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City releases draft bike share pilot permit + List of interested companies grows to ten

Spin, one of at least ten companies interested in launching in Seattle, recently held a test ride event at City Hall.

Seattle took a major step closer to becoming the hub of private bike share innovation in North America today by releasing a draft version of its bike share pilot rules.

This is our first look at the playing field SDOT is trying to create for a pilot program that will allow private bike share companies to operate on city streets through December 31.

The city’s experience with the pilot will help guide the creation of more permanent rules. Assuming the experience isn’t a total nightmare (it’s hard to imagine lots of bicycles being too terrible), the permanent rules could be created later this year to allow companies that comply to continue operating without interruption. The pilot could also be extended if permanent rules aren’t ready or if more experimentation is needed.

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Companies and interested parties have until June 19 to comment on the draft rules. You can view them in these PDFs: Permit RequirementsInsurance Requirements and Indemnity Agreement.

SDOT plans to then issue the final version, and companies can start applying. The city will review each application, which could take weeks. So if a company submits quickly and gets approved, they could have bikes on Seattle streets in July.

Though not all companies will be ready to launch in July, we know of at least ten companies who have expressed interest:

Conspicuously missing are the two biggest global players in the industry: Mobike and ofo. I have contacted both companies and have yet to hear back officially (I have heard at least one of them is interested). But if these companies want to get into the North American market, Seattle is positioning itself to be the point of entry.

These companies are mostly new, but together they have tens of millions of dollars in funding (hundreds of millions if Mobike and ofo are included). Many are hoping to launch nationwide, but Seattle is a rare major market without an existing bike share service. And because the city will likely be among the first cities in North America to create a legal framework for this emerging mobility service, it is likely to be a major testing ground both for these companies individually (Are they prepared for the amount of work it will take to maintain and rebalance their fleet? Are their bikes sturdy enough to sustain longterm use?) and for the concept at large.

Most companies have so far pitched rides for $1, though it will be interesting to see if any companies buck that trend either by undercutting in price or by offering higher quality bikes for a higher price. It will also be interesting to see who starts offering memberships, and how companies will compete to win the business and loyalty of heavy users.

The city’s pilot rules don’t try to micromanage each company’s business model too much. The rules require that all bikes meet international bike safety standards, the companies absolve the city of liability, the companies hold adequate insurance policies, and the companies hold bonds the city can draw from in the case of unpaid fees.

The rules also require each company to have local staff to respond to maintenance and rebalancing needs quickly. For example, a broken bicycle cannot be left out for more than 24 hours. A city request for a bike or group of bikes to be moved must be met within two hours.

Stationless bikes can be parked in the “furniture zone” of a sidewalk, shown in this image from the city’s Right of Way Improvement Manual.

The rules also outline where stationless bikes can be parked. Basically, they allowed in the existing “furniture zone” outlined in the city’s right-of-way manual. That’s where most newspaper boxes, street trees and bike racks are. Bike racks are also allowed, so the city’s on-street corrals could become hubs for bike share bikes of all brands. A minimum of six feet of walkway must be maintained, and bikes cannot block access to transit stops, driveways, ramps, parklets or street corners. No parking is allowed on blocks where the furniture zone is less than three feet wide.

In other words, don’t park them in the way. This should be obvious, but it’s up to the companies to make sure users know the rules.

The city also reserves the right to designate certain blocks as off-limits for parking bike share bikes should the need arise. Again, we won’t really know until we see the bikes in action, which is the whole point of the pilot.

But SDOT can’t give permission for parking these bikes in spaces outside their right-of-way, such as on UW campus or in parks. It will be up to those entities to figure out how to handle these bikes. I hope they have an open mind about it, because I know the first place I’d ride a bike on a nice day is to a park. Is that really such a bad thing?

The draft rules also try to filter out companies that aren’t serious. For example, companies must bring at least 500 bikes in order to apply, though companies launching with e-assist bikes are exempted from this rule due to their increased costs and service per bike. This is just so the city doesn’t need to go through the work of reviewing permits for a ton of very small companies.

Companies must pay a little over $1,800 in permit and street use fees to cover the permit review time (some of it potentially refundable if review goes quickly). They must also pay $23 per bike. So a company with 500 bikes would need to pay the city more than $13,000 to get up and running. A company with 2,000 bikes would owe the city nearly $48,000. These permits are good for a year, though the details of any permits beyond December 31 won’t be known until the pilot has been running for a few months at least.

While the companies may push back a bit on the fees (of course), the city should recover some funds for private use of public right-of-way. And people still mad about public funds wasted on Pronto (myself included) should note that this new program is set to at least symbolically start settling that debt. The city should let the public know that they’re working to make things right. Our city may end up with an incredible bike share suite of services thanks in part to the lessons learned from the old system’s failure.

Now it’s time for these companies to prove themselves.

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15 responses to “City releases draft bike share pilot permit + List of interested companies grows to ten”

  1. Ron

    Wow, this will be crazy. Like crazy good! How do the rules compare to other cities? What sort of staffing do these companies need? Thanks for the great write up.

