Pricing Details Start to Solidify For July Bike-Share Launch

The general shape of the pricing scheme for New York’s bike-share system — an annual membership cheaper than a monthly Metrocard, according to the early buzz from DOT — has been floating out there for a while. Now, with the system set to go live in July, the details are starting to get nailed down.

Speaking at the New Amsterdam Bicycle Show last weekend, DOT policy director Jon Orcutt revealed the current thinking on how much it’ll cost to use one of the 10,000 public bicycles soon to appear on the streets of Manhattan and Brooklyn. Doug Gordon moderated the discussion, and he’s got the info on his blog:

  • An annual membership will cost $95.
  • A one-day membership will cost $10.
  • The first 45 minutes of any ride will incur no additional charges to annual members beyond the initial subscription fee.
  • Lower membership levels, such as one-day and multi-day options, will have a shorter “free” ride limit: 30 minutes.

As Gordon notes, nothing’s set in stone until the system goes into operation. Also, both Washington, D.C. and Boston have offered online deals to price-conscious consumers who passed on the first wave of sign-ups.

New Yorkers anxious for bike-share to move from concept to reality should be getting an even bigger treat shortly. The preliminary map of all 600 station locations is expected to be posted online in the very near future.

  • Larry Littlefield

    What’s the marketing plan?

    I suggest direct mail to MetroNorth, LIRR and New Jersey Transit riders with their monthly tickets, announcements on the trains and the Staten Island ferry, and attempted distribution through high schools and colleges around the metro area.

  • James

    $10 for a day pass is absolutely absurd. In London it’s 1 GBP (about $1.62). There’s no justification for soaking tourists for $10 and it will only lead them not to use the system. That’s $40 for a family, and at that price, it does start to become cheaper just to transit/taxi, etc.

    The other thing is that unlike business people/commuters, tourists go in all directions — so tourists can help redistribute bikes (i.e. bring a bike back to Penn Station after rush hour in the AM has made them all disappear, go from Brooklyn to Manhattan at night when docks are full because all the Brooklyn people have returned home from Manhattan). Yes, this matters, because even with money put into redistributing bikes, the system is not perfect, and at the margins of the system, you will always have full/empty docks depending on commuting directions.

  • Zulu

    45 minutes should give most people a 7 to 8 mile range. What happens after that? What’s the rate for going over the 45 minute allotment?

    I agree with James, $10 a day sounds high but they did agree to not fight for the same market share that current tourist bike rentals have. If you make it any less than those guys will loose their business.

  • 45 minutes is 50% more time than annual members get with Hubway in Boston and Capital Bikeshare in DC. It will make bike-share a realistic commute option for many people who live in the service area.

    Having tourist users subsidize regular users is also a fine, progressive idea. Someone who just paid hundreds of dollars to fly into NYC, plus $45 cab fare to Manhattan, should not have a problem paying $10 for a whole day of bike-share trips. As a resident of NYC, I’m thankful for their contribution to the system.

  • KillMoto

    In Boston (where a tourist pass is $5), you can take out two bikes.  If NYC does the same thing that will cut the $40 family of four fare in half. 

  • Driver

    As someone who wouldn’t use this enough to justify the yearly cost, the $10 daily cost is not justified by the use I would get out of a daily pass the few times it might be a convenient option.  This occasional user has been priced out.

    As far as not competing with the bike rental shops, this could be accomplished by making it expensive to keep a bike over 45 minutes, rather than charging so much just to access a bike for short trips. 

    With regards to marketing, a promotional trial would be a good idea, offering a one time monthly rate at the equivalent price of the yearly rate.  That way people don’t have to pay the full annual fee to then find out the system doesn’t suit their needs. It should be easy enough to offer each person one trial since it is a credit card based system.

  • Driver

    As someone who wouldn’t use this enough to justify the yearly cost, the $10 daily cost is not justified by the use I would get out of a daily pass the few times it might be a convenient option.  This occasional user has been priced out.

    As far as not competing with the bike rental shops, this could be accomplished by making it expensive to keep a bike over 45 minutes, rather than charging so much just to access a bike for short trips. 

