Two men in the picture are the co-founders of Chinese startup who introduced the idea of bike sharing to the United States. The startup called Limebike and it is increasingly popular in the United States ; their green bike even earned a pet name, Cool Bike.

 Today's topic is not Limebike, but I'd like to take a moment and share the success story of Chinese bike sharing business. China once had a bad reputation of being a copycat but today not so much. Chinese companies with their own inventions are very competitive in the global market. The origin of bike sharing traces back to Mobike and Ofo – the topic of the day. Both have high market share and potential in the Chinese bike sharing market.

 During my travel through Taiwan, I was most impressive about fast and easy bike rental service. All you need is mobile number and transportation card to ride a bike every corner of Taipei. Smart phone app allows you to check the location of bikes and easily pick one. It was really easy and nice to cycle through Sun Yat-sen's Memorial Hall to Yong Kang Jie for beef noodles. I thought it would be great to have such a convenient public transportation system in China and surprisingly after a few years, the bike sharing business became a huge hit in China.

 The bike sharing business was first introduced to China in 2016 and the debut of Mobike created a sensation. Most of people using the service were young commuters and they all agreed that bike sharing is the solution to the last mile problem. At first, I did not like the idea of riding through a crowd and after the nightmarish memory of having my pocket picked on my first ride of Mobike, I thought I'd never use the bike sharing service again. But then one day, I had some urgent things to deal with but it was only about 1km away from the office and I could not use Didi Dache (taxi-calling application) or subway. I suddenly called Mobike to memory and thanks to that, I was able to complete the work. By the end of 2016, Mobike became the most popular transportation with Chinese people and it is said that the number of commuters walking to work dropped.

 However, Mobike is different from regular bikes. My first impression of Mobike was that it'd be more difficult than any other bikes I have ever ridden, from its design to parts, lock and ride quality. It is heavy itself and moreover it does not have basket, inconvenient for person carrying loads.

 Then in October 2016, Ofo made their way out of school campus and came into the spotlight. Their yellow compact sized bike took what Mobike missed. Combined with adorable design and exceptional performance, Ofo saw a surge of users. Yellow Ofo bike is lighter than Mobike's bike and charges the deposit that's only 1/3 of that of Mobike. Their easy lock is another advantage. They especially offered Free Riding Event for the first few weeks.

 To compare Mobike with Ofo, it seems that Mobike founder has put much thought into the service for the sake of practical value. They planned everything down to the last detail, including the lifespan of bike, charge and long-term plan. Meanwhile the rapid growth of Ofo was driven by trendy design and ease of use. Here I'd like to compare two leaders in the bike sharing business from different viewpoints.

 The graph above shows the number of smart phone apps downloaded according to the Report : 2016 Chinese Bike Sharing Market published in early 2017. As you can see, Mobike and Ofo share the lead.

Mobike ★★★★☆
Ofo ★★☆☆☆
Mobike and Ofo has very different first bike designs.

 The founder of Mobike went around all different factories, but could not find the right model when the business was yet on the drawing board. He asked a factory to get his design made, which costed over CNY 1,000. He thought that maintenance would cost less than the initial investment. But because of tire and bearing, Mobike is not easy to ride. Every bike of Mobike has solid tires and does not rotate using chain as any other bike does. It weights up to 25kg and it is especially not easy for women to keep working the pedal. But the innovative technology of Mobike lowered the risk of malfunction and thus ensured safe service. At least, its chain does not go slack as yellow Ofo bike does. They also released a new version, Mobike Lite that's lighter, easier and cheaper than the original version, learned from Ofo's lightweight bike. They seem to what's called an iron hand in a velvet glove; always working hard but keeping modest attitude.

 Moreover, the smart lock of Mobike is the key of their innovative bike sharing service. With the latest QR code mechanism and GPS (Global Positioning System) embedded in the smart lock, it provides big data, i.e., urban transportation data collected from each user and it is then used by the Chinese government to deal with inner-city problems.

 Ofo was able to spread fast because of its low cost, between CNY 200-300 per bike. Plus, their bike is very similar to the regular bike. But they suffered big loss because their yellow bike was easily stolen, broken. It's little difficult to find yellow bike in good conditions.

 On March 30, Ofo announced that Shenzhen would be the first to see their new model, Ofo Curve at the new model launching event held in Shenzhen, China. Besides new solid tires inspired by Mobike, a new smart lock was the most noticeable change. It allows users to create a new password and it has PGS as well.

