Digital mobility graphic

A smoother ride: how technology is disrupting travel

Image credit: Diomedia

The biggest new game changers in transport don’t have wheels; in fact, they don’t even move. What are the innovations that will change how we travel around cities?

“What would make you give up your car?” That’s the seemingly simple question at the heart of Sampo Hietanen’s work. Hietanen is CEO of the world’s first Mobility as a Service (MaaS) company, MaaS Finland Oy, having recently left the same role at Intelligent Transport Systems Finland, which was instrumental in managing Helsinki’s transition towards a disruptive new model of urban mobility.This disruption looks a little different from the hoverboards, Hyperloops, manned drones and driverless cars that have dominated transport news in the past year. Google may have announced it has self-driven over a million miles since 2009, but there is a quieter transport revolution taking place that deserves far more attention.

“We’ve been getting the debate on transport wrong,” Hietanen says. “For the end user, it’s not just about getting from A to B, it’s about all the As and all the Bs.” This isn’t a sound bite; it’s hard-won knowledge from a man who has spent an awful lot of time thinking about urban transport. His point is that cars offer a great solution not just for a single journey, but for most journeys. Nevertheless, cars also sit unused for 95 per cent of their lives. If cities can digitally integrate other transport systems to the point where they compete with the convenience of a car, huge gains in productivity can be made, while reducing congestion and pollution.

In some respects, the controversial rise of Uber has highlighted some foundational principles for future transport services. One key point is that user experience is paramount - users should be able to navigate simple app interfaces and book transport with a minimal number of button presses. The scale of operation is also really important: “Transport service coverage is similar to the telecoms sector; you have to start off big,” Hietanen points out. “You can’t start a mobile telecoms operation with two masts and promise to erect another one when you have more customers.”

These are the types of lessons a private firm like Uber learns fast if it wants to increase its market share, and Hietanen agrees that the elements at the heart of their growth will continue to underpin successful examples of MaaS – he should know, he is one of the founding fathers of the concept.

Starting potential

The market potential of selling MaaS shouldn’t be underestimated. “Average consumers in developed countries spend close to €500 per month on transport costs, so the average revenue per user is potentially high for operators who can provide a complete door-to-door service,” Hietanen explains. “By contrast, the average revenue per user in mobile lies below €30, which means the potential market for MaaS could be significantly larger than mobile’s vast trillion-dollar global market.”

It’s not hard to imagine automated electric vehicles playing a big part in the MaaS space. If cars represent a good transit solution now, sharable, autonomous incarnations will likely prove even more appealing to younger generations less interested in ownership. In combination with improving energy efficiency of the batteries powering these vehicles, issues of city-centre pollution and congestion could be wiped out at a single stroke. Nevertheless, there is still a long way to go before automated electric vehicles become ubiquitous in our cities. In the meantime, the push to integrate existing public and private transport services is gathering pace.

The ‘multimodal transit platform’ is one key element in successfully integrating transport services. The concept originally emerged from the haulage industry, whereby one operator manages the movement of goods using multiple modes of transport. Applying the model to human transport makes a lot of sense and companies such as Siemens and GlobeSherpa have developed platforms that integrate information and ticket-buying services that can accommodate all modes of public and private transport.

“An efficient public transport system is a very sustainable means of transporting people in densely populated areas,” explains Steffen Schaefer, the project leader on Siemens’ SiMobility Connect platform. “However, public transport comes with its own challenges, including complex tariffs, complicated ticket vending machines, and difficulties accessing useful information. Even in the smartphone era, you may need a separate app for each region or mode of transport.”

All-in-one access

Instead of locating, booking and paying for trains, buses and taxis separately, multimodal platforms let travellers plan and book door-to-door journeys from a single app, providing real-time journey information at the touch of a button. Pricing is also changing. We are likely to see a trend towards monthly tariffs for all-inclusive services, as well as pay-as-you-go options. Given the similarities with current mobile phone operators, it’s likely travellers will take to the familiarity of this payment model, as well as the new found convenience it will afford.

Verkehrsverbund Berlin-Brandenburg (VBB) has started providing multimodal transport information in Berlin via Siemens’ platform. The system currently provides location and availability information on 2,500 free-floating and 400 station-based car-sharing vehicles and taxis, as well as hundreds of shared bikes and parking lots. On VBB’s live map this data is combined with public transport data, making it the most comprehensive multimodal website, at least in the region.

