At the start of each new year I like to clarify my thoughts by writing about a few things I think are worth keeping an eye on in the year ahead. They’re not predictions; I’m not a futurist. In previous years I’ve described these as trends, but they’re better thought of as signals. Or, even better, just some things I think are interesting.
I’ve just come back from two weeks in São Paulo, Brazil, visiting friends and family (my wife’s side). I last visited three years ago, and since that time there’s been a clear increase in smartphone use. Brazil’s smartphone penetration is about 40% (of mobile users), and in comparatively wealthy São Paulo it’s likely much higher than the national average. I saw a few ways where the prevalence of smartphones has enabled big behavioural changes in the three years since I last visited; in each case the changes were in fundamentally new services, exposed to users through a mobile app.
As I’m curious, I made a habit of asking people about the services, the apps, and the changes in behaviour, and my observations are written here. They aren’t in any way meant to be comprehensive, or even necessarily to have any conclusions drawn from them. I’ve written this article solely out of interest.
And I want to make clear that I’m not trying to make generalisations about the city as a whole; from a municipal population of some 12 million people, my observations are based on a limited sample of people I met and spent small amounts of time with: mostly middle class friends and family, and working taxi and private hire drivers.
A quick note about the prices in this article: the currency of Brazil is the Real (R$). R$1 is worth about £0.25, or $0.30. Minimum wage is R$880 (£225 / $275) per month. Luxury goods tend to be priced equivalently to Western markets, making them relatively much more expensive.
The most commonly used messaging app, by quite a margin, is WhatsApp (known colloquially as Whats). Everyone I asked uses it. Messenger is also known, but apparently used mainly to reach the few friends you don’t yet have in your WhatsApp contact list.
When I arrived at Guarulhos airport I bought a local SIM. Tech support was provided as a WhatsApp number. Around São Paulo there are all sorts of informal services offered — these range from receiving nude pictures, to small scale witchcraft (love spells, and the like). They’re all organised through WhatsApp.
WhatsApp is so prevalent that it’s included as an incentive in mobile tariffs; for example, the telco Claro are promoting a package offering 600MB of data, but unlimited WhatsApp. For users in a developing country, even in comparatively wealthy São Paulo, free calling is a no-brainer.
There are some 12 million people in the city of São Paulo, and over 4 million cars. Almost half the households in the city commute by car. And, with very few exceptions, all journeys by car involved Waze.
Every taxi or private hire driver used it, and most citizen drivers too. São Paulo is a sprawling city with a chronic traffic problem, and Waze helps drivers find their way, and avoid some of the worst congestion. Waze was seen as better than Google Maps for directions (the few drivers I asked didn’t know that Google own Waze).
One thing taxi drivers didn’t like about Waze is that, in São Paulo, taxis can avoid congestion by using bus lanes at peak times; but Waze doesn’t know that it’s being used in a taxi, so doesn’t recommend those routes. When entering a taxi, the driver would often ask “is it OK if I use Waze?” – letting the passenger give directions if they know a better route, to avoid accusations of ripping off.
Aside: all the taxi drivers were using Android phones, mostly Samsung or Motorola. A popular phone seems to be the Samsung Galaxy J1, which costs R$600 new (or 14 monthly payments of R$60). For comparison, the entry-level iPhone SE starts at around R$2,100.
Uber & 99Taxis
São Paulo’s public transport infrastructure has problems. The metro is formed of four underground lines connecting to a handful of train lines, serving only a small portion of the city. Some of the stations are (or at least, feel) dangerous, with groups of homeless drug addicts sleeping rough and begging for money. Each metro journey costs $3.80.
Many people rely on the bus, although that suffers from a lack of timetable information and signalling at bus stops. It costs the same as the metro, so is comparatively quite expensive. (It also has a reputation for being dangerous.)
There are plenty of taxis, but they’re also quite expensive, starting at R$4.50 plus R$2.75 per km.
Given all of this, it’s not surprising that Uber is very popular among those that can afford it (largely the middle classes). Many journeys that would have been taken by bus, especially, are now taken by Uber instead; when people are sharing a car for a short trip the cost is only a little more than a bus ticket, with the advantage of picking you up and dropping you off wherever you want.
There are a handful of local rivals, of which 99Taxis (usually known as 99) is the best known. 99 began as a free app to connect users with the local taxi companies, before launching a mobile payments platform. It offers taxis at the general lower rate, a 30% discount over the standard street pickup tariff. Recently 99 expanded to include 99POP (private hire drivers) and 99TOP (private hire luxury car drivers). 99POP undercuts the prices of taxis, even with the discount, so some taxi drivers are boycotting the platform and using alternatives.
Many private hire drivers are registered with both Uber and 99 (and sometimes other services too), picking up whichever call arrives first. 99 offers the better deal for drivers, taking only a 15% cut compared to Uber’s 25%. Uber is much easier to sign up to, however; registration can be done entirely through the app, whereas 99 requires drivers to register in person and undergo some testing.
In a country where many people don’t have access to a credit card, both Uber and 99 offer an option to pay for a journey in cash (Uber launched card-only, but later dropped the requirement). This lets more passengers onto the platform, but decreases financial security for drivers; one driver told us that he took a passenger on a ~R$30 trip, only for them to flee on foot when they arrived near the destination.
Another of the advantages for drivers of 99 over Uber is that 99 lets drivers choose to accept requests only from passengers with registered cards. Uber doesn’t permit that option, although apparently will refund drivers for any lost fares through bad payments or criminal action.
Like so much of life in São Paulo, crime is rife with private hire services. Another driver told us that he got called out to a remote address, only to be robbed of his mobile at gunpoint. It seems that criminals steal mobiles from people in the street then use them to call Uber, knowing that at the very least they’ll be able to steal another phone, a wallet, and possibly even a car. Another story we heard, although not first-hand, was that criminals would call UberPOOL and rob all the passengers on board.
All of this criminal behaviour was a risk for taxi drivers before the advent of private hire apps, but the apps have put more drivers on the road and created more opportunities for crime. The positive impact, however, is that two people I spoke to told me that access to services like Uber and 99 has meant that they can get rid of their own cars and still feel able to get around the city easily and safely.