Month: August 2020

A new study from Juniper Research has found that the number of vehicles with embedded connectivity will reach 200 million globally by 2025; rising from 110 million in 2020. One of the main beneficiaries of this growth will be mobile operators.

The incorporation of eSIMs (embedded SIM) into the vehicle will enable operators to leverage their existing network infrastructure to claim $3 billion (€3 billion) of additional service revenue by 2025, by acting as an M2M (Machine-to-Machine) connectivity provider.

eSIMs to benefit operators and automotive OEMs

The new Juniper Research study, Operator Connected Car Strategies: Future Opportunities & Market Forecasts 2020-2025, predicts that eSIMs will act as the catalyst for future operator service deployments in the connected car space. Smaller form factors and higher physical durability of eSIM modules will attract automotive OEMs to the new standard over existing traditional SIMs.

The research urges operators to leverage wholesale agreements with automotive OEMs to create steady revenue streams from the connected car market. However, operators must ensure the provision of management services, either directly, or via partnerships with established IoT platforms, to attract high spending automotive OEMs to their networks.

Research co-author Sam Barker remarked: ‘As the adoption of embedded SIMs increases, operators’ success in the market will be determined by which platforms can offer the most comprehensive value-added services to automotive OEMs.’

5G networks to provide monetisation challenges for operators

The research predicts that there will be 30 million vehicles globally with embedded 5G connectivity by 2025. As embedded 5G connectivity becomes more prevalent in vehicles, it anticipates that 25% of cellular data generated by vehicles will be attributable to 5G-capable vehicles by the same year, despite representing only 14% of the installed base of vehicles with embedded connectivity. As a result, operators will need to charge a premium for 5G automotive connections, in order to account for the additional network traffic generated by 5G-based automotive traffic.

For more insights, download our free whitepaper: Connected Cars: Fuelling Operator Revenue.

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An audit into the mapping of potholes in England, said to be the first-of-its-kind, has been launched today by Transport Secretary Grant Shapps, aided by data from on-road businesses such as Uber and Deliveroo. The goal is to better target improvements so that the UK’s notoriously poor-quality roads are in an improved condition as people return to work and school.

The Department for Transport will work with Gaist, a highway data and mapping company, businesses such as Deliveroo, Uber, Tesco and Ocado, alongside local highway authorities to identify ‘pothole hot-spots’.

Combining collated data on current potholes held by nation-wide businesses, and the most up-to-date bank of roads imagery in the country from Gaist, the Department will be able to paint the most comprehensive picture ever of where funding is most needed to make sure roads are not plagued by potholes – making them as safe as possible as more commuters and students undertake journeys in the coming months. The plan will help cyclists and motorist get back to school and work.

The Government has already committed £2.5bn in funding for pothole repairs in the big nationwide programme ever announced. The launch of the review comes as new data reveals that highway maintenance works undertaken in the past months when roads were quieter during lockdown has led to 319 miles of resurfacing, making sure that roads are in better condition so that people can get back to work and school safely.

Since 2010 the Government has provided over £1.2 billion (€1.34 billion) solely to help repair potholes on the local highway network – including £500 million from the £2.5 billion announced in the Budget earlier this year. Safe roads have never been more important, with the Government urging commuters, parents and school children to choose to cycle or walk for part or all of their commutes to help ease demand on public transport and travel safely as the country recovers from the pandemic.

Better quality roads will also make it easier, safer and more convenient than ever for people to cycle. The Government has previously announced plans to deliver a cycling and walking revolution by investing £2 billion over the next five years to support more people to choose active travel, and through the launch of our most ambition Cycling and Walking plan ever.

With potholes posing a problem to all road users’ safety, the pothole mapping review will allow for the Government to ably target the worst-affected areas, levelling up road quality across the country.

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One of the first industries to be hit hard by the global pandemic and subsequent lockdown was mobility, says Mark Thomas, VP of marketing at Ridecell. Public transportation traffic plummeted 70-90% according to analysts McKinsey, airlines lost billions, ride-hailing services lost up to 70% of their business, and many micro-mobility and carpooling services suspended operations.

With lockdowns extending, many have speculated about how and when mobility, and in particular shared mobility, might recover.

Shared mobility can be divided into two subsets. Ridesharing, or sharing a vehicle at the same time as another person; and carsharing, where the vehicle itself is shared between people, but not at the same time. It’s clear that ridesharing has taken a dramatic downturn during COVID, but we’re seeing something much more interesting when it comes to carsharing. While initially, carsharing experienced a similar dip, it has now surpassed pre-pandemic volumes.

