Innovation

Les Echos” Societies on May 29, 2018.

The startups growth model often consists of proving its viability in a large metropolis and then exporting from one capital to another in order to capture the biggest markets in priority. The global race between startups sometimes leaves out a large part of the population, who do not live in hyper centers.

Are there any “business models” to make technology more accessible?

The chauffeur driven car platforms, based on connecting customers with a community of independent drivers, have conquered all the major cities in just a few years. But this business model restricts them to expand in other territories, where such communities cannot subsist. The underlying technology and customer experience are great inventions that should benefit everyone.

By finding the right business models, such as Software As A Service – or even working with public actors! – these technologies can be spreaded in all territories (rural, semi-urban) and still experience hyper-growth.

Are the big metropolises always the most important markets?

Concerning the mobility, it is mainly in medium dense areas where the need is the greatest: public transport is harder to optimize and expensive, where heavy infrastructure is not viable.

Many innovations find their market first in remote territories or with less infrastructure. This is the case for mobile payment in Africa, delivery by drone or telemedicine. Let’s also bet that autonomous vehicles will primarily benefit semi-urban areas, where roads are less complex and the cost of mobility is higher!

Original article published on the front page of Les Echos Societies

Grégoire Bonnat, President of Padam

A unique app and a single pricing granting access to all transport modes available in the city: this is how Helsinki, pioneer of Mobility as a Service (MaaS), intends to revolutionize urban transport.

For the past two years, getting around the City of Helsinki has been as simple as a click. By connecting to “Whim”, locals and visitors enter their route and are offered the combination of transport most suited to their needs and preferences. The same app also allows them to pay for their journey either individually or through various subscription packages.

This is the principle of MaaS, Mobility as Service, which helps users seeking above all for the most effective way to move, regardless of the transport modes employed. Users thus choose one of the routes proposed by the app, and pay the price including the use of all the necessary modes (the various public transport, of course, but also taxis, car rental or even self-service bikes). It is no longer a question of choosing between individual transport, public transport, on-demand transport, soft mode or shared mobility: the app offers everything, instantly.

One goal: abandon the individual car

“While the user had to adapt to the constraints of the different transport operators, it is now transport that is at the service of the user”.
A single operator, a single ticket, a route booked and paid via smartphone: we measure the extent of progress for the user, in terms of saving time, flexibility and comfort. For public authorities too, this new way of thinking about mobility is revolutionizing transport policy. With its 1.5 million inhabitants, the City of Helsinki faced the same problem as most European capitals: a continuous population growth and a too high proportion on people using their car. There was an urgent need to curb traffic congestion and the resulting health consequences in terms of pollution. In light of this, the Finnish metropolis has embarked on an ambitious plan for 2025, taking advantage of an innovative ecosystem. MaaS Global, the start-up that creates the Whim app, is itself from Helsinki, displaying its solution in the Finnish capital, before successfully spreading it elsewhere in Europe, notably in Antwerp and Birmingham.

MaaS in Helsinki: the conditions for the emergence of these new services

The goal of the City of Helsinki is to see its inhabitants abandon their individual cars altogether. In a society structured by the use (and ownership) of the car, the change promises to be radical. In Helsinki, the world of urban transport itself has been forced to rethink its practices. For a single platform to integrate all the timetables and journeys of the multiple transport operators, their collaboration must be total. This includes opening up their datas. This transition of carriers to open data constitutes a requirement imposed by Finnish law, which has allowed the emergence of private players such as MaaS Global.

The MaaS, a fundamental element of the Smart City

“While Helsinki is a pioneer in this field, markets for this new form of mobility are emerging, and are coveted”

The abolition, or at least reduction, of the boundaries between public and private transport operators is indeed a feature of the Mobility as a Service. Platforms such as Whim act as intermediaries, purchasing transport services from multiple operators and reselling them to their customers, taking a commission on the way.
The formulas offered are varied: single rates, weekend, weekly or monthly subscriptions… and, the most comprehensive service, the monthly subscription giving unlimited access to all transport, including taxi or car hire.

In Helsinki, this unlimited subscription is available for 499 euros. Behind this seemingly high price, the start-up hammers home its flagship argument: “The app gives you all the advantages of the car but without the disadvantages of ownership, and at a cheapest cost than the monthly cost of an automobile.”

Conquering and retaining a large audience among the people of Helsinki is a challenge for MaaS Global, which aims to achieve financial balance in a few years. In a largely deregulated sector, competitors have emerged, offering their own Mobility as a Service app.

