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LIVE TAXIEPAY PRESS RELEASE 4 AUGUST 2009
You may have heard that the Parent Company of one of our EFTPOS terminal providers, Provenco Cadmus, went into receivership on 3 August 2009.
This has no impact on Live TaxiEpay, its existing customers or potential clients. Live TaxiEpay has sufficient stock to meet the needs of existing and potential customers and according to the Chairman of Provenco Cadmus, it is business as usual.
Live TaxiEpay CEO Tom Varga said “the announcement of the receivership of Provenco Cadmus has no impact on Live TaxiEpay or its customers. Live TaxiEpay will continue to provide the fantastic service and support as well as faster payments to operators that it always has. It is business as usual for Live TaxiEpay”.
Receiver Mr Stiassny said the only company in receivership was the company listed on the stock exchange. Customers and suppliers deal with subsidiaries.
Live TaxiEpay will continue to work with the Australian division of Provenco Cadmus, Cadmus Payment Solutions Pty Ltd, to deliver one of the best EFTPOS terminals in the industry to taxi operators Australia wide.
Any questions should be directed to Live TaxiEpay on 1300 883 703 or email support@livetaxiepay.com.au
The Provenco Cadmus announcement can be found at:
http://www.provenco.com/media/Release.aspx?NewsArticleId=217
http://nz.biz.yahoo.com/090803/3/dohf.html
Anaylysts wary of Cabcharge lawsuit
Article from: The Financial Review, 30 June 2009
Analysts have warned that Cabcharge Australia could face a revenue hit of close to 5 per cent and an even bigger reduction in earnings as a result of the competition regulator’s lawsuit alleging that the taxi fare payments processor has abused its market dominance.
Macquarie Research yesterday joined a group of brokers to warn that Cabcharge’s revenues would be hit if it were forced to share its surcharge with rivals and allow its payment products to be processed through competitors’ terminals. Cabcharge’s shares touched a four-year low yesterday before closing 6 per cent weaker at $5.30. Investors have wiped $127.6 million from the market value of the company since the Australian Competition and Consumer Commission case was lodged in the Federal Court on Friday.
If the court upholds the claimed breaches of sections 45 and 46 of the Trade Practices Act, Cabcharge could face penalties of $10 million per breach.
Citigroup has predicted the regulator’s lawsuit could open up competition in payment services for Cabcharge charge cards. This would prompt market share losses leading to earnings downside of 5 to 10 per cent.
The competition regulator alleges Cabcharge locked out rivals by installing its products for free or below cost, and prevented its payment products from being used by competitors’ terminals.
Industry rivals warn that unless action is taken to level the playing field, Cabcharge will stamp out all competition.
“The reality is, unless drastic action is taken, Cabcharge will be the only supplier of taxi meters left within the country in a relatively short period of time,” said the chief executive of taxi meter manufacturer Schmidt Electronic Laboratories, Gary Schmidt.
“The market is absolutely stuffed. A competitive market of taxi meters in this country is just about finished.”
Mr Schmidt alleges that over a three-year period leading up to December 2007, more than a quarter of the company’s 2300 taxi meters used in Australian taxis were ripped out and replaced with Cabcharge taxi meters.
“There have been so many abuses of so many types over such a long period of time. The reach of Cabcharge through this industry is so pervasive most people would find it absolutely remarkable,” he said. Live Payments chief executive Tom Varga, who provides an alternative payments system, claimed his terminals were also being repeatedly pulled out without any commercial justification from customers.
Asked about his dealings with Cabcharge over recent years, Mr Varga said: “Cabcharge’s level of relationship and entrenchment within the industry means that entering this market has been extremely difficult, and it’s why we’ve seen such fragmented and ineffective competition in this industry.”
Cabcharge spokeswoman Tracey Cain said the company’s lawyers were still reviewing the ACCC’s allegations.
This is not the first time that Cabcharge has been linked to alleged contravention of the Trade Practices Act.
In June 2006, the Australian Competition Tribunal revoked the authorisation to penalise or suspend a driver for failing to display and offer and credit system for payment.
The ruling meant that taxi drivers could choose alternative payment systems from the dominant Cabcharge system, opening taxi payments to competition.
Macquarie said falls in taxi usage may be more worse than expected due to rises in white-collar unemployment and reduced air travel.
The ACCC Takes Action Against Taxi Giant
Article from: qbr.com.au 26 June 2009
The Australian Competition and Consumer Commission has instituted legal proceedings in the Federal Court, Melbourne, against Cabcharge Australia for alleged breaches of the Trade Practices Act.
Cabcharge is a leading supplier of products to the taxi industry including the provision of Cabcharge payment products, processing services for non-cash taxi fare payments, taxi meters, and dispatch and network services.
The ACCC alleges Cabcharge used its market power in the provision of non-cash taxi fare payment processing services and taxi specific payment products to refuse to enter into agreements with competing suppliers of processing services that would have allowed Cabcharge's payment products to be processed through alternative EFTPOS terminals.
