get on for a ride, page-17

re: get on for a ride tiger My understanding is that Cabcharge installed their eftpos system in conjuction with the NAB. The 10% service fee is then split amongst CAB, NAB, taxi depots and the credit providers who charge CAB their merchant fees. These merchant fees vary according the volume of transactions processed.

For example when CAB bought out Black Cabs (BC) in metro Melbourne, they effectively bought back Cabcharge shares owned by BC, they bought back the % agreement on transaction turnover processed through BC plus BC's income from taxi operators' depot fee charges.

I believe the 2% they are offering taxi drivers/operators comes from the commission that was previously paid to the taxi depots. Once again each depot most probably had different commission rates according to volume of transactions processed.

Cabcharge have been acquiring taxi networks in each major city of Australia which protects their revenue stream.

The only way a major competitor can break this monopoly is to acquire competing taxi networks or pay substantial incentives to existing taxi operators to use alternative terminals for payment.

A classic barrier to entry.