Like the mobile phone market, we can expect a diversity of operators, competing for services and prices to involve Helsinkiers. Elsewhere, such as France with SNCF, “historic” operators are also interested in this emerging market.

But in the immediate future, Helsinki is where the mobility of the future is emerging: flexible and instantaneous, based on artificial intelligence and open data, the Mobility as a Service is now an entire part of the smart city.

Smart mobility could shape the future of our territories using technology such as dynamic Demand-Responsive Transport, which is a public transport service.

Flow and mobility management is a highly strategic matter for which there are no miracle solutions

On one hand, urban spreading speeds up (the UN estimates that 2.5 billion more people will live in cities by 2050). Car congestion is more and more expensive (17 billion euros per year in France, the equivalent of 1,943 euros for each motorised home) and as a matter of fact increases the investment costs on transport infrastructure. On the other hand, peri-urban and rural areas are neglected. Car are the most used mode of transport (and sometimes the only one available). If smart mobility does not solve all problems, it could, however, change existing paradigms to shape the future of our territories.

Smart Mobility: a technological and societal issue

Smart mobility is defined by the use of technology to serve the users’ mobility needs. To run, this technology needs data that is then collected, aggregated and processed.

In most cases, private companies handle this work, especially American giant firms like Google, Tesla or Apple. The best example is the Waze app (owned by Google), where individual user data is shared to serve everyone (and especially advertisers who can offer geo-located and contextualized advertising).

In some cases, Public Authorities collect the data themselves. This is the case with the city of Lorient (France), which has 200 sensors to track acoustic pollution in real time. The city of Rennes (France) calls on 35 volunteer residents to carry out air quality surveys.

Finally, the last option is the public-private partnership. For example, the city of Nice (France) and Uber have partnered on a pilot project for bus journeys in underserved areas at night. The city has access to anonymized user trips data. They are used to analyze the distribution of transport demand to better adapt the offer.

Smart mobility therefore is tied to a very large number of subjects. These include:

• The problems of carpooling and chauffeur-driven cars: to connect drivers and passengers.
• Bus geolocation: to anticipate waiting times and better manage routes.
• Real-time traffic: to smooth traffic flow.
• Managing available parking spaces: to save time, limit congestion and pollution.

The 7 characteristics of smart mobility

Smart mobility is a holistic approach that is not just technological. It also incorporates human, societal and environmental parameters:

• Flexibility: to allow users to choose the modes of transport that best suit their needs.
• Efficiency: to get users to their destination quickly and without disruption.
• Integration: to plan and display a complete route, door to door, regardless of the mode of transport used.
• Clean technologies: to move away from polluting vehicles in favor of zero-emission vehicles.
• Safety: to reduce the number of accidents and prevent them.
• Inclusiveness: to include people far from urban centers and conventional public transport.
• Accessibility: to offer access to a mobility solution to everyone, regardless of physical condition.

To work, smart mobility relies on intelligent data processing. Artificial intelligence, however, is not an end itself, but a tool to make mobility fairer and more inclusive. That’s why fair mobility is complementing smart mobility.

Dynamic Demand-Responsive Transport: an ideal solution to answer the Smart Mobility’s challenges

As its name suggests, Demand-Responsive Transport is a service that works only under reservation. Users can book their trip via their smartphone and track the progress of their vehicle in real time. It’s a relevant solution for peri-urban and rural areas, where demand for transport is too scattered and conventional lines are inefficient. It’s an ideal solution for today’s and tomorrow’s smart transportation.

Demand-Responsive transport is a public transport service that is a part of the smart mobility approach for various reasons:

• Flexibility: it adapts to schedules and mobility needs.
• Efficiency: its itinerary is automatically calculated and optimized according to user reservations. It’s less time on the road, less congestion and time savings for users and drivers.
• Multimodal integration: its itinerary is planned from the departure to the arrival. In addition, it can interface with other modes of transport if needed (bus, metro, tram, etc.).
• Clean technologies: it promotes clean vehicles.
• Safety: its drivers are professionals whose job is to drive users in the best conditions.
• Inclusiveness: it covers all geographic areas, from villages to large urban centers where the transport offer is generally very limited (even non-existent), especially at night.
• Accessibility: it makes travel easier for people with reduced mobility, the elderly, young people and users who do not have driving license.

Demand-Responsive transport is open to all territories and adapts to all scales. It offers new perspectives for public authorities. It is good citizen, human and environmental practice that transforms technology into a lever for cohesion and development. All for a controlled cost.