The competition watchdog also alleges Cabcharge used its market power to supply a significant number of taxi meters and fare schedule updates either free of charge or below cost for anti-competitive purposes in relation to taxi meters and processing services.
Section 46 of the Act prohibits corporations with a substantial degree of market power from using that power to engage in conduct for certain anti-competitive purposes.
The ACCC further alleges Cabcharge entered into an arrangement with Townsville Taxis to acquire its charge account business and some 130 rival EFTPOS terminals then in use by the taxi network and replace them with Cabcharge EFTPOS terminals.
Section 45 of the Act prohibits corporations from entering into arrangements for the purpose or with the likely effect of substantially lessening competition.
The ACCC is seeking:
- Declarations that Cabcharge's conduct contravened the Act
- Findings of fact
- Pecuniary penalties
- A compliance program
- Costs of the proceeding.
The matter has been listed for directions on July 21 at 9.30am before Justice Finkelstein.
Rival wants 20 pc of taxi market
Article from: The Australian Financial Review
Jane Searle
May 13, 2009
It’s never easy to break a monopoly and Cabcharge Australia’s vicelike crib on the cab payments market is no exception.
However, Live Payments chief executive Tom Varga is optimistic it can gain a 20 per cent share of the $1 billion electronic taxi fare market in the next 12 months despite the obvious challenges facing his business.
Live Payments has this week launched a voucher system in Melbourne that will compete with the familiar blue Cabcharge cards across Australia.
Unlike Cabcharge, which pays commissions to taxi networks, Mr Varga is appealing to drivers with a payment system that rewards them directly.
Mr Varga said a $100 fare paid for by Eftpos incurred a 10 per cent service fee, of which Cabcharge pays about $2.50 to the taxi network.
For the same fare, Live Payments gives $3 to taxi operators, which can be a single taxi driver or someone who controls several drivers.
Taxi networks such as Silver Service Taxis in Sydney and Yellow Cabs in Brisbane have several operators, who pay a network fee for access to radio room bookings for business.
Cabcharge dominates the electronic and voucher payment system, though the competition regulator has been in periodic discussions with industry players to monitor the market.
The battle between the two rivals has already turned ugly with reports that some taxi drivers from Brisbane’s Black and White network have been sacked without explanation for using Live Payments’ system.
In Brisbane, a part-owner of its Yellow Cab network, Neill Ford, is also a Cabcharge shareholder.
These dynamics present a unique hurdle for Live Payments, and Mr Varga conceded that growing its 6 per cent market share would not be easy.
But he pointed to some early gains.
“We have a strong relationship with Cabxpress in Canberra who have embraced our system, and there are some other networks who may not be eligible to receive the full 2.5 per cent from Cabcharge,” he said.
Live Payments was formed by Macquarie Bank in 2006 and deployed in Lime Taxis – an initiative to service disabled people.
Lime Taxis and Live Payments were both bought out by management in 2008.
Live Payments has launched its terminals in cabs nationally over the past 18 months and its vouchers over the past year – a full-service payment offering to rival Cabcharge’s system.
The Melbourne launch of Live Payments this week completes the domestic rollout of its terminal and voucher system.
Drivers will be able to cash in their vouchers at exchange points such as BP service stations, without being charged a commission, in contrast to the Cabcharge system.
Aside from rewarding taxi drivers, Mr Varga said Live Payments’ system improved industry cash flows as its Eftpos system enabled operators to access payments twice weekly, more regularly than Cabcharge.
He said “this helps operators manage their cash flows more efficiently so they don’t have lingering payment issues, although Cabcharge are also improving [their regularity of payment]”.
New choice in taxi payments
Article from: Taxi Talk, May 09
Melbourne’s cabbies welcomed the entry of new competition to their industry as Australian company Live Payments launched its new payment system.
Some 200 drivers enjoyed an all-day barbecue hosted by Live Payments at its head office in West Melbourne.
For the first time, drivers will be able to hand in completed Live Payments vouchers to any participating docket exchanges and receive 100 percent of the value of their fares. Currently, when drivers cash vouchers provided by the market leader – which controls the bulk of the market – exchanges can charge a commission of as much as three percent.
“Live Payments is giving drivers a break by guaranteeing that they can always cash 100 percent of their fares at our authorised exchanges”, Live Payments CEO Tom Varga said.
“For many drivers it’s an opportunity to leave more in their pockets for family expenses at the end of the week”, Mr Varga said. “There are approximately 13, 000 cab drivers in Melbourne and they are a vital part of our transport infrastructure. Our new service represents an alternative for the taxi industry and the drivers stand to benefit”, said Mr Varga.
The drivers themselves were happy to see positive change in their industry and to be shown some appreciation.
“It does show that somebody is at least thinking of us. It’s a long time coming to be honest,” said driver Peter Bottas, 55, of Taylors Lakes.
Live Payments vouchers can be cashed for full face value at participating docket exchanges throughout Melbourne, with even more sites to be added progressively. The vouchers will provide drivers with flexibility as they also can be exchanged for discounted fuel and other purchases at 48 participating BP service stations.