Sustainability 12 01883

sustainability
Article
Business Model, Open Innovation, and Sustainability
in Car Sharing Industry—Comparing
Three Economies
JinHyo Joseph Yun 1, * , Xiaofei Zhao 1 , Jinxi Wu 2 , John C. Yi 3 , KyungBae Park 4 and
WooYoung Jung 1
1 Department of Open Innovation and Business Model, Open Innovation Academy of SOItmC, and DGIST,
Daegu 42988, Korea; qiaoke@dgist.ac.kr (X.Z.); wyjung@dgist.ac.kr (W.J.)
2 School of Social Sciences, Tsinghua University, Beijing 100084, China; wujx02@mail.tsinghua.edu.cn
3 Haub School of Business, Saint Joseph’s University, Philadelphia, PA 19131, USA; john.yi@sju.edu
4 Department of Business Administration, Sangji University, Wonju 26339, Korea; kbpark@sangji.ac.kr
* Correspondence: jhyun@dgist.ac.kr

Received: 8 January 2020; Accepted: 27 February 2020; Published: 2 March 2020
Abstract: This paper discusses dynamics and differences of business models in the car-sharing
industry and focuses on open innovation as the trigger of diverse business models among Uber in the
U.S., DiDi Chuxing in China, and KakaoT in Korea. We seek to answer the following two questions:
What creates the differences in the business models of the car-sharing industry? Do the differences in
open innovation motivate the diversity of business models among Uber, DiDi Chuxing, and KakaoT?
We incorporated participatory observation, interviews, and semi-structured questionnaire methods
in our study. We used two-step participatory observation and interview methods, hence carrying
out observation and interviews two times by different researchers with Uber drivers in the U.S.,
DiDi-Chuxing drivers in Beijing, and KakaoT taxi drivers in Korea to confirm the interview and
participatory observation results. First, business models of the car-sharing firms Uber, DiDi-Chuxing,
and KakaoT are not fixed but rather are dynamically changing. Second, business models of car-sharing
firms are the result of interaction with government regulations, the taxi industry, public transportation,
and the automotive car industry. Third, open innovation strategies of car-sharing firms determine
the contents and dynamics of car-sharing business models, such as the revenue business model,
responsibility business model, and system business model upon interaction with four agencies.
Keywords: car-sharing industry; open innovation; business model; Uber; DiDi-Chexing; KakaoT
1. Introduction
While the 20th century saw the beginning of the individual ownership era of the car, the sharing
economy has arrived in the 21st century with diverse car-sharing models even though there are
possibilities of the existence of digital divide and the socially unequal availability of the rede sharing
initiatives [1,2]. Today, in the U.S., anybody can call a sharing car, identify the location of the car on a
cyber map, pay without a card in hand, and evaluate the level of the sharing car driver from one to five
stars [3]. If we have apps for car-sharing right now, we can live comfortably in the U.S., where the
individual car ownership era started 100 years ago, without owning a car.
The sharing economy is exchanging the traditional manufacturing industry for a new service
industry—the car-sharing industry. In this new service industry, the traditional factors of a service
industry, such as the difference between individual entrepreneurs and individual owners, the business
process of an entrepreneurial service firm, the financial resources motivation problem, etc., may be
treated totally differently from the perspective of an open innovation platform [4–6]. For example,
Sustainability 2020, 12, 1883; doi:10.3390/su12051883 www.mdpi.com/journal/sustainability

Sustainability 2020, 12, 1883 2 of 27
franchise factors, such as trust, partnership, or the relationship between franchiser and franchisee,
should be changed as open innovation, platform trust, data safety, etc., in the open innovation platforms
of a sharing economy, such as Uber, Appstore, or Airbnb [7–10].
There are presently diverse different car-sharing business models in the world, including business
to consumer (B2C) models, such as Zipcar and Car2Go, SOCAR, peer-to-peer (P2P) models, such
as RelayRides, SnappCar, Getaround, and Drivy, short distance carpooling models, such as Lyft,
Uber, SideCar, DiDi-Chuxing, KakaoT, and Grab, and long distance carpooling models, such as
Carpooling.com, BlaBlaCar, and GoCarShare, as well as other ride sharing models, such as Coot
Networks, Spinlister, and Boatbound [11,12].
This paper discusses the dynamics and differences of business models in the car-sharing industry
and focuses on open innovation as the trigger of the diverse business models among Uber in the U.S.,
DiDi Chuxing in China, and KakaoT in Korea.
1.1. Research Questions

The main research question is as follows: What causes the differences in business models in the
car-sharing industry? We additionally posed two detailed research questions: Does the difference in
open innovation motivate the diversity of business models among Uber, DiDi Chuxing, and KakaoT?
If so, what were the differences in open innovation and business models among Uber, Didi Chuxing,
and KakaoT?
1.2. Research Scope

We used participatory observation, deep interviews, and a case study. In addition, we used
literature reviews to validate the interview results. Through this kinds of qualitative research, we
analyzed data from direct fieldwork observations, in-depth, open-ended interviews, and written
documents, allowing us to arrive at more meaningful conclusions than in quantitative research in
the case of a new industry analysis, such as car-sharing [13,14]. Participatory research including
participatory observation breaks the linear mode of conventional research and focuses on a process
of sequential reflection and action [15]. Furthermore, participatory observation, with the purpose to
enable action at some level, emphasizes the research [16]. However, our participatory observation
on the driving of a shared car was limited in terms of action because we interviewed the sharing car
drivers with a semi-structured questionnaire. That is, we mixed participatory observation, interview,
and questionnaire methods in our study [17]. Researchers in this study acted as participants at the
outside of the target group, so to say sharing car drivers to experience under study, watch, and take
field notes from a distance [18].
2. Literature Reviews and Research Framework
2.1. Literature Reviews

According to research in Korea, carpooling services have a significant socioeconomic cost-savings
effect on traffic congestion, environmental cost reduction, and so forth, and will therefore play an
important role in traffic demand management [19]. In China, the user community of an e-hailing
platform enterprise, Didi-Chuxing, has grown larger than the size of the traditional taxi user community.
This has motivated the success of this car-sharing economy business model in China with an increasing
difficulty to control this market by the government [20]. Access or sharing-based consumption, defined
as transactions that can be market-mediated, but where no transfer of ownership takes place, is
becoming increasingly popular, but nonetheless is not well researched or theorized [21]. Even in the
car-sharing industry, there is considerable diversity between, for example, Zipcar, which is based
on an access base, and Uber, which conducts sharing very differently. In addition, the car-sharing
industry has changed dynamically from the Car-Sharing Portland (CPS), which was the first car-sharing
organization in the U.S., to Uber today, and is being treated as a new approach to today’s urban
transportation problems [22].
In Europe, the early adopters of the car-sharing with the increase of information sharing devices
in urban mobility have been largely motivated by diverse reasons such as environmental concerns
and financial savings including excessive time for public transport, residential parking problems,
major changes in the personal lives or mobility situations, or rising insurance costs or a lack of
funds, to replace a vehicle [2,22]. The new floating car-sharing systems, such as Car2Go, can have
environmental, social, and economic effects altogether, even though the effects can differ according
to city characteristics or technological development [23]. It should also be noted that, until 2000, the
car-sharing service was focused on addressing environmental issues, such as changing consumer
behavior through eco-efficient services, environment friendly identity-promoting of car-sharing service
users, or emissions reduction with car ownership reduction [24–26]. However, the development of
professional car-sharing by environmentally concerned citizens did not remain but instead shifted to
user-led innovation processes with additional market value with more attractive technologies, such as
relocation algorithms for free-floating car-sharing systems [27,28]. The consumption of sharing and
collaborative services, such as Airbnb, Zipcar, and Freecycle, is skyrocketing with their reliance on
the internet, especially web 2.0. Web 2.0 collectively refers to websites that allow users to contribute
content and connect with each other in the 21st century [29,30]. Zipcar is different from car-sharing
organizations in the 20th century to the extent that it is a commercial car-sharing organization with
a fleet of automobiles in North America and some European cities. Similar examples include Uber,
DiDi-Chuxing, and KakaoT. The sharing economy now includes both social (relational, communitarian)
and economic (allocative, profit-seeking) aspects that appear to be in tension [31]. The sharing economy
thus lacks a shared definition so far, and some have argued that the sharing economy is not about
sharing at all [32,33].
It should also be noted that, as car-sharing moves from an environmentally friendly lifestyle to a
new kind of business, sharing economy firms such as Uber, Didi Chuxing, and KakaoT are disrupting
traditional industries across the globe, for example, Airbnb in the hotel industry and Uber in the taxi
industry [34]. The sharing economy thus has attracted a great deal of attention recently, and platforms
such as Airbnb and Uber are experiencing explosive growth, which in turn has led to regulatory
and political battles [35]. In many countries, regulation is often the most significant barrier to future
growth of the sharing economy, which encompasses four broad categories: recirculation of goods,
increased utilization of durable assets, exchange of services, and sharing of productive assets [34,35].
For example, the taxi industry of Shenzhen, China, which has a sufficient population for the taxi
industry, is in serious danger with the growth of e-hailing and ride-sourcing by DiDi-Chuxing [36].
The interests of sharing economy firms and city governments are often aligned, but the failure to
engage with potential regulators early on can raise the suspicion that companies are trying to exploit
loopholes rather than develop a legitimate business model [37].
As information technology (IT) is spreading across industries in the fourth industrial revolution,
new business models that challenge traditional business strategies emerge, namely, open innovation
and open business models, which are the core of sharing economy firms, such as Airbnb, Uber, and
others [38–40]. In a sharing economy, people, organizations, and communities as active participants
produce or co-produce goods and services collaboratively or co-operatively, and sharing economy firms
mainly pursue open innovation strategies and open business models [41]. Business models of a sharing
economy are also fundamentally linked with technological innovation to the extent that business
models mediate the link between technology and firm performance by openness and user engagement,
which are known as open innovation business models [42]. The sharing economy can be used as an
umbrella term for gig economy, on-demand service, and collaborative consumption and is based on the
second IT revolution in the fourth industrial revolution [43]. The sharing economy has many diverse
business models in four dimensions: technology, such as tech-driven, tech-enabled, and low/no-tech;
transaction, such as market, alternative, and free; business approach, such as profit-driven, hybrid, and
mission-driven; shared resources, such as new resources, used resources, and under-utilized existing
resources; and a governance model, ranging from traditional corporate structures to collaborative
governance models [44]. Business models in the sharing economy share the following five factors:
(1) largely market-based; (2) high-impact capital based platform; (3) crowd-based networks rather than
centralized institutions or hierarchies; (4) blurring lines between the personal and the professional; and
(5) blurring lines between fully employed and causal labor, which has a new kind of relationship of
digital trust [12]. Most business models in the sharing economy can be evaluated as open innovation
business models because a sharing economy means a crowd-based economy [12].
2.2. Research Method, and Research Framework

