Integrating Dockless Bikeshare in your Community

Integrating Dockless Bikeshare in your Community

March 29, 2018  | Stefanie Brodie

Since 2010, in a growing number of cities across the United States, you can unlock a brightly-colored bike from a specialized dock, ride around town, and dock it at a station near your destination. More recently, privately-owned dockless bikeshare companies have harnessed technology of GPS and smartphone apps to remove stations from their model of shared mobility, offering users flexibility and localities service without capital or operations expenditures. Even without a financial commitment, localities offering their valuable public space for operations are investing in these companies. As a savvy investor, local governments and agencies must ensure they see measurable returns that advance transportation goals. To improve return on investment (ROI), localities should focus on how new technology aligns with broader transportation goals, establish regulations and data sharing requirements, encourage cooperation with operators, and consider the viability of dockless bikeshare companies to provide a mobility service in the long term.

Private dockless bikeshare operators are profit-driven and beholden to their investors; however, they operate in the public realm and therefore must be held accountable to the people they serve and the goals for the transportation system. Businesses are driven to provide a quality service to consumers to preserve their brand and increase profits; however, the public goals of equity and safety do not have the same clear link to generating revenue. Several dockless bikeshare companies have announced equity programs, but operators have struggled to tackle the access boundaries for the unbanked or those without smart phones, to offer reduced fare options for low-income travelers, or to engage with communities. Furthermore, safety standards for publicly available bicycles simply do not exist. These issues highlight a critical step for ensuring dockless bikeshare companies advance transportation goals: regulation.

The infamous “bikeshare graveyards” in Chinese cities have led the Chinese Government to reign in operators via regulations. Dockless bikeshare entered the market in China in 2015 and expanded quickly and widely across the country; however, regulation is recent. Dockless bikeshare companies expanded to Europe and arrived in the United States in 2017. Regulations and guidance in these newer markets is emerging as well. The European Cyclists’ Federation has published a position paper with guidance for cities courting dockless bikeshare (or companies courting cities) and similar guidance is underway by American organizations. Some cities such as Seattle and Washington DC have allowed dockless bikeshare pilots via public space permits with requirements that limit fleet size, restrict parking locations, and mandate data sharing. Pilots allow governments, notorious for moving slowly, to be more agile and adapt as lessons are learned.

Regulations or agreements with dockless bikeshare companies (or any other private service providers) should include data sharing requirements. Data is critical; it facilitates an opportunity to evaluate service and make performance-based adjustments towards goals. Additionally, data from dockless bikeshare can serve future planning needs. In an interview with the World Resources Institute, Mobike’s CEO expressed his desire to use the nearly 30 terabytes of data they collect daily to help cities optimize transportation planning and make decisions on bicycle infrastructure and traffic management. A common data standard and a common set of core performance metrics would help facilitate data sharing for localities and dockless bikeshare companies alike.

Another mutually beneficial action to strengthen ROI is fostering cooperation between operators and local governments. Cautious cities and differences in existing regulation across jurisdictions have forced operations in the US towards a cooperative model where dockless bikeshare companies engage with localities. Preemption bills that would consolidate regulatory power at the state level, like the ones proposed (but defeated) in Florida legislature, could remove some of the complication for dockless bikeshare companies; however, they jeopardize the ability of localities to ensure a standard of service and be in full control of their investment and they limit partnership between localities and the companies.

Finally, the financial backing by private venture capital funds presents concerns about dockless bikeshare companies (and other private mobility companies) operating a sustainable public service. The long-term viability of these companies as mobility service providers is uncertain. For instance, China-based bikeshare company Bluegogo was among the top three dockless bikeshare companies in the world until it filed for bankruptcy late last year. Furthermore, the other top companies, also based in China, have stated that their primary goal at this point is not to focus on profits but to increase brand recognition and scale. They have also expressed interest in developing sharing platforms in the next few years that would include a wider range of transport options and could potentially be sold to governments. Although they may not be planning to leave the mobility operations market fully, they are angling for what they acknowledge as a potential industry bubble on the horizon.

Dockless bikeshare presents an opportunity to increase bike ridership, improve mobility, and better understand biking in our cities; however, dockless bikeshare operators are private, venture-capital funded companies and are therefore beholden to investors and have an uncertain future. Localities that invest their resources in dockless bikeshare in hopes of seeing transportation benefits must hold these companies to the same goals of providing safe and equitable service they hold for themselves. By developing regulation, evaluating performance towards goals with data, and working with operators, such service is encouraged and enforced and uncertainty can be managed. Local governments and transportation agencies should view dockless bikeshare as one tool to achieve transportation goals among many and diversify their investment portfolio for the broader transportation landscape as it morphs and adjusts to new and ever-improving technologies.

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