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Ask HN: Explain Bird and Lime to me

1 points by microdrum 8y ago

Because it seems tome that their pricing is temporarily perfect. Sort of like Earth's distance from the sun. The Xiaomi scooter is rare in the US and somewhat expensive ($400). It it a novelty. And last mile transportation is expensive because it's humans being paid (Uber). Super expensive, although eventually made robotic. So, OK, SF, richest city in the entire world, can pay $1+$0.15/mi for a Bird/Lime/Whatever. That price will halve in any other market. That price will more than halve as more entrants saturate any given market. There is nothing proprietary in the scooter itself. At the same time, the cost of an Uber trip will also halve over a slightly longer timescale. Also at the same time, the Xiaomi scooter will undergo Moore's Law, and eventually will be $100 to have your own personal scooter, and it will last for more than 100 trips. It looks like these companies are threading a needle that is getting constantly narrower.

microdrum 8y ago
To sum up what I'm asking about: why won't competition and many even larger outside factors conspire to reduce the market price of a scooter ride to what it probably should be....like $0.50+$0.10/mi or something? If that is what ends up happening, we'll just have thousands of little local scooter shops. Like all bike rental shops.
- spikels 8y ago
  The beauty of Bird/Lime is that you just grab one when need one then leave it at your destination. For this to work you need lots of scooters/users. The more users/scooters the better the services becomes. This situation where the more sales/users the better the quality becomes and the lower the cost/price becomes is known as the "network effect". This is what drives the incredible value of things like Facebook and to a lesser extent Uber/Lyft. You can't really replicate this by buying a personal scooter because they are heavy and bulky. And you can't replicate this with "thousands of little local scooter shops" would be extremely expensive (real estate and labor) and add little value. And you can't replicate it with even driverless cars because they will be much more expensive and subject to congestion and other constraints. Lastly if scooter prices did come down the service would just become cheaper to provide but all the advantages would remain. So despite your numerous agruments against the business it seems plausible that a Bird/Lime scooter network would makes sense versus alternatives and likely that a single business could capture most or all of a market. They would then enjoy a sustainable quality/cost advantage over potential competitors. Make sense? More info on the underlying phenomena here: https://en.m.wikipedia.org/wiki/Network_effect https://en.m.wikipedia.org/wiki/Network_effect

1 points by microdrum 8y ago

microdrum 8y ago

To sum up what I'm asking about: why won't competition and many even larger outside factors conspire to reduce the market price of a scooter ride to what it probably should be....like $0.50+$0.10/mi or something? If that is what ends up happening, we'll just have thousands of little local scooter shops. Like all bike rental shops.

spikels 8y ago
The beauty of Bird/Lime is that you just grab one when need one then leave it at your destination. For this to work you need lots of scooters/users. The more users/scooters the better the services becomes. This situation where the more sales/users the better the quality becomes and the lower the cost/price becomes is known as the "network effect". This is what drives the incredible value of things like Facebook and to a lesser extent Uber/Lyft. You can't really replicate this by buying a personal scooter because they are heavy and bulky. And you can't replicate this with "thousands of little local scooter shops" would be extremely expensive (real estate and labor) and add little value. And you can't replicate it with even driverless cars because they will be much more expensive and subject to congestion and other constraints. Lastly if scooter prices did come down the service would just become cheaper to provide but all the advantages would remain. So despite your numerous agruments against the business it seems plausible that a Bird/Lime scooter network would makes sense versus alternatives and likely that a single business could capture most or all of a market. They would then enjoy a sustainable quality/cost advantage over potential competitors. Make sense? More info on the underlying phenomena here: https://en.m.wikipedia.org/wiki/Network_effect https://en.m.wikipedia.org/wiki/Network_effect