First, we carried out participatory observations and deep interviews with KakaoT taxi drivers in
Seoul and Daegu, the first and third largest metropolitan cities in Korea, from 2 June to 5 August, 2018,
with the semi-structured questionnaire provided in Appendix A and from 1st to 7th in Appendix B.
In addition, we interviewed KakaoT taxi drivers in Wonju, a small city in Korea, from 27 November
to 27 December, 2018 from 8th to 17th in Appendix B. These second interviews and the participatory
observation were conducted by the Sangji University research team to confirm or validate the first
interviews, and the participatory observation was conducted by the Daegu Gyeongbuk Institute of
Science and Technology (DGIST) research team. In addition, for three drivers, we only included the
conducted participatory observation as they declined being interviewed.
Second, we interviewed 13 Uber drivers from 1st to 13th in Appendix C in San Francisco on
17–23 August, 2018, with the semi-structured questionnaire presented in Appendix A. In addition,
we interviewed six Uber drivers in West Philadelphia, near St. Joseph University during September
2018–February 2019. These six interviewees are listed in Appendix C from 14th to 19th. The second
interviews were conducted by the St. Joseph University team to confirm or validate the interviews and
participatory observation, seeing results were obtained by the DGIST research team of Korea.
Third, we interviewed 14 DiDi-Chuxing drivers in Beijing from 17 August to 23 August, 2018, with
the same semi-structured questionnaire presented Appendices A and D. In addition, we carried out
participatory observation and interviews of 10 DiDi-Chuxing drivers in Beijing in December 2018 to
confirm the deep interview results from 15th to 24th in Appendix D. These additional interviews were
conducted by the Tsinghua University research team to validate the first interviews and participatory
results from the DGIST research team.
According to national strategy reports for 2025, open innovation is selected as a creative approach
for the sharing economy in China. Government regulation structures often discourage such sharing
economy innovations, reducing their popularity and slowing their development [45]. It should be
noted that taxi drivers have cast Uber as an unsafe and rapacious competitor because it is a creative
destruction actor at work, leading lawmakers to shut it out of various markets [46]. Many critics point
out to consider who benefits from the sharing economy because the peer-to-peer economy or the gig
economy does not benefit workers who are not working in the sharing industry but rather in the taxi
industry or automotive industry [47]. However, the representative motivation of car-sharing such as
lower carbon footprints has negative effects on the automotive industry because this industry will not
grow in tandem as car-sharing is about economic self-interest rather than sharing and is predatory
and exploitative [36]. In addition, competing industries or supporting industries of the car-sharing
industry, such as public transportation, including buses and car parking systems, will have effects on
the open innovation of car-sharing and the developing of business models of the car-sharing industry
in addition to new regulations and customer protection from the non-balance of information, the vague
distinction between private area and working area, and new social safety network requirements [12].
We want to analyze the car-sharing business model and open innovation of three firms in three
countries based on the research framework in Figure 1. We selected four factors that affect the
car-sharing industry open innovation, such as taxi industry, public transportation with parking,
automotive industry, and government regulation. One reason we selected public transport here is that
ridesharing may have overall negative consequences for a city in several aspects such as promoting the
shift from public transport to shared cars or an increase in vehicle kilometers travelled [48].
Sustainability 2020, 1, x FOR PEER REVIEW 5 of 30
Figure 1. Research framework—car-sharing business model dynamics.
If you highlight this study, the

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3. Business Model and Open Innovation of Uber
3. Business Model and Open Innovation of Uber
3.1. Revenue Business Model of Uber and Open Innovation
3.1. Revenue
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one Uber X driver receives 75% of customer payment,
receiving it as his salary from Uber once per week. An Uber Black driver also receives 75% of customer
First, in regards to the revenue model, one Uber X driver receives 75% of customer payment,
payment. However, an Uber SUV driver receives 72% of customer payment every Thursday from Uber.
receiving it as his salary from Uber once per week. An Uber Black driver also receives 75% of
An Uber-Select driver receives 70% of customer payment (Uber takes 20%–30% of the driver’s revenue
customer payment. However, an Uber SUV driver receives 72% of customer payment every Thursday
according to their website, but there are two charges that go directly to Uber: “booking fee” and “safe
from Uber. An Uber-Select driver receives 70% of customer payment (Uber takes 20%–30% of the
ride fee” (around $3 total). In short, with rides of five miles or less, the Uber driver cannot make more
driver’s revenue according to their website, but there are two charges that go directly to Uber:
than $10 per ride. This was learned from additional interviews on 14th–19th in Appendix C. Moreover,
“booking fee” and “safe ride fee” (around $3 total). In short, with rides of five miles or less, the Uber
Uber drivers receive $3 for each delivery for Uber-Eat. However, in some motivation events, Uber
driver cannot make more than $10 per ride. This was learned from additional interviews on 14th–
drivers sometime receive $100 for a delivery for Uber-Eat.
19th in Appendix C. Moreover, Uber drivers receive $3 for each delivery for Uber-Eat. However, in
some motivation events, Uber drivers sometime receive $100 for a delivery for Uber-Eat.
Uber call payment increases with both distance and time, but distance has a greater effect on
increasing the Uber fee than time has for each situation. However, if any Uber driver receives a call
at any place where there are many calls from customers at a busy time, the fee increases dramatically.
Therefore, there are large differences between Uber drivers in revenues according to the familiarity
Uber call payment increases with both distance and time, but distance has a greater effect on
increasing the Uber fee than time has for each situation. However, if any Uber driver receives a call at
any place where
Sustainability 2020, 1, xthere are many
FOR PEER REVIEWcalls from customers at a busy time, the fee increases dramatically. 6 of 30
Therefore, there are large differences between Uber drivers in revenues according to the familiarity
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Figure 2. Business model and open innovation of Uber.

