Dock to Lock
While CitiBike has launched with older smart-dock technology, the future of bikeshare is being tested in Hoboken this summer (as part of Bike-the-Skyline). A hybrid approach that integrates full-service bike rental with the newest bikeshare technology is being piloted by a team that includes Bike and Roll, Social Bicycles and E3Think. Hoboken far from alone. Many recently announced bikeshare programs have opted to shift away from the incumbent smart-dock technology to the newer smart-lock technology. These include:
- Hoboken/NYC (Social Bicycles)
- Las Vegas (viaCycle)
- Phoenix (Social Bicycles)
- Tampa (Social Bicycles)
- Yale University (Zagster)
Technology Evolves
Just like computers, phones and cameras, bikeshare technology continues to evolve: entrepreneurs and companies continuously figure out how to improve things. Driving bikeshare evolution from the smart-dock to the smart-lock are exceptionally high set-up costs due to infrastructure overkill. The smart-dock system (used by CitiBike and others) requires three or more docking stations per bike to make the system work. Not only does the redundant infrastructure lead to higher set-up costs, it also requires more real estate, has more things to maintain, and more components to go wrong (e.g. more computer glitches).
So what did these smart-lock entrepreneurs do? Jettisoned the dock. The smart-dock system can work with any existing bike rack system.
The newer smart-lock technology can be organized in stations just like the older smart-dock system (or a completely open system). It can use any type bike rack. These can be dedicated, or available for all. The smart-lock user can unlock the bike using a smart phone or an on-bike keypad. The new smart-lock technology can do all that the older smart-dock technology can do but at a fraction of the cost and with many more benefits.
Much of this analysis is an outgrowth of two Harvard Business School Alumni Studies for Transportation Alternatives.
The Smart Money Knows
It’s classic disruptive innovation. While some traditional smart-dockers struggled financially, the newer smart-lock companies have been financially backed or partnered with forward thinkers including Fontinalis Partners (Zagster), BMW i-Ventures as well as David S. Rose, SOS Ventures, Esther Dyson and Karl Ulrich (Social Bicycles), and Tony Hsieh (viaCycle).
The numbers speak.
Sources at bottom of page
Exportable Technology
Existing smart-dock bikeshare technology used in Washington, New York and soon in San Francisco is largely imported. In contrast much of the smart-lock technology is US in origin and thus offers export potential. As an example, Atlanta-based viaCycle is working on pilots in Vancouver, British Columbia and the United Kingdom. New smart-lock technology offers all that the incumbent smart-dock offers and more. The smart-lock technology offers:
- Much lower set-up costs
- Lower operating costs
- A smaller footprint (no docks).
- More resiliency to climate change flooding
- Increased potential for local content
- An ability to source from multiple suppliers
- Greater likelihood of bikeshare for all
Better Public Policy
Smart-dock bikeshare in Washington and Denver are used mostly by a well educated, wealthy and white demographic. In contrast the new smart-lock technology offers more ways to reach a broader demographic - including those who need bikeshare the most (which in NYC includes places like Red Hook, the South Bronx and parts of Staten Island). Its not just New York City. While incumbent smart-dock technology is prohibitively expensive for most markets, the smart-lock offers cities – especially developing ones growing at breakneck speed – an efficient, low cost solution to growing transportation needs.
Bikeshare is Ideal for Growing Urban Markets
The diagram below shows the twenty largest cities projected for 2025. The cities depicted in grey are in Global-8 (“G8″) economies. The cities depicted in black are cities in non-G8 economies. Creating a lower cost, more flexible bikeshare approach is critical for many of these markets.
A Newscast on the Smart-Lock Technology
Social Bicycles of New York City and viaCycle of Atlanta are the two leaders in the new technology space. Below is a newscast on channel 11 in New York City providing a quick overview of the Social Bicycle product.
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Sources:
(a) SF unit costs: $7.5 MM funding, divided by 700-750 bikes.
(b) Washington DC unit costs are from reason.com.
(c) NYC unit costs: $48 MM in sponsorships, divided by 6,000 bikes.
(d) Las Vegas unit costs are from company sources.
(e) Tampa unit costs are from company sources.
(f) Hoboken unit costs are from company sources.