China’s Mo­bike fills a gap in UK shar­ing econ­omy

China Daily (Hong Kong) - - CHINA - By CE­CILY LIU in Lon­don ce­cily.liu@chi­nadaily.com.cn

Within a few weeks of the launch of Chi­nese bike-shar­ing com­pany Mo­bike in Manch­ester, United King­dom, lo­cal res­i­dent James McCon­nell had al­ready used the bikes more than a dozen times.

“They are easy to use, great for short dis­tances, and I’ve never been un­able to find a bike when I needed one,” said McCon­nell, 33, a post­doc­toral re­search as­so­ci­ate at the Univer­sity of Manch­ester, who of­ten cy­cles from the univer­sity to other parts of the city.

Mo­bike’s launch of 1,000 bikes in Manch­ester last month is one ex­am­ple of how China’s bur­geon­ing shar­ing econ­omy is spread­ing to the UK. Ri­val bike-shar­ing com­pany Ofo is mak­ing a sim­i­lar ef­fort in Cam­bridge.

Bike shar­ing in the UK is not new. In Lon­don, San­tander Cy­cles is widely used. But Mo­bike and Ofo are chal­leng­ing the sta­tus quo by not re­quir­ing con­sumers to re­turn the bikes to fixed dock­ing sta­tions and by cut­ting the price.

This small de­tail is hailed by Bri­tish schol­ars as an in­no­va­tion within the the­ory of the shar­ing econ­omy.

“This holds a very high po­ten­tial to foster char­ac­ter­is­tics that re­search has iden­ti­fied as cru­cial for suc­cess­ful shar­ing schemes: flex­i­ble, in­di­vid­ual and on-de­mand mo­bil­ity,” said An­tje Graul, a doc­toral re­searcher in mar­ket­ing at Leeds Univer­sity Busi­ness School.

Graul added that Mo­bike and Ofo’s use of track­ing data, lock­ing mech­a­nisms, se­cure and easy mo­bile pay­ment, and com­pet­i­tive pric­ing strate­gies are other win­ning ad­van­tages.

Diane Coyle, a pro­fes­sor of eco­nom­ics at the Univer­sity of Manch­ester, said Mo­bike was smart to spot a gap in the mar­ket and tar­get Manch­ester, a city that had no bike-shar­ing pro­gram. She said what will de­ter­mine suc­cess will be whether it can reach crit­i­cal mass quickly enough.

Mareike Moehlmann, as­sis­tant pro­fes­sor of in­for­ma­tion sys­tems and man­age­ment at Warwick Busi­ness School, added that Mo­bike’s cur­rent low charge of 50 pence (65 US cents) for 30 min­utes is not an im­ped­i­ment to fu­ture prof­itabil­ity, be­cause once scale is achieved it can raise prices.

“It might not cover all their ex­penses and they may run at a loss, but once net­work ef­fects take hold and they have built a big con­sumer base, they can then in­crease prices,” Moehlmann said. “It is an in­vest­ment for the fu­ture.”

Look­ing be­yond bike-shar­ing pro­gram, Coyle said there could be room for other ideas from the Chi­nese shar­ing econ­omy that could suc­ceed in the UK, es­pe­cially costly items that are not used all the time. Items that fit those char­ac­ter­is­tics in­clude cars, lodg­ing and park­ing in drive­ways.

Lower-cost items tried in China, such as um­brel­las or laun­dry ser­vices, are far less likely to suc­ceed, Coyle said.

PRO­VIDED TO CHINA DAILY

A man rides a Mo­bike ear­lier this month in Manch­ester, UK. The com­pany placed 1,000 bikes in the city in June. Ri­val Chi­nese com­pany Ofo is mak­ing a sim­i­lar ef­fort in Cam­bridge.

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