"[W]e look forward to working closely with regulators towards developing a regulatory approach that enables more choice and innovation while putting the safety and interests of riders and drivers first," Gellman said.

If both sides are willing, what then is the problem?

Well, go visit trendy spots in Hong Kong like Lan Kwai Fong and watch the people who use Uber services, and you will know why. They don't want taxis; they want nice, especially luxury, cars to transport themselves and their friends about town. And they are willing to pay more, sometimes much more, than regular taxi fares. So you can't win them over on price.

And there's the rub. Officials are perfectly fine if licensed taxis use advanced Uber-like apps to add to their services.

That's what Yuen meant when he said there was space for the legal operation of Uber and other similar taxi services. That fits well with Chief Executive Leung Chun-ying's agenda of promoting technology-driven value-added services in the economy. It's why the government's InvestHK initially supported Uber, at least until the latest police operations.

But it's unlicensed, non-taxi vehicles that most Uber supporters want. More than 50,000 people have signed an online petition supporting the car-hailing app after police arrested seven Uber partner-drivers and three employees at the firm's offices.

Customers have voted with their feet and they want nice cars, not our regular taxis frequently offering substandard service. But how do you license regular private cars without destroying the value of taxi licences or threatening the livelihood of taxi drivers?

At the moment, the government doesn't see a way out, hence the police crackdown under pressure from the powerful taxi lobby.

Despite the mutual profession of good will, both sides are stuck.