    With regards to marketing, a promotional trial would be a good idea, offering a one time monthly rate at the equivalent price of the yearly rate.  That way people don’t have to pay the full annual fee to then find out the system doesn’t suit their needs. It should be easy enough to offer each person one trial since it is a credit card based system.

  • Bike Share Fan

    You can check other cities for an estimate of fees associated with going over the initial usage period.

    Boston:

    http://www.thehubway.com/pricing

    DC:

    http://www.capitalbikeshare.com/pricing

    Returning the bike up to 30 minutes late isn’t too bad; it’s generally just another $2.  But it only takes a few hours before your $10 casual membership can turn into a $30 or $40 bike trip. That’s a big incentive for people to rely on rental companies for longer trips.

  • James

    @ebb4035fe30f2d00466ce7ea0b9e7e07:disqus I see your point, but even at $1.62 for a day pass, the rental bike guys would still make money, because most tourists don’t want to be stuck worrying about the half hour + fees, which get expensive real fast.

    @SB_Driver:disqus Exactly! It is as if the bikeshare folks are just treating the day pass as something that tourists, but not regular New Yorkers, would be keen to use. In London, where the day pass is just 1 GBP (as compared to 1.35 on Oyster for a bus journey or 2 on Oyster for a Zone 1/2 tube ride), the bike share can make for a really cheap commuting option for the Londoner that needs to use ‘public transportation’ just part of the time. New York seems to be telling New Yorkers in regard to bikeshare: go big ($95) or go home.

  • Anonymous

    I’m a little confused by the pricing myself.

    Regular bike commuters already own bikes and are probably not interested in an annual membership for the occasional convenience.  However, at $10 a pop, I don’t see this as a substitute for a short taxi trip.

    I guess there should be a subset of commuters for whom transit gets them within a couple miles of their destination and then bike share makes sense to cover the remaining distance.  I could see some people using it to get crosstown in Manhattan because they arrive at penn station and need to get to the east side, or vice versa.  Although you have to be a fairly confident rider to navigate midtown at rush hour.

    The $10 rate for daily/single rides makes this perhaps a novelty for tourists or very occasional users, but prices it above what most equivalent trips would cost in a taxi or livery car.

  • Driver

    Ben, your breakdown of regular users and tourists ignores a large segment of people who live in this city, particularly in the outer boroughs.

  • Michael

    $10 for a one-day pass when thinking about cab substitution isn’t outrageous.  Taxi fares are $2.50 base + $0.50 MTA = $3.00 plus an additional $1.00 peak surcharge (M-F 4 to 8 PM). With tip, I rarely go anywhere in Manhattan for less than $10.00. 

    Also, I believe you can use the bikes multiple times in one day, as long as you don’t exceed the 30 minutes.  Not bad from my perspective.

  • Anxiously Awaiting Bike Share

    The 45 or 30 minute limit is a bit of a non-limit because you can plug in and plug right back out at any kiosk.  It just makes sure that users are using the bikes or docking the bikes rather than parking them at a non-dock.

  • Driver is right: at $10 a day New Yorkers are priced out of casually experimenting with practical cycling. The rate is off the charts of bike share daily rates around the world. What are they thinking? Whose decision is this?

  • @SB_Driver:disqus @n8han:disqus The point I was responding to was that the daily rate will soak tourists. 
    As for the daily rate being a barrier to entry for people who don’t want to put up the whole $95 all at once, the city clearly has plans to help mitigate this cost. Doug wrote about the NYCHA partnership to let people pay in installments. I’m sure there will be discounts and promotions and the like once it’s up and running, as well as monthly passes that probably cost less than a weekly Metrocard. I just don’t see cost keeping away potential regular users. The subscriptions are going to be the cheapest transport in NYC except for walking.

    For people who would end up using the system two or three times a month (or less), then it might not be worth it to get a yearly subscription, and the daily rate will stink. The system won’t work for this group. It also won’t work for the millions of city residents who don’t come into the service area on a regular basis at all. Hopefully after a few years the city will feel like spending public money on bike-share expansion is worth it, and the system will be useful to more people. But given the basic constraint that the administration has laid out — the system has to pay for itself — the relatively pricey daily pass seems like a smart move to me. Let the tourists subsidize the locals.

