《经济学人》精读18：Business - Ofo and Mo

China’s bicycle-sharing giants are still trying to make money

One answer would be for Ofo and Mobike to merge

Nov 23rd 2017 | BEIJING

STEVE JOBS liked to describe computers as “bicycles for the mind”—tools that let humans do things faster and more efficiently than their bodies would allow. The internet-connected bikes flooding the streets of urban China could be called“computers for the road”. Networked, trackable and data-generating, they are ones and zeros in aluminium form.

The cycles belong to Ofo and Mobike, two startups that, taken together, have raised $2.2bn of capital and are valued at more than $4bn. Each has between 7m and 10m bikes in China, averages 30m-35m rides a day and, having entered more than 100 Chinese cities, is expanding abroad. At the start of 2016 neither firm had a single bike on a public road. Ofo’s canary-yellow cycles and Mobike’s silver-and-orange ones can now be found in cities from Adelaide to London and Singapore to Seattle.

共享单车席卷中国，这是一场资本的较量，两家主要竞争公司是土黄色的ofo 和 银橙色的mobike单车。

canary: a bright yellow color resembling the plumage of a canary

Most city bike-sharing systems, such as the Vélib scheme in Paris, depend on fixed docks in which cycles must be parked. Ofo and Mobike instead pioneered a “dockless” bike secured with a smart lock that can be released with a smartphone app. They charge much less than public programmes. In London it costs £2 ($2.66), and typically lots of poking at an unresponsive kiosk-mounted screen, just to unlock a city-run shared bike. The equivalent with an Ofo, after an initial deposit, is 50 pence every half an hour and a few seconds to get going. In China rides cost between 0.50 and 1 yuan ($0.08-0.15) for 30 minutes.

It helps that the firms save on physical infrastructure such as docks. But the main reason they can afford such low fees is because they have abundant funding: in June Mobike raised $600m, much of it from Tencent, a messaging, gaming and payments giant.(Qualcomm, an American chipmaker, made a smaller investment this month.) In July Ofo raised $700m in a funding round led by Alibaba, an e-commerce and payments company.

共享单车在急速扩张，为什么能做到这么低价？因为他们有投资人的钱可以烧

Many smaller, copycat bike-share startups have gone under. Last week it emerged that Bluegogo, a distant third in China’s bike-sharing wars, had gone bust. Its puny $90m in funding and 700,000 bikes were no match for the market leaders. Another operator shut down after 90% of its 1,200 bikes were stolen six months after launch. Many schemes have been funded with scant financial analysis by investors.

Nor are Ofo and Mobike profitable, though not for want of growth. China’s bike-sharing market grew from 33m yuan in the third quarter of 2016 to 3.9bn yuan in the second quarter of 2017, says iResearch, a market-research firm. Zhang Yanqi, an Ofo co-founder, thinks China could support 300m rides a day, up from 50m-60m today.Both firms believe rental fees alone could make them profitable businesses if they stopped spending on expansion at home and abroad.

bust: to break something, to cause something to stop working by damaging it

puny: small and weak, not very large, impressive, or effective

Ofo 和 mobike 都认为市场还有巨大的增长空间，中国每天的骑行量应该是3亿左右，现在才6千万左右

Analysts reckon the real money may be in other sources of revenue. The firms hold hundreds of millions worth of yuan in deposits collected from users. For now this money lies unutilised—Chinese law is unclear about how, if it all, it can be used. But firms hope that will change. Lending it would be one possibility. Another idea is a sort of crowdsourced logistics, asking riders to carry along packages in exchange for free rides or a small payment. Mobike already incentivises users to move its bikes around to high-demand areas by offering “red envelopes”worth a few yuan. Advertising on “billboards” within wheels is also a promising avenue. And the firms can agree with brands to offer digital coupons for shops on a rider’s route. Mobike works with McDonald’s and JD.com, an e-commerce company, to do just that.

But most value could come from data, especially used in partnership with Alibaba and Tencent. The bike-sharing firms are already becoming part of their strategic investors’ business models. Ofo uses Alibaba’s credit-rating system to allow users to rent bikes with no deposit, for example. More data could be shared. As Mr Zhang puts its, the firm’s main investor, Alibaba, “already knows how much [users] spend, where they spend it and what they spend it on. But with us they have a very strong idea of people’s total activity.” Mobike says it does not share data on a commercial basis with any firm.

分析家认为他们的盈利点可能在别的地方：

第一：用户存的那笔定金，现在是没有被使用的状态，因为国家法律没有明确规定；

第二：和其他公司合作的模式赚钱，譬如叫用户帮忙带个包裹，在自行车上打广告，给用户发骑行路线沿途的商户优惠券

但最有用最有价值的东西是用户的数据，他们的骑行路线搭配他们支付行为里的习惯，大公司可以根据数据挖掘每一个人

The bike wars recall the one between ride-hailing firms in China, which ended with mergers that left one player, Didi Chuxing. Rumours of a possible merger between Ofo and Mobike have been swirling for weeks. Allen Zhu, an early investor in Ofo who is pushing for a merger, says making money is terrifically hard with so much competition. But neither Ofo nor Mobike is willing publicly to admit it. “In my entire career at Ofo I have spent less than five minutes talking about a merger with Mobike,” says Mr Zhang. “I don’t see any point or meaning in merging,” maintains Mobike’s president, Hu Weiwei.

这两家公司的竞争到底会怎么结束呢？外面很多传言，两者会合并，像当时叫车公司的竞争一样（滴滴出行和uber中国合并），但两家公司都没有公开承认要合并，欲知后事如何发展，请关注这个公众号~

总结：资本的游戏都很残酷，很多共享经济下的创业公司在烧完钱之后就倒闭了

-----------------------------------------------------------------------------------------------------------------------------

Results

Lexile®Measure: 1100L - 1200L

Mean Sentence Length: 15.83

Mean Log Word Frequency: 3.13

Word Count: 823

这篇文章的蓝思值是在1100-1200L， 适合英语专业大二大三的水平学习，应该是经济学人里属于普通难度，英语专业八级第一篇阅读也差不多这个级别

使用kindle断断续续地读《经济学人》三年，发现从一开始磕磕碰碰到现在比较顺畅地读完，进步很大，推荐购买！点击这里可以去亚马逊官网购买~