New York Taxis Strike at Uber with a Mobile Hail/Pay Option

The New York taxi system has formally launched a mobile app that allows riders to hail and pay for rides.

Riders can use Verifone's Way2Ride taxi app to press a "hail" button and confirm a pickup location. The cost includes a flat hailing fee, plus the amount on the taxi meter. The payment is automatic when the ride is over.

"During the pilot we found that a lot of New Yorkers prefer a licensed yellow taxi or green cab with a professional driver," said Jason Gross, vice president of strategy and marketing for Verifone. "And we also found that this works in out-of-the-way locations, or at times when it may be hard to find a cab to hail."

The Verifone-powered mobile hailing/payments combination has been in pilot for the past several months. About 14,000 yellow taxis and the green taxis that serve New York's outer boroughs were provided with hailing technology to accompany Verifone's Way2Ride taxi payments app. 

"This is a clear effort to enable traditional taxis to compete with Uber by providing very similar capabilities while still trying to maintain the benefits of a more traditional taxi experience," said Rick Oglesby, head of research for Double Diamond Payments Research. "Additionally, the size of the traditional taxi fleet should provide an advantage versus Uber or other services."

Following its formal introduction of Way2ride in New York City this week, Verifone will roll out its e-hail app in Boston, Miami, Washington, DC, and Las Vegas, and will launch in all U.S. Verifone markets in 2016.

"It’s also a good example of how an innovator such as Uber benefits consumers as well as the whole industry," Oglesby said. "Traditional players don’t give up without a fight, they elevate their game to combat the challenge, which is good for everyone."

Gross did not directly address the car-hailing Uber app, but many of the New York cab features appear to be a direct counter.

For example, there is no "surge pricing," or the higher-fare-based volume that's part of Uber's pricing system, and Verifone's release notes that 100% of the tip goes to the driver, which appears to be a shot at Uber's tipping policy, which has been criticized as difficult to understand.

"We see ourselves as a provider of solutions for the regulated taxi and for higher ride industry," Gross said. "The consumers have demonstrated their desire for a more efficient way to get a ride."

Way2Ride, which is available for both Apple and Android phones, debuted two years ago, and is a major part of Verifone's taxi strategy, which includes advertising and international deployments .