MaaS is a solution. What’s the problem?

MaaS is a solution. Whats the problem

By Pekka Möttö, Kyyti Group CEO | I was presenting the MaaS concept for a group of city officials in a medium sized European city. It was fair to assume that the audience is well educated about the topic. The first question after the presentation was: What is the problem you are solving? That was a very good question and obviously also well deserved feedback for the speaker. Any startup CEO is always prepared to answer the question of the problem and the solution you are offering. I did have an answer, but I was not left confident that the person who made the question bought my answer. I think it is worthwhile to dig into this question. What is the problem?

To begin with, we need to agree on the definition of MaaS, Mobility-as-a-Service. There are various definitions available, but the basic idea is that MaaS integrates all transportation modes but your own vehicle into one application, making going around without your own car easier. These transportation modes are mobility services. Integration is the key word here. A taxi is a mobility service, like a bus or a train. None of those alone is MaaS. MaaS, by definition, is a service that integrates different mobility services. So at minimum there must be two different services in the solution to call it MaaS. A taxi to the station and a train from there on, offered and paid from one application, would be MaaS. This would also be a travel chain and a multimodal travel chain, multimodality being two different services – taxi and train. Going by taxi and returning by train would also be MaaS, if both were bought from the same application. This would not be a travel chain, but it would be multimodal.

MaaS does not equal travel chain. Multimodal does not equal travel chain either. I am playing with these words because they are often used recklessly and without logic when talking about MaaS. MaaS by definition is multimodal, because MaaS has to include more than one mode of mobility service. A travel chain can be a trip made by changing from train to train or bus to bus. That is changing within the same mode. Changing from train to bus would be multimodal. For those claiming that bus to train is not multimodal because both are public transport, I say that multimodality is independent from business models. A multimodal public transportation system is a business model in which one ticket gives access to several modes of transport services. All this said, I define MaaS as a multimodal mobility solution not including your own vehicle.

What is the problem you are solving? With the above minimum MaaS definition, the question is highly relevant.

To give the answer I need to play with words a bit more. MaaS equals everything else but your own car. That’s easy. Multimodality, on the other hand, is not restricted to MaaS. At the system level, sustainable multimodality is a combination of private car and MaaS. An example of this is driving your own car to the station and continuing with public transport. How many different forms of transport you use to get where you are going is irrelevant. The relevant factor is the private vehicle, which is and will be an essential part of the system. MaaS is not about getting rid of private cars. MaaS is about accelerating the modal shift from private cars to shared resources. Excluding private cars from multimodality would make MaaS a zero-sum game.

Accepting the fact that the private car has an important role in transport leads us in the right direction. What is your problem? That is the question to be asked of the people driving their own cars. Most of us don’t drive for fun and most of us would like to save the money used on our cars. We do have a reason to drive. That reason is the problem. The reason has something to do with flexibility and freedom. If the current public transport system was the solution, the problem would not exist.

In rural areas, the reason for driving – the problem – is obvious: poor or non-existing public transport and no other services beside the taxi, which is not an option for many. Solutions based on modern technology can provide immediate, easily understandable benefits to rural areas. Public transport can be arranged more cost effectively with demand-responsive flexible shared ride technology. Different kinds of shared resource services can be arranged on platforms much more effectively than before. Internal synergies can be utilised by using the existing professional vehicles in the area in a more effective way. An example of this is using the minibuses currently dedicated to one purpose to serve others at the same time by making the empty seat capacity available for other user groups as well. Elderly people, commuters and school children in the same vehicle at the same time is the most obvious example of this. Making more efficient use of the volunteer driver schemes is also one part of the synergy.

The great thing about flexible rural solutions is that the service level can be provided at reasonable cost. Is it realistic to think that MaaS would make people give up their cars in rural areas? At least giving up the second car from the family becomes an option. And yes, what makes the rural solutions MaaS? Integration. All existing services integrated in one easy-to-use application, new demand-responsive services and sharing models created, and all those integrated to public transport at the nearest station.

The rural problem is easy to understand, but why do private cars congest the roads in urban areas with well functioning public transport systems? Every driver has a reason and that reason is the problem. Public transport is typically organised in a system-centric way. This is what is available, learn to use it and if you can not make use of it with reasonable effort, we can not help you. For visitors simple route planners are enough to make public transport usable, but the masses are local commuters and those masses have a problem that needs to be solved. I claim that the vast majority of commuters for whom public transport is currently usable are already using it.

MaaS is customer-centric. MaaS is meant to identify the individual mobility needs and provide a solution for them. The solution is multimodal. Traditional public transport is obviously not enough, even though I have to emphasize that MaaS can not be successful unless public transport is the backbone of the service. Public transport needs to be supplemented with new flexible and demand-responsive services. Citybikes, e-scooters, shared cars, rental cars, shared taxis… the list is long and more are coming.

The need for multimodality means different needs at different times. Multimodal solutions must meet these needs. If you need your car once a week, for example to bring your child to a hobby, you must own a car. Once you own a car, well you know… you are paying for the car anyway, do you want to pay for public transport as well? What if there was a service that would be good enough to go to that hobby once a week? What if there was a service easy and affordable enough to give you access to a car on weekends? Yes, there are car rental companies but why do you own a car that you really need only weekends? What if you would have access to a shared car when you need one close to you at an affordable price? There are a lot of services and new ones are coming. MaaS solutions are meant to make these services easily available and usable, whenever, wherever and however needed.

On top of technology and integration, MaaS has huge potential as a business model. New ways of reselling, packaging, branding and pricing are limitless. Traditional business models in public transport are single tickets, serial tickets and monthly tickets. The modern name for a monthly ticket is a subscription. The subscription is the dominant but not the only model in public transport at the moment, and I see no reason why it would not be such in the future as well. Isn’t it fascinating idea to think of all your mobility needs met with a good service level at a fixed and affordable price? It will take time to get there, because first the operators need to have enough information to be able to build the products and pricing models. What will happen first is that transport sector adapts to the normal business practises where customer-centric marketing and productisation routines become the new normal. Regardless of the business model, MaaS will provide more options from one place compared to current mobility service offerings.

Summarising the above, MaaS is digital technology enabled mobility service offering, which is more flexible and individual than traditional public transport. Who will be the one offering MaaS for the customer? I really don’t care and it does not matter as long as the system performance data is available for regulators and transport authorities. A MaaS operator can be a transport authority, a transport operator, an existing commercial brand, or a new MaaS operator. What matters is the outcome.

What did I answer to this person asking about the problem we are solving?

Usability of public transport in the city and mobility service level at rural areas.

The questioner was seemingly sceptical. They did have a multimodal modern public transportation system in place. Not enough people were using it, but that was a feature, not a fault. The usability was good for those currently using the service. Users are not the problem, those who are not using have a problem.

Having given this some thought, I think I was right. In my opinion MaaS is centrally about better usability of public transport. If it wasn’t, this would make no sense. The main issue of the usability at the moment is the lack of flexibility, which we are solving. The real imperative problem behind all this is sustainability, which can not be reached without improving the usability of public transport. I have no better solution than MaaS.

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