Monday, June 10, 2013

Portland should embrace new bike share technology

Bike sharing systems have skyrocketed in popularity over the last 10 years in the United States. Minneapolis, Washington DC, Denver, Philadelphia, Boston and now New York have extensive networks of bike sharing docks placed on street corners, plazas and parks throughout the city. The docking station was the key innovation that addressed issues of security, payment, and circulation that plagued past attempts to implement a bike sharing scheme. But new technology is integrating the functions of the docking station into the bikes themselves, offering promising benefits to both users and operators that may catalyze another wave of expansion of bike sharing in the future. Portland, the top bike city in the country, should lead the way in deploying this technology when they roll out bike sharing next year.

Social Bicycles is the inventor of the new bikes. The company built three functions into the frame of the bikes that enable them to go without the docking stations: locking, GPS tracking, and payment. First, a u-shaped lock is connected to the bike that can be used to secure it to almost any standard bike parking rail. Second, the lock is connected to an on-board GPS that automatically switches on once the lock is engaged. So, when the user is finished with the bike and parks it, the GPS is triggered to send out a tracking signal so other users can locate the bike using a smartphone application or on a website. Third, when a user has located a bike and is ready to start using it, they can input their subscription ID number and a pin on the bike’s keypad to release the lock and start riding.

Dockless bike sharing offers a level of mobility that goes beyond even bike ownership. The bikes can be picked up and dropped off anywhere within the geographic boundaries that the bike share operator determines. Docking stations, because they have to be centrally planned and implemented before travel patterns are fully understood, inevitably will be used unevenly across the city. For users, the station is often not close by to their destination, adding a layer of unpredictability that makes some people less comfortable with this transport option.

For operators, dockless bike sharing is a game-changer when it comes to fixed capital costs. Including the cost of docking stations, the up-front capital investment per bike is at least three times greater for systems that use docking stations than the Social Bicycles model. Lower capital costs means there are lower barriers for new bike share operators to enter the market, opening up the opportunity for multiple bike share operators to exist in the same city. This complicates the city’s role in regulating and overseeing bike share systems, but it also offers enormous opportunity to expand bike share to new levels.

The current model for public-private partnership for bike sharing resembles the arrangement commonly used to build and operate toll roads. The public, possibly in partnership with sponsors, puts up a lot of the capital investment, and the private company operates the system and in return receives part of the profits. Given new bike share technology with lower capital costs, the public could migrate to a model that more closely resembles taxi cab regulation. For example, Portland could open up the bike share market to any operator that thinks they can turn it into a profitable venture. The city can regulate and license bike sharing operators to ensure they are free of fraud and the bikes are safely maintained.

However, given some of the drawbacks of dockless bike sharing, there still remains a need for a docking stations to be the base of any citywide system. The main challenge with dockless bike sharing is that it may be inaccessible to low-income users who don’t have the smartphones or internet access to use the GPS tracking to locate the bikes. For this reason, the city should still pursue a dock-based bike share system as the basic service. But they city should also encourage the formation of other bike share operators through licensing and regulation. These dockless operators could fill the gaps where docking stations aren’t justified, or they could operate in specific areas of the city, such as downtown.

Instead of monopolizing bike sharing in Portland, the city can find creative new ways to enable new private operators to enter the market and further expand the reach of bike sharing. The more options available, the more likely the system will be widely used.

Edited by Tom Shook

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