Why Does Mobility as a Service Matter?

MaaS initiatives are moving fast, and they’re here to stay

Mobility as a service, also known as MaaS, refers to the move away from personally owned modes of transport towards efficient, shared travel options. This important trend is shaping the transportation industry, inspiring a flurry of activity on the part of long established firms and startups. But what does it mean for the industry today, and how can companies build the best MaaS solutions?

The meaning of MaaS

MaaS is the application of the as a service business model to methods of transport, and is geared towards consolidating travel services under a single platform. The most obvious example is Uber, which merges the process of ordering, paying for, and rating a taxi in one app. Another example of MaaS in action is the development of autonomous vehicles, which have been heralded as a replacement for car ownership. Why bother with the hassle of looking after a car when you could call one from a fleet, whenever you liked? Not only would you not have to drive it, but you wouldn’t have to clean it either. Bonus.

From a business perspective, MaaS is about making operations run more effectively, by basing decisions on data. For the customer, this is expected to provide efficient services with fewer friction points, and require less user effort. The concept was first discussed in the 1990s, but has since become the general strategic rule for innovative transportation companies. Incumbents have certainly taken note. In 2012, Ford‘s Executive Chairman Bill Ford gave a presentation called ‘Blueprint for Mobility’. In 2016, General Motors invested $500m in Lyft, and Uber is currently considering the use of self drive technology in Toyota models. These are just a handful of the moves that have been made to navigate the shifting market, and automakers are not the only influential businesses involved. MaaS presents an opportunity for mobile phone companies, public transport providers and tech giants too, especially when it comes to building smart travel infrastructures.

MaaS’s next manoeuver

MaaS is forcing legacy transportation companies to rethink how they offer products and services, and could go so far as to make certain business models obsolete. Innovative travel and transport businesses are meeting customer needs in a new way under unified platforms, which have proven to be more attractive in fast paced, on demand markets. Unsurprisingly, MaaS initiatives represent a wider trend in consumer offerings that reduces user effort to a single click or command. Not only this, but they encourage the growth of data powerhouses. Any MaaS company is also, in essence, a data company. This is partly why technology leaders pose a threat to existing transportation firms, because data is what they do best. Google’s self driving car division, Waymo, is an important player in the expansion of autonomous vehicles, with data from Google Maps to support it.

Competition is healthy, but building collaborative platforms requires cooperation. In 2015, the MaaS Alliance was founded to coordinate MaaS projects across and beyond Europe. Partners include Uber, Siemens, and the cities of Copenhagen, Helsinki, and Vienna. Applying a shared, open approach to worldwide MaaS initiatives is hoped to provide the most convenient, sustainable and cost effective alternatives to private car use. Governments are stepping on board too. The US Department of Transportation, for example, has launched the Smart Cities Challenge to encourage cities to experiment with greener, faster and cheaper travel options.

Mobility as a service is the future of transportation, but it’s a future that in many cases is already here. An industry powered by MaaS solutions will see the widespread adoption of car sharing and autonomous vehicles, but the real change will come when these two aspects combine. Imagine leaving your office, jumping into a driverless electric taxi from an instantly accessible fleet, kicking back and watching your favourite TV show while the car takes you exactly where you need to be without any additional effort on your part. That is the end goal of mobility companies – to provide seamless, sustainable and simple travel options. With the combined expertise of legacy automakers, tech leaders, ambitious startups and governing bodies, the MaaS movement is well underway.

Will all existing transportation companies transition into mobility companies? What crucial developments need to be made before MaaS can disrupt transport infrastructures? How long will it take for MaaS solutions to respond to travel needs in rural areas? Share your thoughts.

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