Uber. Source: authors’ own.
3.2. Responsibility Business

3.2. Responsibility Business Model
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ⓒ need to have a four-door vehicle that is ≤ 10 years old and in good condition (in Philadelphia ≤ 15
years old vehicle), ⓓ no vans, box trucks, taxi cabs, government cars, or rebuilt vehicles, ⓔ in-state
auto insurance, ⓕ pass vehicle inspection (working seat belts), ⓖ in-state driver license, ⓗ proof of
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Sustainability 2020, 1, x FOR PEER REVIEW vans,
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customer later.
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If anybody wants to become an Uber driver, the candidate should provide an identity card (ID),
customer later.
health reports, criminal record, car information, insurance for the car, a financial credit report, and
If anybody wants to become an Uber driver, the candidate should provide an identity card (ID),
driver license, and should await the results for three weeks. Uber gives the first candidate a one-year
health reports, criminal record, car information, insurance for the car, a financial credit report, and
Uber license and checks the driver again after one year. According to Uber drivers’ self-evaluation,
driver license, and should await the results for three weeks. Uber gives the first candidate a one-year
they, in addition, have usually two or more jobs. The ratio of women among all Uber driver was
Uber license and checks the driver again after one year. According to Uber drivers’ self-evaluation,
almost 5%. The female Uber drivers said that they did not feel any danger in driving an Uber car. Uber
they, in addition, have usually two or more jobs. The ratio of women among all Uber driver was
drivers can choose to reject any customer if the driver feels unsafe, such as in the case of not having a
almost 5%. The female Uber drivers said that they did not feel any danger in driving an Uber car.
baby seat when the customer has a baby.
Uber drivers can choose to reject any customer if the driver feels unsafe, such as in the case of not
Most of all, the safety requirement from the government regulation let Uber to set up individual
having a baby seat when the customer has a baby.
commercial insurance and a commercial driver license for Uber drivers [53]. An additional requirement
Most of all, the safety requirement from the government regulation let Uber to set up individual
from the public transportation agencies and firms induced Uber to set up Uber insurance for Uber
commercial insurance and a commercial driver license for Uber drivers [53]. An additional
customers during riding Uber except when riding in a premium Uber car. In the next step, Uber should
requirement from the public transportation agencies and firms induced Uber to set up Uber insurance
prepare a safety system for Uber cars and drivers. Although an appropriate and related system for
for Uber customers during riding Uber except when riding in a premium Uber car. In the next step,
Uber drivers to reject any customer if he or she feels danger from the customer was controversial
Uber should prepare a safety system for Uber cars and drivers. Although an appropriate and related
because of the possibility of racism, it was accepted into the Uber system because of the high safety
system for Uber drivers to reject any customer if he or she feels danger from the customer was
requirement for Uber drivers by government regulations, the current conditions of the taxi industry,
controversial because of the possibility of racism, it was accepted into the Uber system because of the
and the high standard of safety of public transportation (Figure 2).
high safety requirement for Uber drivers by government regulations, the current conditions of the
taxi
3.3.industry, and theModel
System Business high standard
and Openof safety of of
Innovation public
Uber transportation (Figure 2).
UberBusiness
3.3. System provides diverse
Model system
and Open models of
Innovation that connect the customer and Uber driver through a
Uber
technological platform. An Uber-Pool driver cannot reject additional customers at the system even
Uber provides diverse system models that connect the customer and Uber driver through a
if there is not additional revenue for the driver to carry more customers in the Uber Pool driving.
technological platform. An Uber-Pool driver cannot reject additional customers at the system even if
In addition, Uber has two different customer allocation systems. The first is, Uber allocates customers
there is not additional revenue for the driver to carry more customers in the Uber Pool driving. In
according to the destination where the Uber driver has registered in advance. The other is that the
addition, Uber has two different customer allocation systems. The first is, Uber allocates customers
Uber system allocates customers to the nearest Uber driver. Basically, the Uber system allocates calls to
according to the destination where the Uber driver has registered in advance. The other is that the
Uber drivers. However, Uber drivers can cancel the allocation by the Uber system. However, when
Uber system allocates customers to the nearest Uber driver. Basically, the Uber system allocates calls
the Uber driver goes home, a call allocation requirement coinciding with the homeward direction is
to Uber drivers. However, Uber drivers can cancel the allocation by the Uber system. However, when
the Uber driver goes home, a call allocation requirement coinciding with the homeward direction is
possible. In addition, before the Uber driver arrives at any destination, a new Uber call allocation is
possible. For example, when we went to a shopping center near Stanford University, the Uber driver
received the next Uber call allocation during driving with us, now customers. If Uber drivers are at
places where there are not many Uber cars, the in-advance Uber call allocation system during driving
possible. In addition, before the Uber driver arrives at any destination, a new Uber call allocation is
possible. For example, when we went to a shopping center near Stanford University, the Uber driver
received the next Uber call allocation during driving with us, now customers. If Uber drivers are at
places where there are not many Uber cars, the in-advance Uber call allocation system during driving
other Uber calls is apt to answer the Uber customer early.
Uber customers normally pay the fee in advance with a registered credit card. In addition, the
Uber customer’s information is unknown to the driver before leaving the car. The Uber customer can
pay tips additionally. In the Uber payment system, long-distance driving is not advantageous for the
Uber driver because the distance is not accurately included in the calculation of the fee according to the
answers or attitude of Uber drivers. In the case of Uber-Pool and Uber-X, the in-advance proposed fee
does not change after the Uber car arrives at the destination. Uber pays the received Uber fee through
a card system to the Uber driver in diverse ways, ranging from daily payment for early registered
long-serving Uber drivers to 3–4 days at a time, and one time per week on fixed days in addition to a
one-time payment roughly once a month. That is, Uber pays money to Uber drivers in very diverse
ways according to the driver’s situations, such as the career of the Uber driver, one day average driving
time of the Uber driver, the frequency of Uber driving in one week, or the amount of Uber customers
for the Uber driver.
What is important is that Uber drivers cannot know the destination of the called customer before
the call is accepted and the Uber car takes in the customer. Uber drivers can reject Uber-pool in advance.
However, if the Uber driver accepts Uber-pool, the driver can use fast roads that were indicated to the
car when they have more than two customers, which is very important for fast driving in San Francisco.
According to female Uber drivers in the San Francisco region, Uber was allocating 70% Uber-pool and
30% Uber-X to female Uber drivers. In case of Uber-pool drivers having customers in many places at
the same driving courses, the fee increases. An Uber-pool system like this was a special Uber allocation
system that was just being used in limited metropolitan cities, such as San Francisco, New York, and
Los Angeles in the U.S., according to an Uber driver in San Francisco.
Weak public transportation systems, high customer privacy by public regulations, and
differentiation from taxis in paying system requirements of the taxi industry allow Uber not to
show the destination to the driver and keep the driving information confidential, as well as a diverse
Uber payment system according to individual to the Uber driver (Figure 2).
4. Business Model and Open Innovation of DiDi-Chuxing
4.1. Revenue Business Model and Open Innovation of DiDi-Chuxing

DiDi-X drivers receive 80% of revenues that the customer paid to DiDi-Chuxing. DiDi drivers can
drive the DiDi car for 12 hours per day, and the 12 hours are calculated from the DiDi operating time.
DiDi-Premier drivers receive 74% of revenues. The fee of DiDi-Premier is 20% higher than DiDi-X,
and the former earns 20% more than DiDi-X drivers. The fee of DiDi-Luxury is five times higher than
that of DiDi-X, and three times more expensive than DiDi-Premier. The total number of DiDi-Luxury
cars is just 200, and 75% are owned by DiDi-Chuxing itself and 25% by individuals, according to the
DiDi drivers our research team interviewed. A DiDi-Luxury driver is supposed to upload six photos
every morning before driving. DiDi owned luxury car drivers earn 10,000 yuan for one month with a
one-time and weekly payment from DiDi-Chuxing. The fee of DiDi-Pool is 10% lower than the fee
of DiDi-X. However, DiDi drivers do not mind choosing DiDi-Pool because the customer number of
DiDi-Pool increases and the income of the DiDi driver also increases.
According to the interviews with DiDi drivers, if the distance of DiDi driving increases, the
revenue of DiDi-Chuxing increases. If customers pay through Alipay, Alipay gives a small incentive to
the drivers as a kind of Alipay promotion in DiDi-Chuxing. If a DiDi driver cancels the allocation
more than four times, the driver pays some amount to DiDi-Chuxing. Among DiDi, only DiDi-Luxury
can be booked in advance.
If DiDi customers cancel with a reason, the DiDi driver cannot receive compensation money from
DiDi-Chuxing even though there are 1–2 times customer cancellations per day. However, in the case of
cancellation with no reason by the customer, DiDi-Chuxing pays per 1 km 1 CNY to the DiDi driver.
Notably, DiDi-Chuxing gives compensation money of 108 CNY to DiDi drivers for long-distance routes
according
Sustainability to the1,requirement
2020, of the customer. DiDi-taxi drivers do not pay money to DiDi-Chuxing,
x FOR PEER REVIEW 9 of 30
even though among the one-month revenue of 8200 CNY, 3000 CNY is from DiDi calls according to
our
eightinterviews.
hours per Moreover, DiDi-X to
month according drivers are required
DiDi-Chuxing. to drive DiDi
DiDi-Luxury canforadditionally
at least eight hours per
increase themonth
fee by
according
0.1% at peak to DiDi-Chuxing.
times. DiDi-Luxury can additionally increase the fee by 0.1% at peak times.
What isisimportant
importantis is thatthat
the the revenue
revenue of drivers
of DiDi DiDi drivers
is more isthanmoretwo than
timestwo times the
the university-
university-graduated manpower salary at minimum under the weakness
graduated manpower salary at minimum under the weakness of the taxi industry in China and the of the taxi industry in
China and the
automotive automotive
industry withindustry with the
the support support
of the of thegovernment
Chinese Chinese government
with a weakwith regulation
a weak regulation
power
power
(Figure(Figure
3). Many 3). taxi
Many taxi drivers
drivers who have who have
cars andcars
areand are in
in good good condition
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drivers moved
moved
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from occupation
their occupation
as a as a taxi
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driver. DiDi-Chuxing
DiDi-Chuxing is is beingtreated
being treatedby by the
the Chinese
government
government as asaakind
kindofofpeople’s
people’srevenue
revenueincreasing
increasingengine according
engine accordingto the
to deep interviews
the deep with DiDi
interviews with
drivers (Figure 3). Several DiDi drivers really moved to DiDi driving after losing
DiDi drivers (Figure 3). Several DiDi drivers really moved to DiDi driving after losing their job their job according to
our interviews.
according to our interviews.
Figure 3.
Figure 3. Business
Business model
model and
and open
open innovation
innovation of
of DiDi-Chuxing.
DiDi-Chuxing. Source:
Source: authors’
authors’ own.
own.
4.2. Responsibility Business

