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Transportist: MaaS or SaaM: Mobility-as-a-Service Pro and Con
A collaboration with #ChatGPT4
“There are only two ways I know of to make money: Bundling and Unbundling” — James Barksdale
The concept of Mobility-as-a-Service (MaaS) involves integrating various transport services, such as public transport, ride-hailing, car-sharing, and bike-sharing, into a single, “user-friendly” platform, (an app) typically with a monthly subscription for the bundle of pre-defined services. The goal is to provide a seamless, multi-modal transport experience, reducing the need for multiple subscriptions, multiple apps, and more broadly reducing the number of personal vehicles and vehicle kilometres travelled.
Is this likely to be here in 10 years time, or is it another example of faddism in the transport sector, as people look for solutions that don’t require real political pain (like pricing and taxing policies)? With the assistance of ChatGPT (which is to say, everything that was published before 2021 online compressed into a massive neural network) I (we?) formulate the case in favour and against. Here is what we came up with.
Thesis: MaaS-tering the Future: The Case for Mobility-as-a-Service
MaaS has been gaining traction as a potential solution to address the transport challenges faced by rapidly urbanising populations. Despite some concerns about its sustainability, there are compelling reasons to believe that MaaS can revolutionise urban transport and provide significant benefits to users, cities, and the environment.
Enhanced User Experience and Convenience: One of the main advantages of MaaS is its ability to offer a superior user experience. By integrating various transport options, such as public transit, ride-hailing, car-sharing, and bike-sharing, MaaS platforms enable users to plan, book, and pay for their trips using a single app. This seamless experience can make public transport more appealing and encourage a shift away from private vehicle ownership.
Reduced Traffic Congestion and Parking Pressure: MaaS has the potential to significantly reduce traffic congestion and parking pressure in urban areas. By encouraging the use of shared and public transport options, MaaS can decrease the number of single-occupancy vehicles on the roads, thereby reducing traffic jams and the need for parking spaces.1 As a result, cities can repurpose parking spaces for other uses, such as green spaces or pedestrian zones, improving overall urban liveability.
Environmental Benefits: MaaS can contribute to a reduction in greenhouse gas emissions and air pollution by promoting a shift from private vehicle use to more sustainable modes of transport. By integrating options like electric bikes, scooters, and electric vehicle-sharing services into the MaaS ecosystem, the platform can encourage users to adopt low-emission transport alternatives, reducing the overall environmental impact of urban transport.
Improved Accessibility and Equity: MaaS platforms can improve transport accessibility and equity by offering a wide range of mobility options that cater to diverse user needs. By including services such as wheelchair-accessible vehicles, discounted fares for low-income users, and user-friendly interfaces, MaaS can help ensure that urban transport systems are more inclusive and accessible to all.
Economic Benefits and Job Creation: MaaS can stimulate economic growth and job creation by fostering innovation within the transport sector. The development of new services, technologies, and infrastructure to support MaaS can create employment opportunities in research, engineering, data analytics, and customer service. Additionally, MaaS platforms can help optimize the use of existing transport resources, leading to cost savings for cities and transport providers.
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Antithesis: SaaM: Service-as-a- Mirage - The Inevitable Demise of Mobility as a Service
MaaS has emerged as a potential solution to address the ever-growing transport challenges in urban environments. However, despite its seemingly progressive nature, there are several factors that indicate MaaS may be more of a Service-as-a-Mirage (SaaM) than a sustainable solution.
Inadequate Infrastructure and Integration: A major challenge in implementing MaaS is the lack of adequate infrastructure and integration among transport providers. Many cities are still grappling with outdated infrastructure, which is ill-equipped to support the high-tech requirements of MaaS. Additionally, the need for seamless integration among various transport services is crucial, but is often hindered by competition and lack of standardisation.2
Monopolisation and Lack of Competition: One of the significant risks associated with MaaS is the potential for monopolisation. As larger companies seek to dominate the market, they may buy out or outcompete smaller providers. This lack of competition could lead to higher prices and reduced innovation, ultimately undermining the very principles that MaaS was intended to promote.
Data Privacy and Security Concerns: As MaaS relies heavily on user data, the issue of data privacy and security comes to the forefront. Users need to trust that their personal information, location data, and payment details are secure. However, with high-profile cases of data breaches and misuse of user information, it is increasingly difficult to guarantee that MaaS platforms can maintain privacy and security standards.
Environmental Impact: Although MaaS is often touted as an environmentally friendly solution, its overall impact on the environment is uncertain. The increased use of ride-hailing services, for example, can contribute to greater congestion and emissions. Additionally, the production and disposal of electric scooters and bikes used in shared mobility services can generate significant waste and pollution.
Unsustainable Business Models: Many MaaS providers rely on venture capital funding to stay afloat, as they have yet to establish sustainable revenue streams. As investors eventually seek returns on their investments, these services could become unaffordable for the average user or cease to exist altogether, leaving consumers with fewer transport options. Remember, none of these services were profitable before bundling, why would they be profitable after?
Synthesis: MaaS Hysteria: Navigating the Traffic Between Utopian Dreams and Gridlock Realities
My view is that Visa and Mastercard and their ilk will come to play and put out-of-business all these specialised payment systems that public transport use. That will help. The problem then gets down to the Business Model. As none of the components are profitable now, it will require public subsidy. Will the subsidy be larger for these programs? How are they going to be tailored?
One assumes a monthly subscription program looks like this:
Unlimited Public Transport.
Unlimited Bike Sharing.
X Car shares per month of under W hours.
Y Taxi/Uber riders per month of under Z km.
Will this bundle be better for consumers than the current pay-as-you-go (and in many places there already are Season Tickets for public transport)? Y taxis will cost some amount of money. If I use less than Y per month now, I risk overpaying for the subscription (or will take unnecessary taxi trips (substituting taxi for public transport, walking, or bike sharing to maximise value). If I use more than Y, the subscription might be a bit of a discount, but I will still have to pay for the overages (hopefully no worse than standard fare now — but who knows, look at your Mobile Phone data plans — especially if you live in the United States — to see how tricky this is, and how pissed consumers get).
The idea is to encourage members to forego vehicle ownership, a step function change, that will be better in the long run for society, so some subsidy may be warranted. But I look at the Opal+ plans that my local public transport service provider, TfNSW, offers, and it is extremely unappealing. If you are not very careful, and very certain of your travel plans, you pay more than you would now — the current fares are fairly generous, and if you take more than 8 trips per week, subsequent trips are half fare, and there are off-peak discounts. (I know I would have paid more under this plan, so didn’t sign up). The agency apparently wasn’t willing to give up any revenue to induce more usage.
Shh, don’t mention induced demand
This is the reason it is technically difficult to implement, there is still no standard payment system for public transport. I can’t use a smart card from one city in another. I can often however use a Credit Card (or ApplePay surrogate), but then the locality loses a lot of information. So until Visa and Mastercard seriously play in this space, (they might, it’s not clear, See Visa’s Global Urban Mobility Program and Mastercard’s MaaS Solutions) it isn’t going to get going. Once they do, I think #5 is the main problem.