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Comment by yellowstuff | Hacker News Reader

Lyft operates Citibike, but it looks like they make less than $1mm per month from membership fees: https://mot-marketing-whitelabel-prod.s3.amazonaws.com/nyc/M.... Not a cash cow!

Members use the bikes heavily, which requires maintenance, and people who drive around Manhattan taking bikes from popular parking spots and bringing them to popular departure spots, and recharging electric bikes. This is very imbalanced, EG everyone wants to go to Grand Central in the morning and leave from there in the evening.

In addition to the marginal cost from each member, Citi bike has high fixed costs, like maintaining the bike docks. My guess is that even at $205 for a membership Lyfy doesn't profit much.

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If the price was $30 per year, I bet you could attract at least 400,000 casual subscribers (in an area of 24M people) and earn the same $12M per year. The more casual users would put less strain on the system too.

I wonder if the report you linked to is somehow broken ("There were 18 active Citi Bike stations at the end of March.") but 2 trips per bike per day sounds comparably low - I guess an annual report would be more useful.

> everyone wants to go to Grand Central in the morning and leave from there in the evening.

Sounds problematic (and weird) to me, like they have attracted only a specific type of potential users.

> If the price was $30 per year, I bet you could attract at least 400,000 casual subscribers (in an area of 24M people) and earn the same $12M per year. The more casual users would put less strain on the system too.

How would having more casual users put less strain on the system?

Lowering the price to $30/year isn't going to cause the people who now pay $200+/year to stop using it, so all those new casual users would be in addition to those already using it.

Good point. Intuitively, if the new casual users would cover the costs of the old users' trips, then the old users would have to cover the costs of the new users' trips. To further increase the average revenue per trip after reaching this balance, you'd continue to attract more signups by casual users.

Whether this is feasible depends on the actual numbers, but at least it does work in other cities.

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