4.2. Responsibility Business Model
Model and
and Open
Open Innovation
Innovation of
of DiDi-Chuxing
DiDi-Chuxing
DiDi
DiDi drivers,
drivers, without
without exception, are supposed
exception, are supposed to
to cover
cover all
all DiDi-Car
DiDi-Car insurances
insurances and and accidents
accidents
during
during DiDi
DiDi driving
driving by
by their
their own insurance. DiDi-Premier
own insurance. DiDi-Premier drivers
drivers are
are supposed
supposed toto prepare
prepare aptapt cars,
cars,
pass
pass an examination and interview, dress up in required attire when driving, and upload photos of
an examination and interview, dress up in required attire when driving, and upload photos of
themselves
themselves and
and the
the car’s
car’s condition
condition before
before driving. DiDi-Luxury drivers
driving. DiDi-Luxury drivers must
must fulfill
fulfill the
the following
following
conditions: good appearance;
conditions: good appearance; atat least
least high
high school
school or
or university
university graduation; five years
graduation; five years ofof driving
driving
experience; a luxury car, such as an Audi A6 or higher, BMW 5 or higher, Mercedes-Benz E or higher;
upload six photos every day (According to additional interviews in Beijing, the DiDi drivers are
additionally required the following: possess a local licensed vehicle, price of the car over 70,000 CNY,
and age of the car less than 8 years; have C1 or above driving license, and driving experience of more
than three years. This was learned from additional interviews on 15th–24th in Appendix D).
experience; a luxury car, such as an Audi A6 or higher, BMW 5 or higher, Mercedes-Benz E or higher;
upload six photos every day (According to additional interviews in Beijing, the DiDi drivers are
additionally required the following: possess a local licensed vehicle, price of the car over 70,000 CNY,
and age of the car less than 8 years; have C1 or above driving license, and driving experience of more
than three years. This was learned from additional interviews on 15th–24th in Appendix D).
Notably, DiDi drivers cannot reject customers who carry pet animals without any protection
condition according to DiDi driver interviews. Even though it is not covered by the insurance,
DiDi-Chuxing announced that it will cover all criminal damages to customers when using DiDi-Chuxing.
DiDi customers prefer DiDi-X over DiDi-Pool because they feel that DiDi-X is safer than DiDi-pool
even though it is a little more expensive than DiDi-pool.
DiDi drivers are required to have a driver’s license, individual insurance, be under 55, a clean
criminal record, and no tattoos. However, DiDi-Chuxing does not require a health check of the DiDi
driver. During our interviews, we witnessed a case which differed between DiDi drivers in the platform
and actual DiDi drivers of the car. We felt danger and canceled the booking. The DiDi driver should
have stopped driving during high-traffic time. DiDi-Chuxing followed up with the customer and
gathered customer information for customer safety. However, in the case of long-distance driving,
many DiDi-drivers did not want to drive, and several times they required customers to cancel the calls
in our interviews and experience, as there is no system that confirms any customer can come back in
the same car.
In Beijing, DiDi-Chuxing started as a booking service for taxis, moved to car-sharing booking
without a high complaint from the taxi industry, and received permission from the Beijing government,
which has weak regulations on the sharing economy (Figure 3). In China, automotive complaints
against DiDi-Chuxing were also weak because DiDi-Chuxing lets people buy cars to use on their own
as well as for car-sharing. In DiDi-Chuxing, the responsibility of the DiDi driver is high regarding
insurance, dress code, and car requirement because of the weak regulations of the government and the
weak power of the taxi industry.
4.3. System Business Model and Open Innovation of DiDi-Chuxing

DiDi-Chuxing basically allocates calls from customers within 3 km, although the allocation
boundary is being widened now. However, recently, DiDi-Chuxing added a destination basic allocation
system in which DiDi drivers can announce a destination place and escaping place. DiDi-Chuxing
allocating systems have two modes: the selection mode, which started in July 2018, allows the DiDi
driver to select the destination, including long distance; the allocation mode allocates calls to DiDi
drivers nearby. If a DiDi driver cancels the calls, stars which indicate the level of the DiDi driver
decrease. DiDi-Chuxing tends to allocate DiDi-X to veterans and DiDi-pool to the beginning drivers
according to our interviews.
DiDi customers use payment methods such as Wechat-Pay, AliPay, DiDi-Pay, and so on.
DiDi customers can change the payment methods when they pay for any DiDi-Chuxing usage.
The DiDi-Chuxing car-sharing fee moves from the customer to DiDi upon being sent by the customer.
If the customer did not pay, he is supposed to pay the fee before next using DiDi-Chuxing. In the
case of long-distance driving in Beijing, the DiDi system raises the fee up to 30% to cover the financial
damage to the DiDi driver.
In the case of DiDi-Premier, there are differences between the in-advance announced payment
amount and the real payment amount after driving. However, there were nearly small differences
in these two amounts. The money may be paid a little late after driving even though the customer’s
money is directly allocated to the driver’s bank account. More specifically, actual payment occurs two
days after the customer’s payment, or a one-time weekly payment is made. DiDi-Premier currently
receives a distance fee, low-speed fee, and long-distance fee. DiDi-Luxury receives a long-distance
basic fee and fast call allocation fee additionally. DiDi-Chuxing has a 3 km base call allocation system
with a trend toward expansion of the allocation distance from over 3 km up to 10 km in the case
of DiDi-Luxury because of weak government regulations and medium-level public transportation

conditions (Figure 3).
5. Business Model and Open Innovation of KakaoT
5.1. Revenue Business Model and Open Innovation of KakaoT

When we interviewed taxi drivers in Daegu and Seoul in May–June, we learned that taxi drivers
earned at least 30% more revenue from KakaoT Taxi calls because most taxi customers call taxies
through KakaoT [54]. Even though KakaoT introduced the first allocation call service if a customer paid
one dollar (60% KakaoT; 40% taxi driver), until June 2018, customers nearly never used the payment
call allocation system. KakaoT contains of a lot of revenue business models like Table 1, but most of
them are free.
Table 1. Diverse revenue business model of KakaoT.
Category Service Revenue Situation

Basic–Free
Taxi Taxi Call Premium Call is not vitalized
Premium Call-1 $
Premium Taxi Revenue small because service in Seoul and Incheon
Black Call-payment
Call Reservation service added in January 2019
Substitute Good platform now
Driver Payment
driving but not big service
Parking Parking service Payment Not big revenue
Skyrocketing
Navigation Road Guidance Free
but free
Payment
Car-pool Ride-Sharing Major complaints from the taxi industry
No Service Yet
Platform and
Food delivery Payment This service is not in KakaoT but in KaKao
delivery
Source: authors own by interviews in May–June and November–December 2018, and news on 28 January 2019.
According to an interview with the CEO of KakaoT, Jeung JuHwan, on 7 February 2019, KakaoT
itself grew up and expanded its diverse business models through diverse merger and acquisition
(M&A) or other open innovation channels, such as the merging of the KimKiSa navigation company in
2015, merging of ‘Parking Square’ parking reservation company in 2016, collaborating with Daum
map, and the merging of ‘Luxi’, a car-pool company, in 2018.
Taxi drivers said that the waiting time for customers decreased, and they were able to receive calls
even though the taxi went outside the downtown area through KakaoT. In addition, the increase of
revenue of taxi drivers by KakaoT lets taxi drivers pay the revenue tax because measuring the taxi
driver’s income became possible.
In Korea, in the situation of a strong taxi industry, a strong public transportation industry, and a
strong automotive industry, KakaoT could not set up a real ride-sharing payment revenue system like
Figure 4. In response, KakaoT prepared a new revenue business model, such as substitute driving, and
it also faced the complaints of existing industries (Table 1). Diverse existing industries made it difficult
for KakaoT to make enough revenue in the ride-sharing system. The pressure from the taxi industry to
stop the ridesharing service of KakaoT is a hot topic. The growth of KakaoT call usage by taxis is not
being motivated by KakaoT taxi drivers but the KakaoT taxi consumers. Consequently, even though
taxi driver organizations try not to use KakaoT, because most customers of taxis call taxis by KakaoT,
they do not have other choices.
Meanwhile, regarding the business of food delivery service, KakaoT is not operating a model
even though it is popular in Uber and DiDi-Chuxing.
5.2. Responsibility Business Model and Open Innovation of KakaoT