Read more about the other advantages of the Demand-Responsive Transport

After three years of experimentation, research and development, the startup Padam Mobility offers transport operators its solutions to transform bus services. Thanks to artificial intelligence, the lines, schedules and routes are now created and optimized in real time while user experience is completely renewed.

Mobility and the difficult equation in low- and moderately dense areas

Padam Mobility’s project was born from simple observations: on one hand, a rigid, not reliable and unsuitable to the people’s needs create a strong frustration of users; on the other hand, a way of bus operating that has not evolved for decades despite new digital tools available (smartphone, cloud, real-time optimization). In all circumstances, once fixed lines are drawn with fixed schedules, supply is no longer adapted to demand, which leads to many under-optimizations.

The territories must solve an extremely difficult economic and environmental equation for mobility. Except in a few major metropolises, the modal share of the car does not decrease despite a widespread political will. A significant effort is also still to be made for inclusive mobility to ensure the basic mobility needs of those who do not own a car. But to tackle these environmental and social imperatives, local authorities must contend with constant or decreasing budgets.

This tends to cast a harsh light on the under-optimization of public transport services. It is no longer possible to see, day after day, vehicles with fifty seats driving almost empty, while a demand for mobility remains unserved. This explains in particular the craze in recent years for carpooling, bicycles – electric or not – and other micro-mobility solutions. Despite these new offers, the main challenge is to improve public transport, especially buses, which are the bedrock of mobility in all territories. This is where we will find a performance optimization improving access to mobility and reduce the cost per trip.

That’s why we created Padam Mobility with the ambition of transforming the business of bus operator through artificial intelligence. On the principle of DRT, we first experimented shared shuttles in Paris region, by night, and then on daily mobility from home to work. In 2017, we transformed this Software As A Service products for transport operators.

Transforming the trade of transport operator with artificial intelligence

A first wave of on-demand transportation services was introduced in the 1990s. These reservation services (by telephone) have made it possible to serve some territories in a very light way, but the ambition of these services has so far been limited and the tools to operate them insufficient to be transposed to transport Mass.

We have entered a whole new era since we have the ability to know and manage services entirely in real time. The Padam Live operating platform© is the embodiment of this idea: customers book and follow their journey on their mobile application, drivers follow a roadmap constantly updated on their tablet, operators know to at any time what is the state of the fleet and the system as a whole. For truly real-time management, the challenge is of course to make decisions in a fully automated way on the allocation of vehicles, the calculation of their route and the information traveler, which is unique to intelligence Artificial!

Technically, this level of automation presents several challenges.

From a scientific point of view first: when we started the project, we realized that very little work in the literature concerned the optimization under constraints and real time of a fleet of vehicles, the “online” methods. Until now, so-called VRP (Vehicle Routing Problems) problems were always handled by “offline” methods, before the smartphone and cloud gave relevance to a new generation of systems optimization. So we took these problems at the base with experts in Operational Research and Optimization under Constraints, without recovering any existing bricks.

Second, automation requires a strong operational experience. By nature, transport faces many external constraints. To name but two: user behaviour (customers or drivers) can cause disruption at any time (delays, errors, change of mind, etc.) and congestion adds a strong random component. Only a good operational experience can lead to a high level of automation and reliability, which justifies the experiments that Padam conducted in its early days, as other market players have done.

Mobility and artificial intelligence: what are the prospects?

The stakes are up to the operational technical difficulties. As these begin to be overcome, we see radical performance gains on the projects we are working on. To serve a fixed mobility demand, on-demand transport can reduce costs by an average of 30 per cent compared to conventional fixed-line bus services.

Excluding highly charged and therefore efficient fixed bus routes, we estimate that in the long run forty per cent of bus journeys will be made on an “on-demand” mode. All public transport networks are affected by this transformation, from rural areas to the outskirts of major metropolises. Beyond the pure performance gains, the real-time management of the services allows a better response to hazards (failures, road problems) and therefore a much better reliability. The customer experience is transformed, it is accompanied from the search of the route, until its arrival at its destination with a quality of information-traveller unprecedented.

Finally, it is difficult not to put the development of on-demand transport in perspective of that of autonomous vehicles. These will be expensive to purchase but with a lower cost per kilometre than a driver-driving vehicle, which means that transportation services will make the most of it. The interface with on-demand transportation services will be natural. We can even risk a prognosis: just like on-demand transportation, it is first in medium-sized cities that autonomous vehicles will be truly adopted. The constraints , especially roads, are less complex and the economic stakes of mobility are the strongest.

Article originally published on Telecom ParisTech