This is true in Europe and North America alike. Companies like GIG in the US expanded to Seattle during the height of COVID, as part of broader growth and expansion. Toyota has been steadily growing its Kinto Share programme, launching a new service in Sweden during the pandemic. Renault, known for its ZITY carshare service, also experienced growth mid-pandemic, expanding operations in Madrid and launching a new service in Paris.

Carsharing is clearly on the rise, but it’s how it’s being used that has changed. Across fleets, vehicles are being driven more and customers are keeping their cars for longer. Customers are increasingly wanting access to shared vehicles as a means for avoiding public transport.

An IBM study showed 20% of public transit users won’t use transit again until after the pandemic is over, and another 20% will use it significantly less. Some of these people will opt to use their own cars more, but others without cars will need short term access to a vehicle.

A new kind of demand

If COVID has taught us anything, it is how quickly demand and use cases can change. Before the pandemic, ridesharing growth was limited by the number of drivers with vehicles, so the hot market for OEMs and dealers was in providing vehicle rentals to Uber and Lyft drivers.

Today, the focus has shifted to moving goods and groceries rather than people. Meeting the needs of Instacart or providing vehicles to Amazon Flex drivers has become the hot new trends driving the market. These shifts have required technology with the flexibility to meet rapidly changing use cases and the ability to reach new customer segments.

The good news is that for original equipment manufacturers (OEMs) and dealers alike, the same technology used for carsharing fleets can be used to solve problems they are facing today with selling and servicing cars. In the age of the pandemic, no-touch services are now expected, but the old test drive processes don’t work like that.

With modern sharing technology, however, customers who want a test drive can download the dealer app, validate their driver’s licence and credit card, and then schedule the test drive. When they get to the car, they unlock it using the app on their phone and take it for a drive, without needing to talk to a salesperson or share the vehicle with someone. Dealers can offer creative solutions, such as configuring the service for 20 minute free rides or for paid longer test drives and apply the cost of the trip to the purchase price should the customer decide to buy the vehicle.

OEMs are also seeing more demand from a new customer category the short-term vehicle customer. New use cases have OEMs considering how they simplify the process to get customers into vehicles on a subscription basis or in month-to-month, all-inclusive lease plans.

There is an increasing number of people who want dedicated access to a vehicle right now but aren’t sure how that might change when things return to a more normal state. Buying a vehicle or even a lease implies a commitment for years. This new class of prospective customers want a vehicle for months and is intrigued by the simplicity of not needing to acquire insurance, manage maintenance, or subscribe to an emergency services club separately.

Challenges to overcome

While technology exists to support this new focus on shared mobility, some obstacles remain. Regulation is the biggest hurdle. Cities, especially in the US, have been reluctant to advance shared mobility by being slow to make changes everything from providing more parking for shared vehicles, to removing street parking for more loading and unloading zones for ridesharing or making permits available for bike and scooter docks.

Consumer preference can sometimes prove to be an obstacle as well. Interestingly, car owners have traditionally been the most vocal opponents to anything that would cause them inconvenience, especially anything that would prevent them from having easy access to parking.

COVID has opened up new ways of thinking as cities have been forced to make transportation changes. Streets have been closed to make way for more pedestrian and non-vehicle traffic. Street parking has been removed for restaurants to open outdoors.

These shifts have been well received, and the tide may just be turning away from holding private driving and parking as the birthright of all citizens. As new behaviours become acceptable and transportation changes become the status quo, we’ll start to see cities increasingly embrace the proliferation of shared mobility services as safe and clean alternatives to driving.

The path to profitability

The early days of shared mobility, where it was enough to just get a fleet of vehicles, bikes, scooters and show service usage, have long past. Now it’s about establishing a shared mobility service that has profitability baked in. We call this high yield mobility. The hallmark of high yield mobility is not just about creating a compelling service but also building operational efficiency and multiple uses for the fleet from the beginning. 

To keep operational costs down, companies need a platform to manage when and how the vehicles are moved, where they are parked, and how efficiently they are cleaned. For example, rather than spend $20 (€16) to have the vehicle moved to avoid a street cleaning fee, a company can use dynamic pricing to offer that vehicle on sale and encourage customers to choose that particular vehicle for their next ride.

Fleets today need to have the flexibility to power multiple different kinds of businesses. Each business has a peak demand curve. If you can stack the demand curves, you get a business that has far more usage, revenue, and, eventually, profit.

Electric fleets are a long-term option to driving costs down in mobility services. ZITY, for example, is an all-electric fleet in Europe. Fleet owners have reported the cost of operating an electric vehicle to be half or even more of the cost of an internal combustion engine (ICE) vehicle. Fleet providers can take responsibility to charge vehicles in centralised charging depots, and also clean and inspect the vehicles while they are there.