A KakaoT call taxi driver can easily register at KakaoT with a taxi license and a photo without any
health information, criminal reports, or financial reports, which are normally required for Uber and
DiDi-Chuxing drivers.
KakaoT taxi drivers can only see the cyber phone number of the customer, which disappears after
30 minutes. Furthermore, the KakaoT taxi booking system does not give the customer a chance to book
any taxi does
system drivernotto protect
give any theinsurance
taxi driver’s business.
service to taxiAtdrivers
present,tothe KakaoT
protect thetaxi booking
driver system
and car fromdoes
the
not give
customer. any insurance service to taxi drivers to protect the driver and car from the customer.
In
In Korea,
Korea, thethetaxi
taxiindustry
industry did
did not
notprepare
prepareananadequate
adequateresponsibility
responsibility model
model toto protect
protectdrivers
drivers
from
fromcustomers,
customers,and and the
the opposite
opposite is
is also
also true
true because
because the
the Korea
Korea Taxi
Taxiindustry
industrydid
didnot
nothave
haveany
any rival
rival
industry
industry until
until now.
now. TheThe responsibility
responsibility business
business model
model of of the
the car-sharing
car-sharing industry
industry ofof Korea
Korea did
did not
not
launch because a revenue business model of the car-sharing industry was not developed.
launch because a revenue business model of the car-sharing industry was not developed. However, However, the
responsibility
the responsibilitybusiness modelmodel
business of car-sharing will be awill
of car-sharing newbe breakthrough in the process
a new breakthrough of developing
in the process of
the car-sharing industry (Figure 4).
developing the car-sharing industry (Figure 4).
Figure4.
Figure 4. Business
Business model
model and
and open
open innovation
innovation of
of KakaoT.
KakaoT.Source:
Source:authors’
authors’own.
own.
The
Thecar-sharing
car-sharingindustry
industryisisaa possible
possible solution
solution for
for unemployment
unemployment andand low-income
low-income labor
labor through
through
Uber
Uberinin San
San Francisco
Francisco and
and DiDi-Chuxing
DiDi-Chuxingin in Beijing.
Beijing. The way to respond to the powerful taxi industry,
high
highregulations, and
regulations, the the
and powerful automotive
powerful industry
automotive by the car-sharing
industry industry was
by the car-sharing the fascination
industry was the
of the responsibility
fascination business model
of the responsibility in themodel
business cases ofin Uber and of
the cases DiDi-Chuxing.
Uber and DiDi-Chuxing.
5.3. System Business Model and Open Innovation of KakaoT

KakaoT taxi drivers can know the destination of the customer in advance and cancel the call if
the destination is not a good route for the driver. This allows drivers to select customers in the KakaoT
taxi system. KakaoT changed the customer’s destination to blank for the driver one time. However,
5.3. System Business Model and Open Innovation of KakaoT

KakaoT taxi drivers can know the destination of the customer in advance and cancel the call if the
destination is not a good route for the driver. This allows drivers to select customers in the KakaoT
taxi system. KakaoT changed the customer’s destination to blank for the driver one time. However,
they had to let the drivers again know the destination of the customer because of high complaints from
taxi drivers.
If 200–300 calls are accumulated for any taxi driver, an alarm signal appears in the system and
the call opportunities to the driver decrease. Notably, there were many cancellations from KakaoT
customers after calls because the cancellation from the customer was not subject to any serious penalty
from KakaoT. However, if a KakaoT taxi driver goes to the destination without following the navigation
or the customer requirements, a penalty is given to the driver if the customer complains. A customer
complaint-based penalty to the driver is decided in this case. Similarly, the one-day one-time first
allocation service to KakaoT taxi drivers can be useless if the call is cancelled by customers.
Until now, the KakaoT payment system does not have any dominant payment system, such as a
credit card or electronic payment system.
The KakaoT taxi call system, which is the most popular in KakaoT and really operating, is in
strong opposition to the strong taxi industry, a strong public transportation system, and a strong
automotive industry without enough ride-sharing services developing in KakaoT (Figure 4).
6. Comparison of Three Firms and Discussion
6.1. Comparing Three Car-Sharing Firms in Different Economies

According to Table 2, government regulation goes the same direction with the responsibility
model. For example, Uber is high in government regulation and responsibility model such as insurance
for the driver. Contrary to this, DiDi Chusing is weak in government regulation and responsibility
model such as no insurance for the driver by the sharing platform firm.
Table 2. Comparing open innovation and business models of 3 firms.
3 Car Sharing Firms in Different

Uber DiDi Chuxing KakaoT
Economies
Government
Strong Weak Medium
Conditions of 4 regulation
open innovation Taxi industry Medium Weak Strong
channels Public
Weak Medium Strong
transportation
Automotive
Medium Weak Strong
industry
High Revenue for Driver,
Weak benefit KakaoT Black,
Revenue model Diverse, and Differential Premium Taxi-by DiDi
Business model of No-Sharing revenue
Chuxing half direct
Car sharing firms
High-Uber Insurance All insurance by Drivers,
Responsibility No insurance model, No driver
High-Customer- No safety system for
model safety model
accountability driver
Sharing Taxi driver cancel
Call allocation by Didi to
No target place in possible,
sharing car, and taxi
System model advance, Card payment Driver knows the target place
Electronic Payment
good for Uber early, Card payment which is
(Wechat or Alipay)
separated from KakaoT
Source: authors own.
Second, if the taxi industry is strong, the revenue model is weak according to KakaoT. However,
if taxi is weak, like DiDi Chuxing, the model shows high revenue. So to say, if there exists strong
industry, it is difficult for the sharing industry to make enough revenue without changing government
regulations to protect existing industry.
Third, the system model goes same direction with government regulation according to Uber, and
DiDi Chuxing. So, the system model of carsharing should consider government regulations in addition
to factors influencing matching of ride-hailing services using machine learning methods [55].
Fourth, strong conditions of four open innovation channels deter car sharing business models
according to Uber, DiDi Chusxing, and KakaoT. This means that strong, open innovation channels
decrease open innovation and diminish the business model of the car sharing industry.
The differences of three car sharing firms are motivated by context elements of three different
economies that are institutional, socio- economic, and cultural features. Though to completely answer
“What extent may facilitate or impede these the development of sharing initiatives is another research
topic?” is another research topic, we could discuss contexts factors of car sharing firms of three different
economies based on participant observations, and deep interviews with car-share drivers.
First, in the case of institutional context, less permission for innovation is needed and application
is possible in the US economy. However, in Korea economy, any innovation requires permission in
advance. In China, permission for innovation can be processed fast according to the situation. This
difference of institutional contexts of 3 economies has a high correlation with the growth of car-sharing
industries according to our field research.
Second, in the case of socio-economic contexts, the US has a mature capitalism socio-economy,
which has regulation standards for the sharing economy. However, China does not have a mature
capitalism socio-economy and does not have regulation standards for the sharing economy. Korea has
a late matured capitalism socio-economy and has wide regulation standards for the sharing economy.
Third, the US has a very diversity-oriented culture which gives motives of developing car the
sharing economy in that nearly all Uber drivers enjoyed meeting diverse customers who have diverse
cultures. However, because China and Korea have non-diversity-oriented cultures compared to the
US, car sharing drivers did not enjoy meeting diverse customers according to our interview.
6.2. Discussion: Causal Loop Modeling of Business Model Dynamics of the Car-Sharing Industry
In our case studies, according to the power of the taxi industry, government regulations, the
automotive industry, and the public transportation system, the car sharing business model can be
different. First, a strong taxi industry can motivate developing responsibility business model(BM) and
system BM, even though revenue BM is surpassed, as in the cases of Uber and KaKao-T. In contrast,
a weak taxi industry motivates the revenue BM and system BM with a decrease in responsibility BM,
as with DiDi-Chuxing. Second, strong government regulations can motivate responsibility BM and
system BM, even though revenue BM can be harmed, as with Uber. However, weak government
regulations can increase revenue and lead to a system model without responsibility BM, as with
DiDi-Chuxing. Third, a strong automotive industry can decrease the revenue model indirectly with a
direct or indirect increase of responsibility, and system BM, like KaKao-T. However, a weak automotive
industry can motivate revenue and system BM directly and indirectly, with control of responsibility
BM, as with DiDi-Chuxing.
From this case study, we developed a causal loop model of the car-sharing industry in Figure 5.
Car-sharing business models are diverse and different from each other according to the market potential,
urban geographical conditions, and other industries such as the taxi industry, knowledge conditions
including regulations, and so on, as illustrated in Figure 5, which is not linear but rather a dynamic
system with diverse loops [56,57].
indirectly, with control of responsibility BM, as with DiDi-Chuxing.
From this case study, we developed a causal loop model of the car-sharing industry in Figure 5.
Car-sharing business models are diverse and different from each other according to the market
potential, urban geographical conditions, and other industries such as the taxi industry, knowledge
conditions including regulations, and so on, as illustrated in Figure 5, which is not linear but rather
a dynamic system with diverse loops [56,57].
Taxi Industry - Government ability of

