What’s driving the transportation revolution?

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We are at the beginning of the next big revolution in transportation.

Just look around. New car and bike-sharing businesses are entering the market at an incredible pace, while the anticipated arrival of autonomous vehicles will greatly impact the provisioning of transport services. In short, transport is undergoing a huge transformation as a result of a new wave of technologies and the rise of Mobility as a Service (MaaS solutions).

Transport ministers across the globe are excited about the opportunities this revolution will bring. Just recently, Elisabeth Borne, the French Transport Minister, said: “There is enormous potential in new technological and digital mobility tools that are more efficient and less expensive. [They will] make it possible to travel in a simpler, more sustainable, more practical and safer way.”

But when we consider what’s driving the future of urban transport, I think it’s important that we look beyond the buzzwords. We need to look into the societal and technological trends to see what’s really going on, and to fully understand how we can make MaaS a reality:

1.) The shift to a sharing economy

The way we use technology, today, sits within a wider societal shift away from a culture of owning goods to a digital and sharing economy. Our dependency on smartphones and our acceptance of companies such as Uber and Airbnb has fundamentally changed our expectations for how goods and services should be consumed.

This societal shift is now impacting our attitudes to transportation. Mobility as a Service, or MaaS, describes the idea that we are moving away from privately owned modes of transportation and towards consuming transportation solutions as a service. It’s estimated that by 2030, the value of the MaaS market will exceed $1tn given the benefits on offer.

The promise of MaaS will be enabled by blending both public and private transportation providers across multiple modes of transportation and supplying a single interface for users to manage their trips. However, quality data must play a critical role in delivering a seamless customer experience. Imagine being dropped off at a train station by a ride-sharing service but that train is significantly delayed or cancelled. The MaaS concept quickly falls apart without accurate and timely data.

2.) The millennial movement

Millennials are playing their part in the revolution too. This generation is generally less concerned about the prestige value of car ownership, and are simply more interested in having access to cars. To the younger generation, new modes of transportation like ride-sharing services offer the flexibility they demand. What’s more, the financial gains of MaaS are something that greatly appeals to those aged under 30 years old. According to research from UCL, 55% of this age group would be encouraged to subscribe to MaaS services if it removed the costs associated with car ownership.

3.) Data, data, and more data

In terms of technological change, open data, open systems, and open APIs have all made MaaS possible. Without open systems, the essential bits and pieces aren’t available for developers and entrepreneurs to make use of. The breakneck speed at which autonomous vehicles are coming online, alongside the wider move towards electrification, will also greatly affect the development of MaaS. Underlying all of this is an enormous amount of data that facilitates transactions and the movement of people through shared, rather than owned, services.

4.) Customers demand more

In a world where transport is now available at the touch of a button, public transportation operators are going to have to rethink the way they deliver services. The rigid structure that bus operators, for example, must follow – with its fixed stops, routes, and schedules – needs to be replaced with a much more flexible service: one that enables passengers to get a bus closer to where they are getting picked up and dropped off. This will ultimately offer users a much more seamless, tailored journey.

However, for this revolution to truly take off, many data elements need to come together. One of the key challenges is getting public transportation data to be as complete and accurate as possible to support MaaS solutions. We must supply MaaS providers with transit data that reflects real-life customer experiences as closely as possible. Get it right and the opportunities for both public and private organisations and bodies, as well as cities, are huge.

Author

Johan Herrlin – CEO of ITO World

Johan Herrlin is CEO of ITO World, a fast growing company delivering real-time transit data feeds and data visualisation software for businesses in the transport and mobility space.

Johan is one of BusinessMaas’s top Mobility as a Service influencers, see him here.