  • vcnt

    i don’t know who came up with this ridiculous non-compete clause with the lobbyists for the powerful tourist bike rental cartel, but i really think that’s got to be put way way way at the bottom of the list of priorities if this thing’s going to work. the system needs tourists, and (certain) tourists will want to use the system. you’re gonna eff this up if you allow incumbent business interests to dictate the terms. 

    i’m a former nyc resident, originally from the usa (i.e., not nyc), now living in europe. i could be wrong but i’m guessing that the tourist population visiting nyc at any given time is made up mostly of europeans and our fellow (i.e., “real”) americans. on both counts, people like me. your average european tourist will probably be less price sensitive generally, but on the issue of public bike share programs, you have to consider the context: almost every major european city i’ve visited has bike share programs that are so cheap as to be considered essentially free. i think there’s a tacit understanding here that we want to encourage bike use, and the authorities express this encouragement through pricing. the hierarchy, from cheap to expensive, is always something like: walk<bike<bus/metro<train<segway<car<air. i think this is as it should be. if you don't make this explicit in the pricing, you alienate euro tourists, who would otherwise be among your most avid tourist users — because they're generally already down with the idea. your average american tourist, on the other hand, will be more like an american in europe: generally appalled at the price of things, and suspicious that everything is set up to bilk you out of your walking-around money. without a clear price signal that, money-wise, this is the smart way to go, the more adventurous and "do as the romans do"-spirited member of the tourist family or group will not be able to convince her companions to hop on a bike.

    if what is controlling these decisions is this "must pay for itself" consideration, you have to also think about the way levels of adoption and use will impact the ability for the system to survive at all. if few people use the bikes, the system will be seen as a boondoggle and fodder for anti-sdk people to justify tearing out the bike lanes post-bloomberg. if the bikes are being used a lot, if they become integrated as a ubiquitous feature of the landscape and nyc experience, then this will only self-reinforce: more popular, more users, justifying expansion and more investment in bike infrastructure. pricing influences behavior (remember congestion pricing?) … make it cheap.

  • KillMoto

    It’s actually a wonderful precedent to set – assuming the “it must pay for itself” does not kill the program entirely. 

    Imagine being able to say “motorists must pay the entire cost to support themselves – no longer will we tolerate the socialist, income/sales/property tax subsidies for driving, road construction, maintenance and snow removal must now be funded by bridge tolls and gas taxes!”  Bike share pays it’s own way, why not ‘street share’?  Motorists, buck up!

    What a great day that will be.  

  • RegularRider

    You all seem like a bunch of Chicken Little’s to me. In DC, I believe that the one day rental is $7. Friends were just down there for a visit and used it for about an hour and a half. I believe they ended up paying $16. $7 + free time + first 30 minutes + second 30 minutes. They seemed pleased as punch.

    Re the bike rental guys, bike share is going to be so much more convenient that I don’t think that they really compare for short trips. If you’re going to do an all day rental, definitely the bike rental guys make more sense. But that’s intentional.

    As a man who rides for exercise and transportation in this city and owns 2 bikes, I can say that I can’t wait to buy a yearly membership pass. 45 minutes is enough time to get from midtown to my place in Brooklyn. And it’s more than enough to get to Wall St., etc. For days like yesterday where it rained in the morning and I would not bike to work, I would be able to bike home for 26 cents.

    Yes. 365/$95 = a quarter a day. Totally worth it. Biking is the best way to get around the city and if bike share is done well it is going to shrink the size of Manhattan down to an even more manageable size.

  • > The point I was responding to was that the daily rate will soak tourists.

    This assumes the tourists are willing to be soaked. If that’s what this is really about, then we’re talking about setting a daily rate to maximize profitability. I think that the highest daily rate on earth, 6 times higher than London’s, is too high. It doesn’t seem to be based on anything. Maybe $50 a day is the right number? Who knows!

