Simon MacMichael October 3 2017
The Chinese internet giants behind Ofo and Mobike are in preliminary discussions to merge the two dockless bike-sharing businesses, reports Bloomberg.
Alibaba, which backs Ofo, and Tencent, a major investor in Mobike are said to have held early-sateg talks regarding issues such as how equity in a combined business that could be worth $4 billion would be split.
According to Bloomberg, combining their operations would bring to an end their fierce rivalry in China and enable them to focus on their continued international expansion.
Having each deployed millions of bikes in their home country in recent years, both Ofo and Mobike are now rolling out operations worldwide at a frenetic pace, including in the UK.
Ofo began a small-scale trial in Cambridge in April and has since grown its presence in the city as well as launching in Oxford, while Mobike began operating in Manchester in June.
Both now operate in London, prompting Transport for London last month to introduce a code of practice for dockless bike scheme operators in a bid to avoid issues such as vandalism and the dumping of bikes that have proved problematic in cities where such schemes have been launched.
Unlike local authority-run bike-sharing schemes that typically involve docking stations, dockless schemes require users to download an app to their phone, which enables them to unlock the bike they wish to use and means they can simply leave it at their destination.
It’s no coincidence that both Ofo and Mobike are backed by firms that have grown to become among the world’s largest internet-based companies; for all the PR about wanting to change the world by making it easy and convenient for people to hire bikes cheaply, data mining is an essential part of their business model.
While Ofo declined to comment on the Bloomberg report, Mobike said that there were no plans to merge the two businesses.
It said: “Mobike is the clear leader in the global bike-sharing industry, supporting 30 million rides in 180 cities around the world every single day.
“We are fully focused on extending our global success,” the company added.
Bloomberg points out that it would not be the first time Alibaba and Tencent had partnered, with the businesses having previously merged their separate ride-hailing operations to create Didi Chuxing, which led to Uber leaving the Chinese market.
As for a name should the merger go ahead, we reckon ‘Mofo’ has a nice ring to it – though San Francisco-based global law firm Morrison & Foerster, which has the domain name mofo.com and uses MoFo as the shortened version of its name, may have a word or two to say about that.
“In many ways, the MoFo nickname is an affectionate reminder that while we are very serious about our clients’ work, we don’t take ourselves too seriously,” the firm says on its website.