Menulog Departs Australia, Shifts Users to Uber Eats; Duopoly Concerns Mount in Food Delivery Market

Menulog Exits Australian Market, Redirecting Users to Uber Eats Amidst Duopoly Fears

Australia's food delivery landscape is undergoing a significant transformation as Menulog officially ceased its operations, redirecting its customer base to competitor Uber Eats. This strategic shift, finalized at midnight on Tuesday AEDT, has sparked considerable discussion and concern regarding the potential for a duopoly in the Australian market.

The Transition to Uber Eats

Effective Wednesday, 12:01 am AEDT, former Menulog users must now transition to the Uber Eats platform to place their food delivery orders. This move comes as part of a new commercial agreement between the two companies, which Uber Eats states will "help ensure customers can continue to enjoy the restaurants they love" and allow "restaurant partners and delivery people can maintain access to earning opportunities."

Upon opening the Menulog app, users are greeted with a prompt directing them to download and utilize the Uber Eats application. This redirection is already in effect for many, signaling the immediate impact of Menulog's withdrawal.

Duopoly Concerns Emerge

With Menulog's departure, the bulk of Australia's food delivery market share is now consolidated between Uber Eats and its primary rival, DoorDash. This concentration of power has led to concerns about a potential duopoly, a sentiment echoed by experts like Alex Veen, a senior lecturer in Work and Organisational Studies at the University of Sydney Business School.

"It very much looks like we're heading towards this duopoly-type situation in the food delivery sector," Veen stated, adding that consumers would naturally question the implications for delivery pricing in such a market. He highlighted the commercial nature of these enterprises: "These businesses, they're not charities; they come in, they want to get that market share, but they want to see a return on investment. We've already seen some of the prices going up."

Incentives for a Smooth Transition

To facilitate a seamless transition, Uber Eats has rolled out a series of concessions and incentives aimed at attracting former Menulog couriers, restaurant partners, and customers. These offers include specialized promotions for individuals residing in regional Australia, demonstrating Uber Eats' efforts to absorb Menulog's network effectively.

Context: TWU Agreement with Gig Economy Giants

Notably, Menulog's exit closely follows a significant development in the gig economy. Just the day prior, the Transport Workers' Union (TWU) announced a groundbreaking agreement with both Uber Eats and DoorDash. This accord, hailed by the union as a "significant step" towards enhancing fairness for gig workers, sets new standards for the sector. TWU national secretary Michael Kaine urged other remaining delivery services, specifically naming Hungry Panda and Easi, to adopt these changes promptly to ensure industry-wide standards are established as soon as possible.