established non-sharing conflict resolution
service
+-
- +
Social Conflict on -
Sharing Service
-
+ +
System of Revenue of Responsibility model
sharing service sharing service+ + of sharing service
+ - +
+
+
Open Innovation
efforts of sharing
service
Establishment of
Competing Services
Public Transportation - (Non-Sharing & Sharing) Automotive Industry -
established competing established non-sharing
+ + +
sharing service service
Figure 5. Causal loop model of the car-sharing industry
There
There are three basic
are three basic components
components in in thethe business
business model model in in the the sharing
sharing industry: industry: system, system, revenue, revenue,
and responsibility. A
and responsibility. mutual reinforcing
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the taxi industry, automotive industry (owner driving), and public transportation differ by country.
Also, social conflict resolution on the sharing service can differ by country.
In this light, we can expect the car sharing service will demonstrate different aspects of development,
country by country, dependent on the establishment of competing service and social conflict resolution
of each country. That is to say, developing a business model of the car-sharing industry can be a strategic
selection among diverse levels of open innovation in the conditions of taxi industry, government
regulation, public transportation, and automotive industry.
7. Conclusion—Implication, Finding, and Future Research Target
7.1. Implication—Environmental and Economical Sustainability

Diffusion of carsharing services and related industries can motivate environmental sustainability
in several aspects [58]. First, according to car-share drivers, the carsharing industry can decrease the
consumption of fossil fuels, which will cut down the emission of CO2 in the air. Second, carsharing
diffusion can decrease the consumption of cars, which will decrease diverse pollution from car
production. Third, the increase of carsharing industry will cut down the expansion of public roads,
which can destroy forests, and farms by diminishing cars on the roads.
The carsharing industry can also motivate economical sustainability in several aspects as
follows [59]. First, this industry can be a new change for job creation in the fourth industrial
revolution, which normally motivates economy growth with the increase of unemployment according
to interviews of several car-share drivers [20,60,61]. Second, the carsharing industry can increase the
revenue of a household without investing additional money to create new chances. Normally, in every
household, they could earn money by working on their own time, and not using their own car similarly
in US, or China according to our interview. Third, if caring sharing platform companies expand their
role as employers such as (1) providing insurance to drivers, (2) giving balance between freedom and
responsibility to drivers, or 3) paying taxes to the government platform, etc., the carsharing industry
will create new chances for industry in the fourth industrial revolution [62,63].
7.2. Finding and Contribution of this Study

First, the business model of car-sharing firms such as Uber, DiDi-Chuxing, and KakaoT is dynamic
in so far that business models of car-sharing firms are always changing in the interaction with four
agencies, such as the taxi industry, government regulations, public transportation, and automotive
industry as new learning mode of the fourth industrial revolution [64,65].
Second, the business model of car-sharing is also changing dynamically according to the open
innovation level and strategy of the car-sharing companies [66]. So to say, the dynamics and
differentiation of business models of the car-sharing firm depends greatly on the open innovation level
and strategy of the firm, which are dependent of the power of the four agencies, and interactions with
them. The powerful open innovation of car-sharing firms will produce creative business models in
revenue, responsibility, and system BM.
The most important finding of this research is the dynamic characteristics of the business model
of the car-sharing industry, which has an intensive relationship with the degree of open innovation of
the car-sharing firm and the power of four agencies and the interactions among them.
7.3. Limits and Future Research Target

First, we should research the customer aspects of car-sharing industry because the possible
differences between ridesharing companies may come from some level of differences in the number
and situations of clients they reach. So, the research on customers of car sharing in diverse contexts
will be the future research target.
Second, concrete and dynamic roles of the taxi industry and government regulation in developing
the car-sharing business model were not analyzed. So, the study on the role of taxi industry and
government regulation in evolving the car-sharing business model should be studied as intensive
case studies.
Third, in this study, we did not analyze the evolution of the carsharing business model. So, the
business model evolution of each car-sharing firm will comprise another future research topic to
understand the car-sharing industry business model more clearly.
Fourth, we did not study success factors of the car sharing business model in any concrete
conditions. So, the dynamic success conditions and contents for the ride-sharing business model
should be studied within the following research topic. As the core of the car-sharing industry is
ride-sharing, we should focus on the ride-sharing business models and their dynamic evolution to
understand the success factors of the carsharing business model in the next research target.
Author Contributions: J.J.Y. made up research framework, and wrote all paper contents. X.Z., K.P., J.W., J.C.Y.
joined at the field research, and the revision process. W.J. supported the field research and contributed at the
revision process of this paper. All authors have read and agreed to the published version of the manuscript.
Funding: This research was supported by the DGIST R&D Program of the Ministry of Science, and ICT (69.13%*
19-IT-01, 25%*18-FA-07, and 2%*20-IT-02), and Sangji University Research Fund 2018 (3.75%).
Conflicts of Interest: All authors declare no conflict of interest.
Appendix A
Semi-structured questionnaire to interview car-share drivers (Uber, DiDi Chuxing, or KakaoT SW
using car).
1. How did you become a car-sharing driver?

2. What kind of process does the car-sharing service require you to accept and maintain as the
car-sharing driver?
3. What is the utilizing ratio of car-sharing for one month, and how many hours a day do you work
as a car-sharing driver?
4. What is the revenue for one day and one month from the car-sharing service?
5. How does the car-sharing center arrange the call when a customer calls? Can you as the sharing
car driver select customers?
6. What is the most frequently used payment method? Which payment method do you prefer?
7. Which functions do you prefer among those of the sharing car system?
8. What kind of safety related services, for example, insurances for driver, customer, car care, and so
on, do you receive from the car-sharing company?
9. What is the weakest function of the car-sharing system that you think should be improved?
10. At what time do you drive the sharing car?
11. What kind of customers do you prefer?
In addition to posing these questions, we called the sharing car driver and measured the arrival
time, their attitude, their payment requirements, and all the processes of using the car-sharing service
provided by the sharing car.
Appendix B
Table A1. Interviewee list from KakaoT Taxi drivers and major findings.
Number and Major Finding

Day and Time
Interviewee Interview Major Contents Interview Situation Improvement Proposal
2 June, 2018, 7:00–8:00am Smart Call distance limits 1–2 km
1. Kim DaeKwon Income increase with KakaoT, 30% Average 11–12 KakaoT Calls One day
Seoul Pay the points at the moment
Smart call points 2000–3000 is the requirement.
26 May 7:00–8:00 Top driver, Priority allocation of customer is used when One day 30 calls,
2. Kim HaeJung Customer cancels too often.
Seoul coming to Seoul or going back home. one month 400 calls
Opposite direction problem.
25 May 11:00–12:00 Old driver, does not use Kakao T, One day 3–10 calls,
3. Jung KuBok Car direction and customer direction opposite
Daejeon taxi driver income too small for younger generation to join priority allocation of customer: 1 time
25 May 7:00–8:00 Busy time (6:00–8:00), too many KaKao T calls. 5–10 calls per day Too many taxis in city. KaKao T increases the income
4. Oh OkSea
Daejeon Select customers After using KaKao T, income increased 20–30%. of taxi drivers without a decrease of taxis
Car-Sharing Taxi company and Individual Taxi
If stars below 5,
12 May 6:00–7:00 disagreement. Today 3 calls. On average, 10–15 calls per day.
5. Oh YongMan priority allocation 1 time per day disappears.
Seoul Taxi driver agreement Priority allocation 1 time one day
This should be from driver, not customer.
Do not receive taxi call Penalty from Kakao T
One day 6 calls Taxi driver should be treated as a human.
19 May 2:00–3:00
6. Hang HyoSuk Priority allocation customer use when go back home One month 60–100 calls, Service jobs.
Seoul
Today 2 calls cancelled by customers Kakao T can contribute to this
Priority allocation to Kimpo airport in the morning
19 May 6:00–7:00
7. Kim MungSu Weekend KaKao T is useful to find customers. is good. Map accurateness should be increased
Seoul
One day 7 hours working 3–4 calls is great
27 November
8. Kim ***Min KakaoT is double others in customer ratio Cancel ratio is 40% Call taxi a little far from main street.
WonJu
28 November Driver can see in advance the destination of
9. Yu ***Ho KakaoT driver is required to have taxi license Card 1st , 2nd money, 3rd KakaoT payment system
Wonju customers and select customers.
3 December Old taxi drivers, difficulty using KakaoT. However, majority Except special places such as bus terminal, central
10. Kim ***Ho Call KakaoT anytime.
Wonju of taxi customers use KakaoT and let all drivers use KakaoT. market, downtown, all use KakaoT.
5 December Taxi customers, young generation uses KakaoT. Major payment by card,
11. Choi ***Suk A lot of customers going to and returning from work
Wonju Nearly all taxi customers aged 60–70 age use taxi selection customer is impossible
9 December Existing taxi call systems and KakaoT call are competing
12. Kim ***Hwan Location of customer and target place can be seen Payment is under 30%
Wonju with each other
9 December At, 7:00–9:00, 16:00–18:00, there are many student Customer in apartment complexes cannot catch
13. Lee ****** Select calls that can be approached easily by taxi
Wonju customers because too far and difficult to catch
KakaoT call accumulation 200–300 or customer
12 December Does not use KakaoT, driver cannot earn additional money After card, the process from card to receiving money is
14. Yu ***won complaint let driver star points decrease, and call
Wonju for his own benefits long
allocation decreases
13 December The selection of customer standard; destination and the High cancellation rate by customers because no
15. Kim ***Kuk Payment 90% card, the rest is cash
Wonju distance penalty
13 December No service from KakaoT to taxi drivers such as insurance, KakaoT customer ratio 70%, revenue from KakaoT
16. Jun ***Sun No penalty system for canceling customers
Wonju safety, car care 60%
18 December Decreasing waiting time of customers and high possibility
17. Lee *** Bok No differentiation among customers Customer cancel penalty increasing requirement
Wonju to receive calls from customers even when in suburbs
Appendix C
Table A2. Interviewee list from Uber drivers and major findings.

