initiative and planned to invest $2 billion to run one million electric vehicles across India by 2020. It’s not clear how Ola plans to raise the $2 billion.

Technology news platform FactorDaily reported Monday that Ola plans to become an electric vehicle maker though Mint could not confirm this.

Ola is also investing in charging stations to support its push into electric vehicles, the people mentioned above said. Electric cars can cover about 150km on a single charge, which works well for smaller cities including Nagpur. But the company will need a far greater number of charging stations in bigger cities like Delhi and Bengaluru.

In December, SoftBank chairman Masayoshi Son had said Ola may introduce a fleet of one million electric cars in partnership with an electric vehicle maker and the government.

It’s important for Ola to make its Play and electric vehicle initiatives work as they are ways to help it build a customer base different from that of Uber. Ola is fighting an expensive market share battle with Uber, the world’s largest and richest start-up. While Ola and Uber differ on who controls how much of the market, data from some research firms indicates that the two are running very close to each other.

But both the Ola Play and the electric vehicle initiatives represent so-called moonshot bets by Ola. The company faces steep challenges in expanding the two initiatives.

Ola Play aims to change the way people consume technology—people typically use phones to read or watch content, especially when they’re on the move. Ola is hoping that fast Internet speed, premium content and high-definition delivery on Play will prompt customers to take to the tablets and pay extra. Attracting advertisers online is particularly tough in India, as several media, retail and other platforms have discovered.

“Ola needs to have something different from Uber. Play and Electric are very ambitious projects and unlikely to become big very fast but they are attempts to do that,” one of the people cited above said.

Ola did not respond to an email seeking comment.

mihir.d@livemint.com

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