Bike-Sharing: Cycling to a City Near You

Nearly every major city in the U.S. has plans for some sort of bike-share program, but there’s still plenty of room for growth.

Bike-Sharing: Cycling to a City Near You

The road to bike-sharing is paved with broken locks.


Rampant theft and stolen parts have plagued bike-sharing programs since the first one debuted in Amsterdam in the 1960s. But that hasn’t stopped cities from trying: Paris’ initiative–among the world’s most advanced programs–has been mired by theft and vandalism. More than half of the initial fleet of 15,000 custom-made bicycles in Paris have gone missing, and many more have been defaced and destroyed.

And yet, in the two years since Paris launched its initiative, dozens of similar programs started in cities around the world, from Hangzhou to Rio de Janeiro. Bike-shares are the fastest growing form of transportation in the world, according to Timothy Ericson, CEO and co-founder of consulting firm CityRyde. And there’s plenty of room for more growth. Ericson expects the number of bike-sharing programs to increase 200% in 2010. This year alone, nearly every major city in the U.S. has drafted some sort of bike-share program.

CityBikes Stockholm

But cities are still grappling with how to pay for and maintain the fleet. Here’s a look at where bike sharing stands today, and where it’s headed.

On the surface, nearly all of the world’s 100 or so bike-share programs look strikingly similar. Most systems rely on unmanned rental kiosks that are managed by automated computers, and bicycles are equipped with advanced locking mechanisms. Many of the the bikes use customized parts to stave off thieves who are looking for spares.

The differentiating factor in these programs is how they pay for themselves. Most systems, particularly those with more than 500 bicycles, rely on advertising–and the lucrative deals the agencies strike with host cities–to stay afloat. Other programs depend on money from local communities, like Montreal’s Bixi. Still others are funded by private investors (London’s OYBike). Many of the private programs have disappeared, and the handful that remain tend to be limited to college campuses, business parks or specific neighborhoods. “Bike sharing just isn’t profitable by itself,” Ericson says.

Ad Value
The three largest bike-share programs–those in Paris, Lyon and Barcelona–are all run by advertising companies. Earlier this year, ClearChannel launched SmartBike, the first comprehensive bike-share program in the U.S., in Washington, D.C. This is the fastest way to get a bike sharing system going.


“In Paris, the city signed the contract, got the program off the ground and opened it up in within six months,” Ericson said. “In Montreal, where the program is user-funded, that same process took two years.”


Here’s how it works: Cities award long-term contracts, sometimes for as many as 15 or 20 years, to advertising agencies, giving them ad space on billboards, outdoor furniture, kiosks and other public areas. The advertising companies, in turn, must set up and maintain a bike-sharing program in the city. But advertising companies have little incentive to maintain the programs once they’ve secured contracts and ad revenue.

Instead, Ericson and other experts agree, the bike-sharing program of the future will be run by public or quasi-public entities, and won’t rely on advertising revenue to keep it going. A case in point: Montreal’s Bixi.

City Cycles
Montreal’s Bixi, which became one of the newest and most innovative bike-sharing programs, was established in May 2009. In what is likely a first, the system was designed, implemented and is maintained by the city’s parking authority.

“We already had a Pay ‘N Go parking program, where people could park there car, walk to an automated kiosk and pay for their spot,” said Alain Ayotte, CEO of Public Bike Systems, which oversees Bixi. “Ultimately, renting a parking spot and renting a bicycle are technically the same thing.”

So far, the program has been cost-neutral, says Ayotte. It’s not completely without help from ad revenue: 200 of Bixi’s 300 stations feature some sort of advertising. But ad revenue accounts for only 5% of the program’s operating costs, compared with the fully ad-funded models in Paris and Washington DC.


Bike to the Future
No one’s quite sure what the future of bike-sharing will look like. But Bixi is a good place to start: It doesn’t cost the city a dime, runs on solar power, and is portable (the modular system, which can be installed in less than an hour, has been rewarded seven patents).


There are smaller innovations being used around the world as well. Samba, a bike-sharing program in Rio de Janeiro’s Copacabana neighborhood, is activated by cell phones. Bicinittà, an Italian company with bike-shares in Genoa and Monaco, offers pedal-assist bicycles to help uphill riders. In Paris, Velib is improving its distribution of bikes by awarding customers an extra 15 minutes of riding time for dropping off bikes at designated uphill stations. That, says Paul DeMaio, a managing member of MetroBike LLC, ensures that buses, trucks and vans won’t have to haul bikes to different stations across the city, a process that can cost as much as $3 per bike.

Upcoming advances in bike-sharing will be “more incremental” than the evolutions in the past, says DeMaio. Among his predictions for the future: Seasonal programs like the one in Montreal that can be packed up and moved during winter months; and bicycles fitted with GPS devices to track travel routes and locate stolen bikes.

“That’s the key,” DeMaio says. “Once transportation planners can figure out where and how far the bikes are going, they have the sort of great juicy data that validates bicycling as a mode of transport.”