    It would be more tactical to start at a price closer to the international norm and raise rates if demand is overwhelming, instead of risking a slow start and bad press. The Post will not hesitate to say they told you so and bike share can’t work here, that new New York isn’t London or Paris—ignoring the fact that someone (who?) insisted on charging a daily rate that is several times what Londoners and Parisians enjoy.

    Worse that that, I don’t know that maximizing profitability is what this is really about. The $10 daily rate is such an outlier that I’m left wondering if it isn’t an effort to protect existing bike rental businesses from having to evolve. This is why it’s important to know who’s setting the rates. If it’s Alta, fine. I expect they’ll need to lower them but it’s their business. If it’s the city, it’s our business.
    > As for the daily rate being a barrier to entry for people who don’t want to put up the whole $95 all at once, the city has plans to help mitigate this cost. Doug wrote about the NYCHA partnership to let people pay in installments.When you start talking about paying for bike share on an installment plan, you’ve lost the argument. Not with me but with the people who might try urban cycling on a whim.> I’m sure there will be discounts and promotions and the like once it’s up and runningEveryone else just charges a simple price to use a bicycle. New York’s gotta have installment plans, discounts, and promotions—$5 off a ticket to the Lion King, perhaps? Comes with a bagel?> I just don’t see cost keeping away potential regular users. The subscriptions are going to be the cheapest transport in NYC except for walking

    Yes, only once they are sold on it. The unconverted need to use it a number of times before deciding to plunk down a $100 for a yearly pass. So maybe we’ll have special “bike share discount daze”, on which it will probably rain. And coupons to be handed out on the street, because New Yorkers love clipping and using coupons for daily transport. Let’s see how complicated we can make this, maximize the glitches and overhead costs.

    Or, we could just charge a flat, fair daily rate, like the more successful systems have done.

    And RegularRider, if you’ll please avoid conflating well-intentioned criticism with cowardice, I’ll avoid conflating uncritical support with being a friendly city bureaucracy’s lapdog.

  • Nathan, you are generally insightful, but I think you are jumping to conclusions on this issue. 

    Apparently someone at Alta thinks that enough tourists are willing to spend ten bucks a day for the experience of riding a bike-share bike around. Considering the number of troglodytes posting on other websites who wouldn’t get on a bike in New York if you paid them $100 a day, I think that Alta’s pricing decision represents a cultural shift (perhaps even a ‘tipping point’!) toward recognizing that bicycling in NYC is pleasant, safe and fun enough that people would pay in the double digits to do it.

  • Nathan, what’s the magic price point for appeasing the New York Post?  What sign-up rate will convince them that bike share is off to a smashing start?  They’ll hate it no matter what until they see that it’s immensely popular.  Then they’ll pretend that they loved it from the start.

  • bill b

    Will there be a lower membership rate plan for senior citizens and at what age would  it start  . 

  • RegularRider

    “Or, we could just charge a flat, fair daily rate, like the more successful systems have done.” Surely you don’t mean more successful than NYC’s system, which isn’t up and running. Why don’t we leave the armchair economic analysis behind and let the professional bike share operators price the system appropriately?

    IMO (one who rides >200 miles/week and owns 2 bikes already), bike share is a game changer. If people think that $95 is too much, then they won’t use it until enticed with promotions, or whatnot. Personally, I can’t wait to plop down my money and ride these new bikes.

  • Driver

    RegularRider, I think the issue some of us are trying to address is the disparity between the value of the daily rate vs the annual rate, as well as the large geographic area that likely won’t be serviced by bikeshare.  The $95 rate is a great deal…IF one can make regular use of the bikes.  It is not a great deal for people who doesn’t live or work near the primary service area and who might use the bikeshare only occasionally. 
    The $10 daily rate is ridiculously expensive compared to the annual rate, I’m sure we can all agree on that.   I’m sure many tourists will be willing to pay it, in the spirit of a vacation, it is just another expense, but there are many NY’ers who won’t be served locally by the system.  Many of them will not justify an annual membership for occasional use, but why should the use of the system be so costly for them if they want to use it?  We should really want as many NY’ers to use bikeshare as possible, not just those living in or commuting to jobs in Manhattan and DT Brooklyn.  If we want bikeshare to be well received by all NY’ers, it doesn’t make sense to price out the locals who are already not served by the system. 