Day and Time
The way should be followed if no requirement from customers.
1 As university students, one day 4–8 hours Uber Drivers Dislike drunken customers.
17 August Monday–Thursday 70 calls, $100–200 bonus.
Mehdi 16:00–22:00, good time to drive. The location of customer is not
16:46 Individual insurance.
Uber X Uber-Pool moves more than Uber X. correct.
However, accident during Uber is paid by Uber.
Rides give message at the system to driver.
2 $7000–10,000 one month Uber black announces the expensive
18 August Kind service, good communication, clean interior, good
Melese Every week Thursday payment, Uber Black 25% company, Uber SUVB 28% price in advance. Please do not show
10:00 manners.
Uber Black company it in advance.
He moved from taxi driver to Uber driver
Moved to Uber driver from truck driver.
3
When calling, announce my location. 5:00–17:00. Pool no meet case should pay the
Nestor 18 August
Walk to the designated place. Among 25 calls, Uber express 10 calls, drive fee.
Uber express 20:44
Uber express and X nearly no difference. Pool 10 calls, We paid 5 dollars once.
pool
Uber X 5 calls,
Part-time Uber driver for 1 year, from early morning 7–8 hours. After we are in the car,
4. One week 30 calls,
19 August Berkeley one day $150, one woman joined our car.Moring time 4.30–7:00. mainly Uber X 60%,
Andre +30 hours
10:06 San Francisco one day $200, 20% Uber-Express,
Uber-Pool Uber $30 bonus
Wife Uber driver. 20% Uber-Pool
At the starting time Uber Limousine Driver, before call, never One day 5–6 hours, Income decrease from one day $1000
5.
19 August knows the destination. One week/$1400, to one week $1000,
Mike
19:05 Uber black commerce insurance, 2 ways for Uber car allocation, first, driver proposes the destination, second, too many Uber drivers, customer
Uber-Select
Uber Select regular insurance, 5 dollar airport fee paid by Uber the nearest driver selects cheap Uber cars.
6. Call allocation, after ride, we can know the destination. Diverse customers, a lot of
20 August Cook, 1 year without job, next week goes back to being a cook,
Yaser Students do not complain. complaints from customers,
10:00 payment every Wednesday, end of year total reports from Uber
Uber X Uber-pool majority, most of them students System to take care of drivers needed
7. 20 August Uber-Pool, 8 minutes waiting, Income at midnight is high.
Uber-Pool, no co-rider.
Andy, 11:42 Am 10:00–17:00 major working time as Uber driver One day 7 hours, one week 6 days, $900–1800 income per week.
One day Uber call 25, Female co-rider, normally Uber-Pool
During destination, pick up co-rider at airport, and drop her at Uber-X 15 calls, user, just uses Uber X when lacking
8.
20 August her destination during driving to destination. Uber-Pool 10 calls, time,
Mohammed
13:23 Mainly midnight Uber driver, co-riding reject possible, but accept fast way usage, and incentive from Uber, Uber Lift same drive,
Uber-Pool
likes to drive workers 8 hours, Lyft better at long distances,
driver will wait at airport to take to San Jose. Uber has more customers
Individual Insurance,
Switched from delivery job to Uber, Before Uber driver, ID sending,
9. Uber insurance
21 August 6 hour part-time job, 17:00–23:00, Friday, Saturday, Sunday allowing car, insurance check, driver
Raul All,
15:33 working, license, Car Insurance, credit all
Uber-X Driver likes to meet people as Uber Driver,
6 hours 10–15 calls half Uber-X, half Uber-Pool needed.
Near University Uber-Pool many
Table A2. Cont.

Day and Time
One day 8 hours
Uber drivers have 2 jobs normally,
Electric car, $7200 Prius New Car buying, One month $5000,
10. Uber license 1 year, extended
21 August from truck driver to Uber driver, Uber system one day 15 hours operating,
Mamid afterwards.
20:58 Uber, Lyft same using, One day 20 calls, Pool 15 calls, 5 X calls,
Uber X After call 10 minutes, cancellation
70 calls $200 bonus from Uber customer drunken vomit Uber pays money to driver and receives money from
possible, driver receives $3
customer
Female driver,
Pool customer 1–2 times uses pool one day.
walked 3 minutes until appointed place,
11. Driver individual insurance,
moved from security work to Uber driver,
Akisha 22 August 2nd car damage including vomit, Uber payment and receiving money from Uber map increasing at location
female drivers 5%,
Uber express 11:31 customer, needed
Uber–Eat, one week 5 times, $3 per time,
pool vomit pay 400 dollars,
receiving a promotion of $180—if then, stop working for the
one week $900, one day 7 hours
day, Uber drug also
Female driver,
12. One day 20 calls, half X,
23 August driving in San Francisco, After 60 calls, calls are not easy,
Brenda safe as female driver,
20:32 one week 80 calls, $170–200, Uber Navigation is not good
Uber X, customer rejection possible, baby without baby sheet rejection possible
most customers in San Francisco are business men
13. Uber XL, until 6 customers possible, One day 10–12 hours, one month 6000–10,000 dollars,
23 August Before Uber driver, check security,
Martin, Uber driver + financial job, Bay area, New York, LA, big cities have Uber-Pool,
21:46 insurance, license, car
Uber XL Uber Select-XL, Uber black requires commerce insurance one day 20–28 calls
14
September 8th , Very easy to apply for Uber driver and get started. It took him 2 Not knowing the destination of the customers before the pickup is the worst Many short distance customers are
Amare C.
2018, 18:15- days to become one. part of his job. not welcome due to no money
(Uber Black)
15 Vast majority of drivers are part time
Sept. 21st , 2018, I drive Uber part time. Regular work from 9am-5pm. Uber Some customers are crazy or dangerous, so there needs to be a better customer
Matt L. (Uber driver who works around 3 hours per
18:06- driver from 5:30pm to 8pm on Fridays and Saturdays. filter app.
Black) day.
16
Oct. 5th , 2018, Even though it is against Uber policy, he calls customers before the ride starts For shorter distance, drivers lose
Alvie N. Phone app does it all. But the driver cannot select customers.
17:45- and ask for the destination. money with fees going to Uber
(Uber Select)
17 Drives Lyft as well, but don’t like
Oct. 19th , 2018, When in the known dangerous/crime-prevalent area, drivers This driver pays attention to customers with star rating that is high, and who
Roger K. losing money to customers going less
18:43- turn off their app so that no ride can be given. rate the drivers high
(Uber X) than 10 miles.
18
Nov. 20th , 2018, He does not understand why destination is not be known before the pickup. High cancelation rate hurts the
Tom A. (Uber Uber has pretty good car insurance.
18:07- This can be quite dangerous, or not profitable in short distance destination business
X)
19
Feb. 2nd , 2019, Easy to become a driver. No car care. Uber insurance for Too many Uber and Lyft drivers on
Abdul A. He was robbed at a gun point twice in downtown Philadelphia.
20:20- accidents during Uber business. the road.
(Uber Select)
Appendix D
Table A3. Interviewee list from DiDi Chuxing drivers and major findings.