One of the most fascinating elements of VBB’s efforts is that combining position sensors, GPS, smart billing and machine learning means the platform will soon be able to provide trip advice tailored for individual users. For many that means speed, so a travel plan may dynamically update your optimal route while ‘en route’ according to the latest information on train delays or traffic disruption; for other travellers, money savings or a picturesque trip may be bigger priorities, so the system will adapt to reflect this over time.

These new platforms build upon another trend that has gained momentum in recent years: the convergence of maps and layered real-time information. While Google Maps has continued its evolution as a multi-purpose product, newer apps like Moovit and Waze (now Google-owned) have already set down benchmarks for integrating real-time traffic data.

“As populations continue to grow, more people will be using public transportation than ever before. There is also a trend towards ‘going green’ that public transit helps to accomplish, with fewer emissions and fewer cars on the road,” says Moovit CMO Alex Mackenzie Torres. “Cities will continue to become much smarter thanks in part to feedback from public transit riders.”

Challenges associated with accessing up-to-date transit data via local agencies or government means new multimodal platforms may need to mimic Moovit’s community-focused data harvesting in regions where it’s not publicly available. “Thanks to support from our Community programme and our proprietary editor tool, we’ve been able to launch the app in over 100 cities where we otherwise wouldn’t have access to the data,” Mackenzie Torres reflects.

An early arrival in the multimodal operator space is Moovel, which incorporates GlobeSherpa, and is now owned by Daimler. Its services have already gone live in Germany and will soon expand into Austria, Denmark, the UK, Italy, the Netherlands, Sweden and Spain. With Daimler’s involvement, there are some questions over whether these early efforts can successfully feed into the type of agnostic blueprint Hietanen has crafted in Finland. Nevertheless, its progress in 2016 should be keenly watched.

Keep the car; take the bike

In short, multimodal transport platforms are starting to improve the options for efficiently traversing cities. They should make travelling a simple and seamless exercise, benefitting anyone with a smartphone, not just those with thousands to spend on a new car. Nevertheless, Hietanen does not see a rapid abandonment of cars as part of the mix, and that is one reason he sees multimodal platforms as just one part of an integrated system: sometimes a car or bike will be the best solution from A to B, and that works fine if the pressure on road space has been eased by alternatives that are equally attractive to other people’s journeys.

The main difference in Helsinki’s approach, compared with most other so-called smart cities in Europe, boils down to its adoption of a market-based approach rather than the typical ‘systems thinking’ approach. This methodology allows room for established and emerging modes of public and private transport. Furthermore, there is no need to build infrastructure from scratch – a significant benefit given how prohibitively expensive and inflexible this can be. In fact, Hietanen’s biggest achievement may well be the successful inclusion of all major transport providers in Finland; without this public and industry engagement, the ecosystem would be incomplete.

One interesting point about this work is that it removes the pressure to create a ‘project’ that pushes people to travel in certain ways; centralised innovation is redirected from addressing the journeys themselves, to novel market design and regulation. With the race now on to build similar ecosystem conditions in other cities, door-to-door travel seems destined to get a whole lot simpler.

Conversations on modern urban mobility seem to inevitably turn to the ‘gig’ or ‘sharing’ economy: the offer of short-term use of services or goods in place of long-term contracts or ownership. However, depending on your definition, the ‘sharing’ label seems to be frequently misapplied. The trend towards non-ownership isn’t always about sharing; many companies are built in a rental model that merely prioritises access (as opposed to true peer-to-peer sharing).

For example, Uber’s model isn’t really about sharing your car when it’s not being used, it’s a cheap and easily accessible taxi service. The company model is focused on raising capital and exploiting its position as leader in an alternative unregulated market to dominate market share and kill the competition.

Airbnb was founded on the idea of sharing spare rooms, but as its popularity has grown and more people purchase property with rental in mind, it too represents something of an alternative unregulated market. A reported $900m in revenue and an operating loss of around $150m suggests the company has taken the same approach to burning through capital in pursuit of market share. It’s a trend replicated by many of the fast-growing tech firms emerging from San Francisco. By contrast, apps like Faxi and BlaBlaCar, which focus on peer-to-peer carpooling, seem a slightly better fit within this ‘sharing economy’ (it should be noted that UberPOOL and Lyft Line side products are now following in these footsteps). Tesla has signalled it aims to join them by, eventually, offering a service that will let owners of its self-driving cars rent them out when they are not needed.