  2. Hmmm. Pretty sure ten bike-share systems is worse than one. Just like ten mass-transit systems is worse than one…

    I can buy the idea that a few different operators might have different ideas about how to write an app, develop a service area, and provide maintenance and rebalancing. More than three or four sounds like too many. Unless these operators really have low enough costs to operate at levels of ridership that have proven unsustainable for docked systems.

    1. Dave

      Not sure that’s totally true. The bike shares don’t have to interconnect like transit. The better analogy would be car share. I don’t think there’s a problem with both reach now and car to go operating. Particularly if there is no membership requirement then it’s just a matter of having the app and be willing to pay a dollar. Yes ten might be a bit much but I don’t see a problem with 3-4.

      1. I violently agree that three or four would be fine. I can deal with having three or four bikes, but ten would be crazy. Same with apps that do the same thing.

        My worry with multiple systems is that, while they’ll probably all serve some central and particularly popular areas, they may have different coverage priorities on the fringes. This would mean some trips wouldn’t be possible within a single system. It’s easy to imagine a few companies focusing on downtown, SLU, and Westlake up to Fremont… then maybe one goes big along the Burke, starting with the Ballard-UW bit and expanding north from there (there is a theory that this is the most fertile ground for bike-share in Seattle short-term, maybe someone tests it out)… and suppose the next one identifies First Hill and the Central District as underserved, and therefore as an opportunity. They’ll clearly have to serve downtown and probably SLU to serve residents of these areas. But would they launch with a coverage area extending all the way to Ballard, or even Fremont, stretching their resources and diverting attention from their target area?

        This sort of seam was a common problem back in the days when overlapping private transit companies competed in cities like Chicago and NYC. At least NYC got a robust subway network out of it.

      2. Dave

        I guess I see it differently. As the bikes are unlinked to docks they will go where riders take them. I suspect that the companies won’t be doing a lot of redistribution unless necessary as this would be expensive. I don’t see the city licensing to restricted areas either. They pushed car share to have an expanded footprint to cover the city, and I assume it will be the same for bike share.

  3. MA

    Multiple companies are likely needed to keep them from becoming complacent on cost innovation and service without competition. If it eventually settles down to 3 or 4, that’s going to be healthy.

  4. Gordon

    Is it correct to say so far only Gonbike is the only company to have an electric bike they are considering deploying?

    1. Tom Fucoloro

      No. But I can’t say much more than that.

    2. Drew

      My understanding is that SoBi and Lattis are interested in launching a fleet of e bikes though I do not know if that is actually going to happen this summer, given how quickly this is all moving.

      I think this large number of companies makes a golden opportunity for a company to launch with a limited number of e bikes. While I agree with the earlier sentiment that signing up for 10 systems sounds like a pain, on the flip side, users will be able to use multiple systems to get great coverage and if you want an e bike but none are available within a short walk, you can fall back to a closer normal bike. A user could even snag a regular bike and switch to an e bike en route. So, even if a company can only launch 100 e bikes, they could be buoyed by the broader network of bike share bikes, resulting in very high utilization rates. I think the same can be said of bike quality generally. There will be lots of bike share bikes out there, but whichever companies win the confidence of users as the first choice stand to win big. Lower quality/poorer value bikes will be relegated to filling in the gaps and might have to exit the market.

      There will be all sorts of interesting ways to use these bikes that were not possible with the previous system. It will be very interesting to see how it all plays out operationally.

  5. Peter

    My only concern is that there is already a shortage of bike parking in some areas. I would hope the city rules include leaving adequate rack space on any block for individuals’ privately owned bikes.

  6. Eli

    As an aside, in NYC this morning, my realtor was stuck in traffic on the way to meet me for an urgent 7:30 AM appointment.

    Rather than be late, he just abandoned his car, grabbed a nearby Citibike, and made it there on time in 5 min. Then he grabbed another bike afterwards to return to his car.

    It’s pretty cool what bike share can do (assuming, of course, your city has first built out any sort of safe streets infrastructure that enables folks like my realtor to feel safe biking.)

    Conveniently, Citibike ridership is reliably growing 30% annually despite a $165-ish/year annual cost.

  7. […] few cities have taken steps to lead the way with this vision. Seattle, for example, has requested different shared bike schemes to apply for permits. Singapore has decided not to procure a system […]

  8. […] to 10 companies have been waiting to roll into town, but Seattle had to come up with a pilot permit first. The […]

  9. I was contacted last week by a manager of OFO about setting up (adjusting) the brakes for 200 bikes. Today I went to have a look at the bikes (single-speed freewheel) and assess the situation. The bikes were being poorly assembled. Everything is theft-proof ( I couldn’t remove the seatpost to grease it, no grease on the pedals by the assemblers…..oxidation here we come). Having spent the last 40 years working mostly in the local bike industry (sales, design, international purchasing, service mngr, race mechanic and owner of a local mobile repair shop) I can say these bikes won’t last the 1-2 years the managers hope they will if the bikes see regular use. That said, they’ve apparently applied for the requisite permits but only have 200 bikes being assembled. From reading the article hear, doesn’t it say 500 bikes is the minimum, e-bikes being exempted from that number?
    I wish these folks the best. I’ll go adjust the v-brakes and watch to see how long the bikes really last in a city known for being harsh to poorly maintained bikes.

  10. […] Spin bike. Image via Seattle Bike Blog. […]

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