Bikeshare-news.com was present at ECF’s PEBSS workshop 2017 in Brussels on november 20th-21st. We will produce several articles in the following month to report the main ideas that have been emphasized during these two days. Second chapter: thoughts around dockless bike-sharing.

Guess what…. the central topic of the PEBSS workshop was dockless bike-share! All the topics were actually discussed with dockless in mind. The disruption has been so brutal that historical suppliers, operators and even authorities seem to be reaction less in front of the dockless bike-share expansion.

Everybody is waiting for a regulatory framework

What was striking was the need for a regulation framework, claimed by ALL parties (operators, suppliers, authorities). As an introduction to an exercise report from the industry group of the workshop, M. Kevin Mayne, ECF’s development director, declared that “it was the first time that industrials were asking for MORE regulation to an EU organisation!”. When you’re lost, you need rules… The ECF and UITP already wrote the draft of a framework, and needed to complete it.

For a well designed, evolving scheme, there is a need of coordination between private operators and authorities. Local authorities have to give the GO to any operator in order to keep the hand on their transportation network, and to manage the whole lifespan of the project. So far, there is no globally agreed way of doing, so every city is trying to do its best. “Talks only” worked so far, but authorities are becoming aware of the need to regulate the dockless bike-share development in their area, and have to adopt licensing/registration in order to set its own goals (for number of bikes, quality of service, public space management) and to monitor it.

For the user safety, there’s a need for more control of the bikes quality. Well, that’s a point raised by many historical station-based solution suppliers 🙂 To be fair, there is two categories of dockless shared bikes: cheap ones (Mobike, Ofo, Obike…), and high-end (Mobit, Jump, Pace…), but the power in is the hands of the first group. Yes many of the parts of these bikes do not exude solidity. Yes, some of the smart-locks used by those companies are not certified in some countries. In order to preserve the user integrity, cities have to set high quality requirements (FYI, most of the station-based systems bikes get the EU mountain-bike certification).

It has been “funny” to hear from all the cities where dockless bike-share operators are present that they do not have any idea of the staff sizing operating the schemes. As there is no agreed SLAs from the beginning, the quality of service is setted by the operator… Servicing and Balancing Level Agreements have to be discussed initially, as for station-based schemes. Singapore put an important milestone in september, with a MOU requiring all operators to respect servicing and balancing periods.

In the same vein, the problematic of public space use have to be addressed. To avoid crazy situations seen in China, where bikes are piling up, the number of bikes have to be set and controlled by the authorities. Careful, it will be tricky with multiple operators! As OBike, partnering with IoT specialist UnaBiz, all suppliers know that they have to improve on the geolocation accuracy: geo-fencing now seems mandatory to monitor dockless bikes parking efficiently. We also heard several examples (Singapore’s LTA, OBike UK…) where private operators and authorities are working together to create more parking spaces (dockless specific, or even better, public). But it has to be written in black and white to be achieved!

Finally, referring to my previous article, data have to be shared, at least with the relevant authority. Getting this data feed (in GBFS standard, please) is primordial to improve and develop the bike-share network, and to integrate it in a multimodal transportation network. If the current data from bike-share schemes is used, the amount coming from dockless schemes is way bigger… and different authorities from major cities admitted that they do not know how and why to process these data.

A mystic business model

The disruption of the new “dockless bike-share solutions” is not coming from the technology. As raised by Moventia and NextBike, dockless solutions with smart-locks have been operated by Call A Bike since… 2000! The disruption is coming from the business model. Until now, we are watching a wrestling match, where big companies are fighting for territories, and drowning their weakest opponents. Mobike, Ofo and co are funded by capital ventures, for billions of dollars this year only. And… they are still struggling to make money from the ride fees, even if they believe it could be sufficient if they stopped spending on expansion.

Lending the huge amount of deposits, developing crowdsourced logistics, targeted advertising are different income options. But, most of all, they are seated on huge amounts of data, and most of the observers affirm that selling it will be the main solution to make money. Every user of a dockless bike-share app is bascially giving access to all his phone data, so third parties will surely be happy to buy a piece of cake.

Today, there are plenty of actors in the western market. Some are different by their high quality bikes (Mobit, Jump…), some by their way to collaborate with local authorities (Urbo…), some by their financial power (Mobike, Ofo, OBike…). All have different business models, and we will evaluate in the coming years what companies will have match the citizens need and build a sustainable model.