PTOs, are you ready for MaaS?

Written by: Menno de Bell

March 23, 2017 - Why is Mobility as a Service (MaaS) interesting for PTOs, and are PTOs ready?

PTOs, are you ready for MaaS?

What is MaaS

In our digitally enhanced society one after the other ‘as a service’ initiative develops. Spotify turned music into a service. Netflix turned movies into a service. Each of these heavily impacts its respective industry. In this trend, Mobility as a Service (MaaS) reveals itself as a fruit from the same branch. All these initiatives share at least one paradigm shift: “from ownership to usage”. Hence, MaaS consists of car-rental, car-sharing, bike-rental, ride sharing and the likes. Providers of these services ease the consumption through a ‘sharing platform’ which offers flexibility of identification and payment to their consumers. As the biggest taxi company without taxis, Uber flourishes on the same paradigm shift.

Why is MaaS interesting for PTOs

Since consumers already use and not own busses, trams, metros and trains, why is MaaS interesting for public transport operators (PTOs)? This might be answered by a second paradigm shift underpinning the ‘as a service’ trend: ‘from scheduled to on-demand’. Clearly, consumers only demand music and movies when they use them. Equally, consumers only demand mobility when they use them. Demand driven public transport might really disrupt the public transport industry.

However, PTOs do have an issue with the utilization rate of their vessels. In urban areas the usage of public transport often sharply peaks around rush hours causing over crowded vessels. In rural areas on the contrary, busses might drive according to schedule but without any passenger. These utilization issues might be solved by connecting public transport with MaaS.

Urban

Imagine the following business traveler persona, always commuting between home and work during rush hours with public transport. He consumes the first and the last mile of his journey using the bus. The middle and largest part of the journey he takes by train.

The train operator now connects its public transport services to a mobility platform that includes the Uber taxi service. On this mobility platform the train operator creates a combined mobility offering:

  • Outside rush hours
  • The journey from home to the station is with an on-consumer demand taxi
  • The journey from station to work is with a connected taxi service readily available when the train reaches the end station
  • The consumer identifies towards the taxi with the same medium as towards the train
  • The consumer pays for the taxi and for the train after the fact
  • The booking and ticketing of the combined journey is with a single click on a mobile app

The overall service level of this combined mobility offer could attract the business traveler to start commuting outside rush hours.

Rural

In rural areas, public transport faces a different challenge. Often, operators are subsidized and required by the authority to provide a minimum coverage over a region. However, because of the low population density, busses are almost empty outside peak hours. Inhabitants of rural areas are commonly served by a single bus line, showing up once every hour or less. The rigidity of this system inhibits uptake by customers, resulting in a negative feedback loop.

Imagine a bus with a route that can be modified dynamically based on traveler needs, with optional stops that serve people located further away from the regular route. This means that each bus covers more stops, but physically pass by them only when there is demand. This gives operators two options:

  • They can operate less bus lines in rural areas while still providing the same coverage of their transport network, freeing up resources (busses, personnel) for busier areas
  • They can provide better coverage with the same amount of busses. This would open up an opportunity to better connect people in remote places: instead of having access to one static bus route, they could be served by multiple dynamic bus routes

How can MaaS be done

An important aspect of MaaS is the integration of multiple service providers to jointly serve the customer a seamless user experience. Although this integration can be accomplished in multiple ways, we recognize four essential roles in the MaaS ecosystem:

  • The Customer
  • The Mobility Service Provider (MSP), who delivers the actual mobility services to the customer. Because the services of the MSPs may overlap, they are both complements as well as competition to each other. To compete efficiently, an MSP knows exactly the (short and long term) needs of the customer and acts accordingly.
  • The Revenue Collector (RC), who registers the service usage of the customer at the MSPs and ensures the MSPs are compensated sufficiently by the MPP. Transport authorities are well-positioned to take the role of the RC.
  • The MaaS Platform Provider (MPP), who connects demand with supply between the customer and the mobility service providers. On the one hand it retrieves the available mobility services from the MSPs and packages them as combined mobility offerings to the customer. On the other, it also forwards customer service requests to the MSPs.

It is clear that PTOs will naturally assume the role of one of the MSPs. What is less clear is whether they want to take up the role of MaaS Platform Provider as well. Leaving this to a third party means that PTOs will lose an important channel with the customer. However, taking on the responsibility to onboard and connect with other MSPs is a far cry away from the core competence of most PTOs.

To be able to provide on demand services, all processes between the roles need to be automated. Because of the integrated nature of MaaS, interfaces play a large role in this automation. PTOs can strengthen their position by insisting that open standards are used and thereby preventing a lock-in to a specific MPP.  

The best way to see the advantages of MaaS for a PTO is to experience it firsthand by running a pilot with other mobility service providers. This also allows PTOs to explore the merits and responsibilities of the roles in the MaaS ecosystem and gain a better understanding of the technological impact of MaaS on their current ticketing infrastructure.

Recommendations for PTOs to get ready

In response to the MaaS trend, UL recommends PTOs the following:

  1. Decide which role you want to play in the MaaS ecosystem
  2. Automate the processes necessary to execute your role and open up your interfaces to strengthen your position within the MaaS ecosystem
  3. Join MaaS pilots especially where public transport is connected to other forms of transport

 

Disclaimer

These are the personal opinions of UL’s employees and its guests and should not be misunderstood as representing the opinion of UL's clients, suppliers or other relations.