Criminals are removing the GPS tracking from oBikes and selling them online

JUST when you thought the problem with GPS-tracked bicycles found littering the streets of Sydney and Melbourne couldn’t get any worse, this happens.

THE dockless bicycle sharing scheme launched in Melbourne and Sydney is nothing short of a disaster.

You only have to look at the plethora of bikes damaged beyond repair and left on sidewalks or at the bottom of lakes to see the concept has more than a few teething issues.

While these incidents are reason for concern, there is now a new threat facing the companies.

Over the past couple of weeks, criminals have uploaded a number of posts to social media offering the bikes for sale — sellers claim the GPS tracking system/locking mechanisms have been removed from the bicycle.

A man selling an O-Bike for $30.

The news comes as Waverley Council announced it will begin impounding damaged or obstructive bikes left around Sydney’s eastern suburbs in an effort to clean up the mess.

“We’ve got a few people lined up … a couple of teams will get around the municipality over the next six hours or so and let’s see what we find,” Mayor John Wakefield told 2GB.

“We’ve got a truck, we’re going to photograph them, tag them put them on the truck, take them out to our depot at Alexandria.

“If they [operators] wish to recover them they have to pay a fee of $70, if they don’t recover them eventually we will recycle them after a period of time.”

Waverley Council’s decision to go after the bikes follows a long list of complaints about the “visual pollution” the GPS-tracked bicycles have caused since emerging on the streets.

More Sydney share bike situations (Cooks river in Marrickville) @IWCouncil pic.twitter.com/2DlFeR9Ffi

— Elias Plastiras (@eliasplastiras) February 14, 2018

Sydney bike share seems to be working well. Plenty of bikes available here...... pic.twitter.com/wG0ZufgI2F

— David Clarke (@D_C_68) January 4, 2018

Proper parking in #Clovelly #obike #Sydney #sydneyobike #bikeshare #cyclinglife #cycling #gordonsbay pic.twitter.com/U9lUxkyh5I

— Tris da Cunha (@trisdacunha) January 11, 2018

@ObikeUK OBike in a tree. Corner of Newcastle St. and New South Head Road, Rose Bay, Sydney, Australia. Missing Helmet. pic.twitter.com/Fgf4JpzE7S

— L J R (@Earl_GreyT) October 11, 2017

HOW DO THESE SERVICES MAKE MONEY?

Both Melbourne and Sydney have seen the introduction of oBikes — yellow, GPS-tracked rental bicycles that rent for just $1.99 for half an hour, plus $69 membership fee that is refundable on request.

Sydney has also seen the introduction of ReddyGo — red, GPS tracked bikes that rent just $1.99 for half an hour, plus a $99 membership fee that is also refundable on request.

However, given the constant damage and emerging theft of these bikes it’s hard to imagine how they could make money.

As an expert in urban and regional development, strategic planning and analytical methods in urban studies, Professor Sun Sheng Han said the most straightforward money-maker is the profit generated from the ride-and-pay model — the $1.99 the company gets from the customer per half-hour of use.

If a bike is used for 10 half-hour trips per day, it would have a daily return of $19.90. If it were used at this frequency for a three-month period it would return $1,791.

Prof. Sheng Han estimates the initial outlay of the service and operational costs like repairs or replacements would be recouped over this three-month period if each bike was used at this frequency.

But the likelihood of every bike being rented this often seems low, especially given the increased competition.

With over 10,000+ oBike apps downloaded on iOS and Android devices, and similar amounts from ReddyGo, data from the GPS-tracked bikes could offer a source of secondary income.

“A huge data set can be examined to assist future business developments, planning and management in local councils and marketing companies,” Prof. Sheng Han told news.com.au.

The data of the cycling behaviour also helps to give a more detailed picture when combined with that taken from taxi and public transport systems.

There is also money that can be made from the refundable membership fees.

“It’s not a profit in the sense they can spend that money. They need to keep the deposit in case someone wants to be refunded, but there is the large interest that the sizeable pool of money they are holding for the operation would earn.”