When you think of New York City, a host of images often comes to mind: the Empire State Building, the Statue of Liberty, the billboards of Times Square, and probably somewhere in that collage you’ll see the iconic yellow taxi.
When I first lived in New York over twenty years ago, the streets ran with gold. Every other car was a yellow taxi. These days, it feels like it’s 1 in every 20 or more cars is a cab. Uber, Lyft, and privately owned cars make up the vast majority of the traffic to the point that you often wait not for a taxi that’s available, but to catch sight of a yellow cab at all.
It’s an amazing transformation that we barely appreciate because it happened over time. The other massive change to the city that we don’t fully appreciate is the rise of cycling. Riding a bike in New York was a health hazard twenty years ago. There were films about how bike messaging was a daredevil occupation. Bike lanes were nonexistent, and only the insane would cross the city on two wheels.
That has all changed. Dedicated bike lanes are now everywhere, with signage directing bikers on the best cross-town streets. This has happened largely because of Citi Bike, Launched in 2013, with a sponsor in Citibank and later in Lyft, Citi Bike has transformed New York into a truly bike-friendly city. And it’s impossible to imagine this working if competition were allowed into the space. Citi Bike has a monopoly on bike rideshare in New York and that’s a very good thing.
Competition and monopoly are words that come loaded with emotional bias. Competition is good and monopolies are bad. I think the simplicity of this blinds us to how useful each can be in different ways. Healthy competition usually involves separate niches. Imagine two competing power grids, both supplying juice to your home, with double the number of incompatible outlets around your house. The waste of deploying this infrastructure would not make up for any downward pricing pressure. But now think of a solar company moving in to add panels to new and existing homes. Same kind of service but completely different infrastructure.
The same is true for wireless communication versus wired. Nothing was more wasteful than several companies laying fiber and coaxial to every home in the late 20th century. Real competition came when that same service could be transmitted from towers wirelessly. We often think competition needs to come from similar looking things, but it’s better when it looks completely different while serving a similar need. Instead of laying train tracks parallel to existing train tracks, those tracks are regulated while cargo also flows on interstate highways and via cargo ships. Same service but different niches.
Bike rideshare wouldn’t work without standardization. You need every bike to fit in the same docking stations. And you need to know that your destination will have a docking station nearby. Compare the bikes in New York with the electric scooters in LA. Without a contracted monopoly, LA has descended into chaos instead of building out a reliable, standardized system of scooter rental. You need to have three or four apps on your phone to use whatever happens to be lying around. There’s no reliability of pick-up location. Allowing “market forces” to arrive at a solution is laughable compared to the union of corporate monopoly and government regulation in New York, two dirty words that instead bring unique benefits.
The only way to transform a city into a biking utopia is with just such a union. You need to re-zone streets and existing infrastructure, turning parking spots into bike lanes. You need signage and dedicated bike traffic lights. You have to put in underground power for docking stations. And you have to commit to long-term contracts with a single operator instead of confusing the market with multiple entrants. Government and corporation working together in New York absolutely destroys laissez faire and tech companies working via anarchy in LA. The difference is staggering. And yet the common refrain is that government and absence of competition are problems.
There are over 30,000 bikes in the Citi Bike program now, with expansions into all boroughs and New Jersey. E-bikes have been added, and they are a blast to ride. On top of this new biking infrastructure, the delivery network in New York has completely changed. A frequent sight in the city now is a worker on an e-bike delivering food. The difference is felt in your home when you order in — cuisine arrives at your apartment almost as fast as it would arrive at your table in a restaurant.
It’s easy to imagine a future New York that looks a lot like Amsterdam. New York is a flat city with mild winters and a dense population. Grabbing a bike is already the best way for getting to most places on most days. It’s helping the city get greener, helps us get more exercise, and it’s an absolute blast on date nights or just running errands with my wife. None of it would work without embracing a single entrant and allowing them to keep their exclusive contract. It feels like these examples are everywhere around us, but we cling to our notions of what works and what doesn’t on an emotional level, rather than a rational one.