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Uber attorneys challenge Lyft’s Bay Area bikeshare monopoly

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A woman rides a Ford GoBike along the Embarcadero on Tuesday, July 3, 2018. (Kevin N. Hume/S.F. Examiner)

Uber is asking Bay Area transit officials a question key to the region’s transportation future:

Hold on, why does Lyft have a monopoly on bikeshare again?

In a detailed, seven-page missive to the Metropolitan Transportation Commission obtained by the San Francisco Examiner, an attorney for Uber-owned bikeshare company JUMP challenged the exclusivity contract between Bay Area cities and Ford GoBike.

“I write to explain our analysis that Motivate does not have contractual exclusivity over e-bike or dockless bike sharing programs,” wrote attorney Mark Linderman last December.

Ford GoBike is operated by Motivate, which has a ten-year exclusive contract with Bay Area cities to run docked bikeshare operations, including in San Francisco. Motivate, which operates roughly 3,700 shareable bikes Bay Area-wide, is owned by Lyft

JUMP operates a comparatively small 500 dockless bicycles in San Francisco, but it’s no secret they want to expand: They’ve previously applied for permits to operate on a larger scale in The City, but came head-to-head against the exclusivity deal San Francisco signed with Motivate.

Reading the tea-leaves, San Francisco officials speculated Jump’s letter may be some sort of pre-emptive action before an expansion. Supervisor Aaron Peskin, who authored San Francisco’s dockless bikeshare regulatory structure, said it wouldn’t surprise him.

“Judging from Uber’s behavior in the past, one might assume they’re going to dump a bunch of stationless, dockless bikes all over the world in a bid to compete and wipe out Motivate,” Peskin said.

“I would not encourage Uber to go that route in San Francisco,” he said, adding that regulations clearly require permission from SFMTA to do so. “They’ve got to ask for permission rather than forgiveness.”

The current bikeshare landscape is a little messy: Motivate objected when the San Francisco Municipal Transportation Agency moved to give permits to JUMP in late 2017, and entered into arbitration that led to JUMP being awarded only a limited contract to launch a small pilot program here.

Meanwhile, Ford GoBike may soon be rebranded, as Ford is pulling its branding and backing, according to news site Axios. Motivate, which runs the Ford GoBike program in the Bay Area, was purchased by Lyft in July last year. JUMP, a dockless bikeshare company, was also bought by Uber in the spring last year.

So although on the surface this is a battle of bikeshare companies — JUMP versus Motivate — this is also a battle of the bikeshare companies’ owners — Uber and Lyft, respectively.

The MTC helps administer the Motivate bikeshare program and brokered agreements for it with various Bay Area cities.

The argument from Jump’s attorney to MTC is a simple one: Ford GoBike has an exclusive agreement to run “docked”-style bikes, which are parked in stations, not “dockless” bikes, which are parked anywhere and unlocked by smartphones, which is how JUMP’s bikes operate.

He also argued that the agreement doesn’t pertain to electronic motor-assisted bikes, like JUMPs.

“Any exclusivity granted to Motivate was simply in the name of operating a single dock-based system, not in granting Motivate monopoly rights it could use to prevent any bikeshare competitor from operating in the Bay Area,” Linderman wrote.

Jump and Motivate declined comment for this story. MTC did not comment by press time.

Peskin said that while he does not know all the particulars of Motivate’s contract, he believes there “is indeed legal uncertainty” over whether or not Motivate’s exclusivity contract bars dockless bike programs from expanding.

“I think they’ve got an argument,” Peskin said. “Whether or not it’s an argument that withstands legal challenge, I have no earthly idea.”

Jason Henderson, a San Francisco State University professor who studies urban mobility, likened the contract quarrels to the bygone days when private companies like the Market Street Railway Company vied for control over The City’s mass transit system.

“This is the franchise squabble you’re going to have,” Henderson said. “Before Muni, one company would go bankrupt and one company would buy another.”

Henderson said the frequent boom, bust, and acquisition of various tech mobility companies shows a need for a publicly-run bikeshare program linking suburban areas and public transit stations. Such systems exist in Amsterdam and Copenhagen, he added.

“It’s not that utopian,” Henderson said.

joe@sfexaminer.com

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