Electronic cab hailing caught on especially fast in China, with its crowded subways, congested highways, and chronic smog that made it unpleasant to walk or bike. But at first, the business didn’t seem like a particularly good one. Competition was fierce, and the taxi-hailing startups had to pay cabbies to help defray the cost of owning cell phones. The Chinese government, worried about any increase in transportation costs, prohibited the startups from collecting commissions on fares and in some cities even ruled the apps illegal – though drivers used them anyway, often carrying spare phones
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