In the analysis the App's commission is not accounted for, which is about 20%.
Also, i highly doubt that 15km/15 hr scenario will ever play out. Most cabs tell me that they do a 10km/12hr scenario.
Also, the analysis has not factored in the fact that, for a trip billed at 10km, the driver actually travels 2-3km to arrive at destination, and the cost of trip is actually 20% higher.
So put in the commission and the distance travelled and you will see a much more gloomy picture.
I think two scenarios can play out in India
People get addicted and continue to use it when price increases(what i call the Multiplex Popcorn syndrome)
Reverse network effects will kick in: Currently, the market is in equilibrium with cabbie taking home just about enough to prevent defection to alternate employment. But that equilibrium is induced by VC money and not inherent efficiency.
When price increases, some riders will move out of system, meaning drivers will have lesser rides and lesser income(assuming price elasticty >1). Hence, it becomes unviable for some drivers forcing them to search alternate forms of employment and a new equilibrium is temporarily reached with lesser riders and lesser drivers. But because supply reduced, the ETA(estimated time to arrive) will increase creating a visibly poorer experience for riders.(a cab that took 5 mins to arrive may now take 10). leading to more drivers going on road and hailing a transport than waiting for a service who had increased their prices. and the cycle continues until the system crashes