China bike wars drive Didi, Tencent into rival camps

Bloomberg

Didi Chuxing may be going up against its own patron, Tencent Holdings Ltd., by picking a rival side in China’s cut-throat bike-rental industry.
China’s largest ride-hailing service said on Thursday it has integrated Ofo’s service into its own mobile app, granting the startup access to some 400 million users across 400 Chinese cities that use Didi to summon cars and taxis. That pits it against Tencent, a prominent backer of Ofo’s arch-rival, Mobike, as well as Didi itself.
Didi, which is said to be closing a funding round of at least $5 billion as soon as this week, will allow users to rent Ofo’s bright-yellow bicycles from within its popular app.
That’s the first step in “extensive” future collaboration as the ride-sharing giant promotes Ofo’s name across China, Didi said in a statement. The arrangement mirrors the way Tencent’s WeChat — China’s most popular social media service — integrated Mobike’s service into its wallet interface in March.
“It seems that Didi and Tencent have an interesting relationship here,” said Zhou Xin, an internet consultant at Beijing-based Trustdata. “It might do the industry some good though by having two large rival companies, which can drive more momentum and quicken expansion.”
Formally known as Beijing Bikelock Technology Co., Ofo has adopted Didi’s take-no-prisoners approach.