Day and Time
5:00–17:00 maximum 12 hours,
1. Wechat Pay main Payment system, Driver license, insurance, under 55, no tattoos,
26 August One day 20 calls,
Guo Yan Lin individual insurance, no criminal conviction, etc. required.
10:23 2–3 pool,
DiDi Express X if driver rejects customer, star grade decreases Cannot reject pet dog carrying customer.
one month 5000–6000
DiDi-Chuxing-Premier driver should pass exam,
2. One day 12 hours, 24–25 day, 10000,
26 August 26% DiDi, Should have good individual car such as
Wang every day, dress code, photo, and car photo uploaded to the system,
19:13 20% expensive than Express X, 20% bigger revenue than Honda Black
DiDi Premier Wechat payment
express X
12 hours,
Dress (white shirt and neck tie) total income 30,000,
DiDi pay insurance,
Open door service, water, tissue, individual income 10,000,
3 a kind of DiDi Taxi,
26 August DiDi employment, welfare insurance by DiDi, 5 times expensive than Express X,
Tian Audi A6 and upper,
20:59- handsome, experience of driving: 5 years or more, every 3 times expensive than premier,
DiDi Luxury BMW 5 and upper,
day driver + 6 car photos, one day 7–8 calls,
Venture E and upper,
sometimes drive 20 km to meet customer short distance,
total 200 luxury cars
Cancel cost 13, Long-distance drive call several time,
Real Driver and DiDi is not same,
Long distance one way is difficult, Fail,
4. Xhang 2 August 27th Cancel
Allocation 2 way-choice, free allocation, One month 5,000, one day 7–8 hours,
Express X 11:01- No Beijing address Didi driver in danger, so
Choice added for a Didi driver who does not have an One day 15–16 calls express X 12–13 calls, 2–3 pool calls,
they should choose chose allocation mode
address in Beijing to let him escape the police Start in the morning, dislike long distance
Pool but no co-rider, 12 hours, 10,000
Express Pool, customer not move, driver
5. Yiheyuan 27 August Pool price difference with X 10%, One day 30 calls, 20 calls X, 10 pool,
moves to customer,
Express pool 13:44 co-ride, time, and distance makes difference in driver everyday payment,
Kia car, Express grade
income Alipay, Wechat pay
6. Jiang, 27 August
22 calls one day, 70% X, 30% pool One month, 22–23 days, 6:00–23:00, pure 12 hours, one month 10,000 3–4 km allocation too far allocation
Express X 18:39-
One day 10 hours,26 days,
one day 400
7. Ma 27 August Moved from delivery job to DiDi, Car buy for DiDi, 9:00–0:00,
DiDi driver is good way to meet strangers
Express X 20:13 DiDi call allocation in 3 km, 10 minutes if no traffic jam sleep after lunch 3 hours,
no appointment,
no long-term customer
One day 3 times cancellation possible,
8. Wang 28 August stars decrease, 10 hours, 7:00–19:00, Long distance DiDi not operate,
Express X 12:04 from 4 times driver should pay money to DiDi, 22–23 days, one day 600, one month 10,000 receipt case pay tax, DiDi income decrease
one day 20 calls, 95% Express X, the others pool
Table A3. Cont.

Day and Time
Female driver, 10 hours, 20 days one month, Luxury does not include Volkswagen,
10% female driver, 10,000, Premier and Luxury driver should not talk to
9. Zhuang 28 August
no danger for female drivers, Express than X, customer first.
DiDi Premier 14:08
Premier exam and interview, but X and under no need one day 15 calls, Therefore, not good relationship with
for exam or interview allocation of 3 km changed to 5–7 km customers
One day 7-8 calls,
One month 20,000,
Luxury car only book designated driver.
10. Yu, 28 August Wechat Payment,
High school +, driving skill, no criminal record, DiDi maintains 200 luxury cars
DiDi Luxury 17:06- Driver cannot talk to customer first,
Luxury 20% self-owned car
Short distance, long distance, no difference,
Base fee 108 if long distance
13 hours,
Move from truck driver to DiDi driver
11. Liu 28 August 6.30 until full time, Daily payment from DiDi,
When going to pick up customer, no pick up in 3 km, 3
DiDi X 19:21 25 days or over, 14,000–15,000, allocation of 3 km, but it is too far
CNY payments from DiDi,
20 calls, 15 X, 5 pool
Taxi driver,
Long distance allocation cannot be rejected because stars decrease,
female driver,
12. Liang 29 August, all taxies use DiDi app, No incentive for DiDi,
DiDi taxi calls not often,
Taxi driver 10:07 when DiDi works for taxi, taxi earns large amount of money, not many allocation calls
driver can choose choice mode or allocation mode,
taxi is not registered to DiDi
one month 8200, DiDi earnings 3000
3500 taxi company,
13. Li 29 August DiDi no pension, 57, so drive until 60, 5000 drivers,
Taxi driver income decreases from 7000 to 4000
Taxi driver 13:49 one day 8 calls decreases to 3–4 calls among this 20% from DiDi,
taxi is more expensive than express X
Car cleaning and DiDi driver 6 hours,
14. Li 29 August If DiDi driver is different several times, cancellation is possible,
DiDi exam car should stop after 8 years. Location accuracy should be increased.
Didi express X 14:37- every Friday payment
Therefore, do not want DiDi exam
15. Mr. Du Full time driver from 6 am to 11 pm
December 2018 Liking civilized and polite customer who does not complain As commissions go up, earn less and less
JingQ1D0K9 5–600 Yuan per day
16. Mr Ren Following up the trend and do some sideline work
December 2018 Platform order distribution I like function to match recent customers.
JingKAR365 Not fixed but more than 2-3000 Yuan per month
17. Mr Wang Requiring to C1 or above driving license for more than 3 Do more on weekends every week and do more on the way to and I like the function to hitch a ride.
December 2018
JingABS181 years. from work. Please activate the hitching function more.
18. Mr. Meng Platform has solved the employment problem of some The local government should regulate the
December 2018 Do driving on free time after work.
JingP7CS00 people, the platform takes too much from driver. platform for the right of driver more.
19. Mr. Chen I am driving full time because I have no other job. I could not reject orders that are far away from
December 2018 I can withdraw cash by reaching bank card.
JingP61058 260–70 Yuan per day passengers in rush hour.
Table A3. Cont.

Day and Time
I do not use DiDi as fixing way. I use it 2–3 hours a day
20. Mr. Li Sometimes the route which was proposed by
December 2018 average. I like clean customers most because I just use DiDi part-time job.
JingQW58F5 the platform is not good.
100 Yuen per day.
21. Mr. Yang I choose voluntarily DiDi driver. I drive several times I think sometimes that we drive our own cars
December 2018 I like customers who are less talkative.
JingQ85XZ6 one month about 4–5 hours a day. and earn money for others.
22. Mr. Xu I drive DiDi every day from morning to evening. The commission is too high, and it is getting
December 2018 I like service point system of DiDi most.
JingFBK895 Earn about 10,00 Yuen a month. higher and higher.
23. Mr. Zhao I used to be a so-called black car driver. After some
December 2018 DiDi software model has improved our efficiency. The handing charge is too high for each order.
JingN85AB8 colleagues started to work at DiDi, I joined.
24. Mr. Li DiDi drivers generally do not mind the settlement This DiDi app can improve the utilization rate of cars and make us The location of DiDi’s built-in map is not
December 2018
JingPC2Y00 method of customers. earn some extra money in spare time. correct, and the route planning is not good.
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Sustainability 2020, 12, 1883; doi:10.3390/su12051883 www.mdpi.com/journal/sustainability

1.1. Research Questions

1.2. Research Scope

2. Literature Reviews and Research Framework

2.1. Literature Reviews

2.2. Research Method, and Research Framework

Figure 1. Research framework—car-sharing business model dynamics.

If you highlight this study, the

Figure 2. Business model and open innovation of Uber.

3.2. Responsibility Business

4. Business Model and Open Innovation of DiDi-Chuxing

4.1. Revenue Business Model and Open Innovation of DiDi-Chuxing

4.2. Responsibility Business

4.3. System Business Model and Open Innovation of DiDi-Chuxing

of DiDi-Luxury because of weak government regulations and medium-level public transportation

5. Business Model and Open Innovation of KakaoT

5.1. Revenue Business Model and Open Innovation of KakaoT

Table 1. Diverse revenue business model of KakaoT.

Category Service Revenue Situation

5.2. Responsibility Business Model and Open Innovation of KakaoT

5.3. System Business Model and Open Innovation of KakaoT

5.3. System Business Model and Open Innovation of KakaoT

6. Comparison of Three Firms and Discussion

6.1. Comparing Three Car-Sharing Firms in Different Economies

Table 2. Comparing open innovation and business models of 3 firms.

3 Car Sharing Firms in Different

Taxi Industry - Government ability of

Figure 5. Causal loop model of the car-sharing industry

Sustainability 2020, 12, 1883 16 of 27

7. Conclusion—Implication, Finding, and Future Research Target

7.1. Implication—Environmental and Economical Sustainability

7.2. Finding and Contribution of this Study

7.3. Limits and Future Research Target

1. How did you become a car-sharing driver?

Number and Major Finding

Number and Major Finding

Table A2. Cont.

Number and Major Finding

Number and Major Finding

Table A3. Cont.

Number and Major Finding

Table A3. Cont.

Number and Major Finding

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