Mobike ★★★★☆
Ofo ★★★☆☆

 Mobike began the third-party payment service in cooperation with WeChat Wallet from March 31. You do not need to download the app, but simply by clicking the mini app in WeChat, you can use Mobike. Moreover you can earn a chance of using the service free of cost together with 10 friends of yours, if you share a link via WeChat Moment. Each user will be given with 30 days of free rides.

 Working with WeChat would require great initial cost, but it is the surest way to success because there are nearly 900 million WeChat users and if Mobike and WeChat together can get their users to see the Mobike mini app, it would have great coverage of their common target. It's similar to how Starbucks made a huge success in mobile using WeChat. Up to 6 million WeChat users clicked Mobike mini app on the first day and there has been over 100% increase in the number of new members joined through the mini app. In addition, 52% of new members downloaded Mobike app. And prospects for the future of Mobike look bright.

 Meanwhile, Ofo teamed up with Sesame Credit, credit rating system by Alipay and introduced a new service to offer deposit-free rides based on credit rates of users on March 16. According to the data provided by Sesame Credit, Sesame Credit (personal credit rates based on annual consumption and use of Taobao) of most of their customers in Shanghai, China is good, as high as 650 and because of such a high credit rate, the deposit-free service by Ofo is used very often in Shanghai than any other cities. Ofo was assured that their new service to waive the deposit of CNY 99 would be a new turning point for their business, but I wonder whether people with high credit rate over 650 would like to ride a bike and care about the deposit that's only CNY 99. I think, it would be neither Ofo nor Sesame Credit, but other credit companies such as Mayi Financial that would fish in muddy waters.

 Some reports say that not many people know about the deposit-free service through Alipay and it shows that Ofo has failed to promote it to the public. To me, the service tied Ofo to Alipay rather than approaching to more customers.

Mobike ★★★★★
Ofo ★★☆☆☆

 In the midst of the marketing war between Mobike and Ofo, Mobike Hongbao (red envelope): Ride-to-Win-Cash Event quickly went viral trough WeChat Moment on March 23. The event invited Mobike users to find Mobike Hongbao Bike using GPS and ride it for up to two hours free of charge. And after 10 minutes of ride, the prize money was given, between CNY 1 and CNY 100. Prize money higher than CNY 10 was cashable and the remaining would be kept in the personal account.

 But, Ofo does not have marketing campaigns except they send a text message saying, It's free today.

Mobike ★★★★☆
Ofo ★★★☆☆

 When it comes to data collection, Mobike is nearly perfect, but Ofo has only minimum of data. It is perhaps mistake by the first founder or misjudgment of how data could be used. Mobike uses QR code to lock, unlock the bike and calculate the cost and GPS in the lock traces the route of users. Mobike's GPS collects complete data, each time a user rides the bike regardless of their consent to provision of location data and setting to help next person to search and locate the bike. With Mobike map, you will not waste your time looking for the bike.

 Yellow bike is not expensive and because Ofo did not put much thought to the lock, it is technically vulnerable. Unlike high-tech code scanning lock of Mobike, Ofo uses mechanical lock with four-digit password. It sure would be easy to collect user data, if users unlock the bike, return the bike as required. But there are some users, cunningly using their personal lock and keeping the bike as if it's their own. Plus, with the password known, smart phone app is useless. Who would want to pay again when they know the password?

 As the case stands, Ofo cannot locate the exact position of their bikes. At the early stage, the app gave only the notice saying that there are ** bikes around you. But after a number of feedbacks from users, Ofo started to improve their app and provide the location of their bike using Baidu (baidu.com) map. Yet this positioning feature is not useful at all. For example, if a user rides the bike without using the password, his/her position will not be recorded and it means that other users will not be locate that bike.

 Ofo said that their new version has GPS to supplement such a weakness of the old version. Let's look forward to new change of Ofo.

 I actually have used yellow Ofo bike because it's lighter and cuter. But while collecting data and writing this column, dedicated effort and innovation of Mobike impressed me. As the history tells, only a company working for the advancement of its business ecosystem can grow and success. Go outside and you will see all different problems of Ofo bike crowded the streets. But after some time, the one with a long-range view will survive. And I think, it is Mobike that predicts trends and continues to bring about innovation based on their long view.

 Many say that Mobike and Ofo have completely different business model and because the expected cost of the merger is too high, it is predicted that there would be no big-deal merger between them. Anyway, I wish that you all have learned from the story of Mobike. Through continuous learning and innovations, we will be able to take the top spot in the market soon.