  • Driver

    RR, it doesn’t cost you 26 cents to bike home unless you use the bikes 365 days of the year. 

  • Andrew

    It’s not about the tourists.

    Most New Yorkers won’t sign up for the annual membership – either bike share won’t be of use to them on a regular basis or they’re satisfied with their current modal choices. But they may still occasionally find themselves in situations where bike share would come in handy.

    Do you want them to give it a shot? Or do you want them to notice the absurd disparity between the daily and annual membership rates – an annual membership selling for under 10 times a daily membership, or a day’s worth of riding costing 38 times more for a daily member than for an annual member?

    And to add insult to injury, the daily users will only have 30 minutes of riding – 33% less than annual users – before additional fees kick in. (They aren’t paying enough already?)

    Don’t you think some people might resent that they, as occasional users, are subsidizing regular users to such an extent? I don’t think we need to fuel another bikelash.

    Say the MTA were to propose a new annual MetroCard costing only $800, but the cheapest option for the occasional user were an $84 daily pass, not valid for long trips (but it’s OK, you can get off the train, leave the station, and reenter). Would you consider that a great deal, because $800 is a bargain for a year’s worth of subway rides? After all, only tourists would pay the $84, right?

  • James

    The only reason I started using bikeshare in London is because I felt it was worth it one night to give it a shot for £1 ($1.60) — less than the cost of taking the bus for an entire 24 hours of service. Now I have a key £45 ($73) and use the system more regularly. Were it not for the low initial price, I would have never ordered a key. I hope those supporting the $10 extortionate price realize that the system will lose money as those who are unwilling to purchase a key without first having a chance to try the system will inevitably be put off by the $10 daily price and never try the system at all. Bikeshare users take pressure off of crowded, streets, subways and buses — this good behaviour should be incentivized with low, subsidized rates (bikeshare is public transportation and shouldn’t be expected to be self supporting in a way that buses or subways are not), not punished with extreme rates.

  • “Apparently someone at Alta thinks that enough tourists are willing to spend ten bucks a day…”

    Jonathan, it’s not apparent. That’s the problem. No one seems to know exactly who is setting the price. As I said before, if it is indeed Alta: fine. But it’s funny how the subject of established bike rental business keeps coming up, and not just by newly branded conspiracy theorists like myself.

    “Nathan, what’s the magic price point for appeasing the New York Post?”

    Doug, that’s not very nice. You make it sound like I want a low price to please the Post. But you know I want a world-normal daily rate so that the program is obviously popular from the get-go, and then all of our crappy papers have no choice but to admit it.

    I was hoping for a $3 daily rate. That’s still higher than London and Paris, but we always have to have things a little worse here. $5 would have been in line with my cynical expectations. But $10 is just silly. Good luck with it.

    “Surely you don’t mean more successful than NYC’s system, which isn’t up and running.”

    No RR, I mean as compared to the up and running, small and expensive American systems that some people are cherry-picking to make New York’s daily rate sound slightly less wild.

    “Why don’t we leave the armchair economic analysis behind and let the professional bike share operators price the system appropriately?”

    How I love a good argument from authority. Since we don’t even know who’s pricing the system, I can’t know which all-knowing authority to bow before. All I know is they aren’t well clothed.

    “Personally, I can’t wait to plop down my money and ride these new bikes.”

    Guess what? Me too!

    $95 a year is a bargain for people like me who live in the covered area and already cycle every day—but our choice has no bearing on if the daily rate is too high. For whatever reason, it’s being set high enough to make bike rentals seem cheap, leaving only the most contrived scenarios where a day of bike share would be a sensible purchase.

    The program will open with thousands of units and true believers like you, me, and others (hundreds?) will eagerly plop down $95 for a yearlong pass. Locals and tourists with money to burn will try it at the daily rate, for a lark. And then we’ll wait. Next winter should be fun.

    I still think bike share will succeed here, but I can’t think of a better way to fend off that success than to start with a record-high price of entry.

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