When the sharing economy turns into a sharing embarrassment, it can snap more than a few spokes in the wheels of big business.
The rise of Mobike and ofo in China, as well as various other parts of the world, has been phenomenal. But the side effects have been just as striking for these bike-sharing behemoths.
Hit by a proverbial flat tire, they have been left deflated after the Chinese craze descended into parking chaos and traffic turmoil before triggering safety concerns.
In a move to get to grips with the fallout, the authorities decided to ban expanding cycle fleets in more than 10 major cities, including Beijing and Shanghai, last summer.
“It was necessary for the authorities to put the brakes on shared bikes,” Li Hao, an analyst at iResearch Consulting Group in Beijing, told the state-owned China Daily newspaper.
To understand the depth of the problem, you have to realize there are nearly 2.5 million shared bikes in the capital alone.
Many are tightly stacked on pavements and at road crossings, causing havoc for pedestrians.
“They can be a real nuisance, especially at night,” said Li Nan, a 30-something resident in Beijing, pointing to a sprawling pile of cycles blocking the entrance to his apartment block. “Look at them . . . they are just dumped here,” Li added.
Already saturation point has been reached in leading Chinese cities. By the autumn, there were up to 70 bike-sharing brands with 16 million cycles on the streets for a customer base of about 130 million, China Daily revealed, quoting figures from the Ministry of Transport.
As negative reactions swirled around WeChat and Weibo, the Twitter-like social media platforms, a damage limitation campaign was rolled out by Mobike, including a move to bring in support teams.
The company is reported to have spent nearly US$500 million on big data, internet of things and artificial intelligence research as it gears up its global expansion plans.
From a simple idea, which allows customers to scan QR codes on their smartphones to unlock and then pay for shared-cycles, Mobike has been at the cutting-edge of the industry.
Its tread marks can be found in 170 world cities, with the company owning seven million bikes, as well as having more than 100 million customers.
Apart from China, its distinctive silver and orange cycles operate in London, Manchester, Florence, Milan, Singapore and Bangkok.
They can also be found blocking entrances and dumped in alleyways along with yellow ofo bikes and Bluegogo models.
In China, the situation deteriorated to such an extent that squads of workers had to be brought in to pick up cycles and re-stack them.
Earlier this year, tensions spilled over in Shenzhen when huge piles of bikes began appearing in alleyways and vacant lots in a rainbow range of colours.
“We are working with local governments in every city we enter to deal with issues such as users parking in the wrong place,” Xue Huang, head of communications at Mobike told The Guardian newspaper.
“In the Huangpu area of central Shanghai, the government has hired maintenance workers at metro stations to call on people to behave properly and keep order. It is an educational process,” Xue added.
Still, cyclists are regularly seen riding on pavements and dodging around startled pedestrians.
Late at night, the bikes also become serious hazards as they have not been fitted with lights just reflectors.
Even ofo’s canary yellow cycles fail to pierce the gloom on Beijing streets with limited lighting or none at all.
“They are so difficult to see in the dark,” said one American expatriate, who has worked and lived in China for more than 20 years.
Maintenance officers hired by ofo have been wheeled out to deal with congestion, but concrete figures are vague. Big data analytics technology has also been used to enhance efficiency.
Valued at more than $2 billion after raising $700 million in its latest round of financing in July, the Beijing-based company has only been on the road since 2014.
Yet it now has more than 10 million bikes in 13 countries, including the Czech Republic, Italy, Russia and the Netherlands.
By the end of the year, ofo expects to have wheeled out 20 million bikes in 200 cities across the world after moving into markets in the United States, the United Kingdom, Thailand, Malaysia, and Japan among others.
“We are committed to bringing a green service to every city in need of convenient short-distance travel solutions,” Dai Wei, founder and CEO of ofo, told the Chinese media.
Admirable sentiments. But its green image is in danger of being tarnished by black spots on a long and winding road for the bike-sharing boys.