For shared mobility, the path to profitability, sustainability, and long-term growth may feel a bit winding. If the pandemic has taught us anything, it is that alternatives to transportation are in high demand and customers still want but are dictating a new kind of shared experience. Companies who work now to address these shifting trends will find they are primed to lead a new era for mobility.

The author is Mark Thomas, VP of marketing at Ridecell.

About the author

The author, Mark Thomas is the VP of Marketing at Ridecell, a platform for launching, operating and scaling new car and ride-sharing mobility services. Prior to joining Ridecell, Mark headed the connected car marketing team at Cisco Jasper, where he developed the product and go-to-market strategies for automotive OEMs. Prior to Cisco, Mark led product marketing at HERE, an automotive maps company. In addition, Mark has served in marketing, strategy, and business development roles at Apple and Nokia.

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Congestion on core road networks is a major problem for many countries around the world. Indeed, according to the largest ever study of global traffic, conducted by INRIX in 2017, congestion in the US alone costs $305 billion (€257 billion). In the UK, Highways England estimates the cost of congestion on the motorway and major road network to be in the region of £2 billion (€2 billion) every year.

As Chris Shannon, CEO of Fotech Solutions says, the economic burden of congestion means that many countries are now trialling the concept of ‘smart motorways’. The first test of a smart motorway project took place in 2006 in the UK, and since then the concept has attracted a lot of interest with schemes becoming common in several countries, including Australia, New Zealand and Switzerland.

‘Smart motorways’ actually comprise several different variants. Regardless of these nuances though, the most common and visible features of a smart motorway include some use of the hard shoulder as a traffic lane and variable speed limits. These measures are intended to increase road capacity and to keep traffic flowing as smoothly as possible.

‘Improvements to be made’

Evidence from the UK, which currently has the most deployments, suggests that there are still improvements in the technologies that underpin smart motorways to be made.

While data shows that smart motorways have increased capacity by up to a third, a recent report published by the UK’s Department for Transport (DfT) highlights that although smart motorways carried 10.7% of motorway traffic in the period 2015-18 (inclusive) they accounted for, on average, 11.4% of the serious casualties.

As such, smart motorways are a potentially powerful solution to the issue of congestion, but if their use is to be expanded we have to ensure that the risk to drivers is minimised. If anything, smart motorways should be safer than the normal road network.

If this is to be achieved, then we need to take a look at the fundamental technology that underpins smart motorway initiatives.

The limitations of smart motorways

The key technical issue for smart motorways is the reliance on cameras and induction loops. Typically loops or cameras are installed every 400 metres along a smart motorway. Clearly, these ‘point’ sensors cannot deliver full continuous monitoring of the entire motorway.

There are inherently gaps in the coverage and these gaps are where delays and errors creep in, which in turn increase the risks for drivers. For example, the DfT report highlighted that the camera-based system used to identify broken down vehicles or drivers experiencing issues still takes an average of 17 minutes to spot a vehicle in trouble.

It then takes a further 17 minutes for a rescue team to arrive on the scene. If a driver is in trouble on a fast-moving motorway, a half hour response time is very obviously a significant risk.

Unfortunately, installing sensors at more regular intervals is very costly and so there will always be compromises in the coverage point sensors can provide. But how can we use technology to improve performance and in particular speed up incident detection times?

Using fibre networks as additional sensors

There is potentially a solution already in the ground. The sensor networks for smart motorways are already connected via fibre cables and this fibre could be put to use as a sensor in its own right. For fibre owners and installers there is a significant opportunity to offer more value to smart motorway schemes.

Wherever fibre is installed alongside a motorway, the addition of Distributed Acoustic Sensor (DAS) technology can effectively convert the cable into thousands of vibration sensors as if you are deploying an army of microphones along the roadway.

These vibration sensors can detect the unique ‘acoustic signature’ of a range of disturbances in the road disruptions in the flow of traffic or changing behaviour in the vehicles (i.e. slowing down/speeding up/changing lanes) and inform operators on what incidents have taken place, exactly where it happened and when it happened.

By virtue of being fibre-based, this system inherently provides full coverage of the entire length of the motorway ‘filling in’ the gaps between cameras and loops to increase the efficacy and accuracy of identifying incidents.

Fibre sensors also provide automated alerts in real-time boosting response times. This is crucial to minimising the potential disruption to keep traffic flowing even more smoothly and minimising risks to drivers.

While smart motorways remain in their infancy, it is clear that they are an appealing solution to the challenge of congestion. However, safety of the road users must be paramount. While existing sensors provide a certain level of performance, we must explore every possible technology that can make systems more effective and minimise risk. Fibre infrastructure has a massive role to play in delivering on this challenge.

The author is Chris Shannon, CEO, Fotech Solutions.

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