The year of caring about sharing

Against this context, 2016 is an interesting year, not only for the transport sector, but for the sharing economy as a whole. At present, it is unclear whether revisions to national-level governance and regulation will fuel or upset the San Francisco party. Either way, these market disruptors could well see their own models disrupted before long.

For all the technical innovations and pragmatic business models developed by the current crop of app giants, the majority are very similar, combining well-designed ‘new school’ web platforms that focus on convenience, while still relying heavily on ‘old school’ brand recognition as a proxy for trust in an otherwise trustless environment. In return for building these brands, money has flowed upwards to a small group of investors and directors – in some instances, in vast quantities - at the expense of local economies. So are there more equitable approaches for establishing peer-to-peer trust? That’s precisely the question the Israeli-conceived La’Zooz project is trying to answer.

The team at La’Zooz is setting out a roadmap for ridesharing that reflects the foundations of the internet itself: decentralisation. Like Bitcoin, the well-known cryptocurrency, the goal is to put power in the hands of the community and reward those who contribute most. In the context of transport, this means La’Zooz users, developers and backers can all earn cryptocurrency for driving, coding or funding respectively. “The community collectively decides about the reward for each contribution via sophisticated protocols,” the project leaders explain. This community-led reward system is the crucial difference between La’Zooz and companies like Uber: the ecosystem will not ultimately be controlled by the goals of a central profit-orientated group, but by the users themselves.

Creation and distribution of the cryptocurrency are managed using a distributed ledger technology called blockchain – the main technical innovation underpinning Bitcoin. Not only does this make transactions fully transparent, it also allows multiple types of transaction supported by smart contracts. These smart contracts can be used to set out all parameters and conditions of an exchange between peers in advance, and the transactions themselves can be fully automated as soon as proof is given that the contract terms have been met. Although in the case of ridesharing, contracts can also be as simple as turning on your La’Zooz-enabled phone, having your passengers confirm the pick-up and then driving to your destination. The project is still in the early stages, but the blueprint for applying the system in the real world is coming together.

The main obstacle to success for a blockchain platform such as La’Zooz is how to replicate the things San Francisco’s giants do well: attracting investors and building a market. It’s a final, but significant, piece of the puzzle. If someone works out how to market and monetise a platform with no middleman, blockchain will not only mark a significant milestone in internet evolution, it will also help to create a new form of sharing economy into the bargain.

Decentralised data

Blockchain

Blockchain is essentially a digital database that stores data in ‘blocks’. Every time the system is updated, a new block is added, holding a complete cache of information on a transaction from the moment it occurs.

Financial and legal industries are already investing heavily in blockchain technology: among other notable success stories, Chain.com raised $30m from financial leaders at the start of the 2016. This makes sense if you consider that blockchain could potentially wreak the most havoc in those sectors – but may equally provide them with incredible future opportunities. The race is now on to work out the best uses for the ledger outside of the financial and legal sectors.

Slock.it is one of the startups facilitating the Internet of Things’ shift towards blockchain with a broader aim of quickly and securely sharing resources. Put simply, if you can put a lock on it, you can use Slock.it to securely rent it remotely without a middleman. Slock.it’s diminutive home server runs a series of decentralised applications: a Web 3.0 identity vault, a Slock gateway to any Internet of Things devices you may want to connect, and some experimental software including an InterPlanetary File System (IPFS) – a new hypermedia distribution protocol that aims to make the web faster, safer and more open.

Uber self drive

Uber is introducing self-driving cars in the city of Pittsburgh as part of its call-a-car service, with the mission to make transport as readily available as running water: everywhere and for everyone. The company – whose success was initially built on existing spare capacity (car supply and people wanting to drive them for payment) – has seized the opportunity in the potentially profitable driverless vehicle market.

Uber’s Advanced Technologies Centre in Pittsburgh has been running trials with a hybrid Ford Fusion incorporating many sensors including radars, laser scanners and high-resolution cameras, but now it is rolling out a fleet of sensor-equipped XC90 sports utility vehicles through a partnership with Volvo. The full complement of 100 cars is due for delivery by the end of the year. However, passengers can rest assured that there will always be a human driver behind the wheel ready to take control if necessary, as well as expressing forceful opinions on the issues of the day.

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