1 THE ROAD TO OPPORTUNITIES IN RURAL INDIA: THE ECONOMIC AND SOCIAL IMPACTS OF PMGSY MOBILITY AND TRANSPORT CONNECTIVITY SERIES ADAPTING MOBILITY-AS-A- SERVICE FOR DEVELOPING CITIES A Context-Sensitive Approach 2 MOBILITY AND TRANSPORT CONNECTIVITY SERIES © 2021 The World Bank 1818 H Street NW, Washington DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org Some rights reserved This work is a product of the staff of The World Bank. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. 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Examples of components can include, but are not limited to, tables, figures, or images. All queries on rights and licenses should be addressed to World Bank Publications, The World Bank Group, 1818 H Street NW, Washington, DC 20433, USA; e-mail: pubrights@worldbank.org. Cover design: Kilka Diseño Grafico Contents Acknowledgments...............................................................................................................................................................................................................7 Executive Summary.............................................................................................................................................................................................................8 1. Introduction...............................................................................................................................................................................................................17 1.1 The context and vision for MaaS in developing cities..................................................................................................... 19 1.2 The tenets of MaaS.............................................................................................................................................................. 21 1.3 Types of integration and other basic concepts................................................................................................................ 22 1.4 The big picture..................................................................................................................................................................... 24 1.5 Our report............................................................................................................................................................................. 27 References...................................................................................................................................................................................... 28 2. Supply......................................................................................................................................................................................................................... 29 2.1 Early MaaS schemes in Europe and super apps in Asia.................................................................................................. 31 2.2 The MaaS provider . ............................................................................................................................................................ 35 2.3 Mobility service providers................................................................................................................................................... 37 2.3.1 ICT-enabled mobility services................................................................................................................................... 37 2.3.2 Traditional mobility modes....................................................................................................................................... 47 .................................................................................................... 52 2.3.3 The role of each transportation option in MaaS. References...................................................................................................................................................................................... 53 3. Demand....................................................................................................................................................................................................................... 57 3.1 Potential users of MaaS in developing cities.................................................................................................................... 61 .......................................................................................................................................................... 62 3.2 Mechanisms of MaaS. ........................................................................................................................ 67 3.3 Impacts of MaaS in developing countries. 3.4 Travel demand and MaaS in the wake of Covid-19......................................................................................................... 69 References...................................................................................................................................................................................... 73 4. Technology.................................................................................................................................................................................................................77 4.1 Digital services integration................................................................................................................................................. 81 ......................................................................................................................................................... 83 4.1.1 Data integration. 4.1.2 Ticketing and payment integration.......................................................................................................................... 85 4.2 The digital, technological, and financial divide and sector informality......................................................................... 87 References...................................................................................................................................................................................... 90 4 MOBILITY AND TRANSPORT CONNECTIVITY SERIES 5. Business..................................................................................................................................................................................................................... 92 5.1 A complex balance............................................................................................................................................................... 94 5.2 The MaaS value proposition............................................................................................................................................... 95 5.3 Costs and revenues............................................................................................................................................................. 97 5.3.1 Fare-based pricing and revenues............................................................................................................................. 98 Ancillary revenues...................................................................................................................................................... 99 5.3.2 ................................................................................................................................................................. 100 5.4 Implementation. 5.5 MaaS implementation in emerging economies............................................................................................................. 103 References.................................................................................................................................................................................... 105 6. Governance..............................................................................................................................................................................................................106 6.1 The role of government....................................................................................................................................................... 109 Proactive government leadership in MaaS implementation.............................................................................. 110 6.1.1 ............................................ 110 6.1.2 Levels of public sector involvement in ICT-enabled mobility services and MaaS. 6.2 Governance and regulatory challenges.......................................................................................................................... 113 6.3 Equity challenges............................................................................................................................................................... 114 6.4 Climate change mitigation challenges............................................................................................................................ 116 6.5 Overcoming barriers: Governance and regulatory framework for the MaaS city..................................................... 117 6.5.1 Strengthening or creating a Mobility-as-a-Service agency................................................................................. 117 6.5.2 Building a MaaS regulatory framework that encompasses all modes.............................................................. 120 6.5.3 Financing and pricing an equitable MaaS scheme through incentives............................................................. 121 6.5.4 Managing curbs, roads, and sidewalks................................................................................................................. 124 ................................................................................................................. 125 6.5.5 Establishing data-sharing agreements. 6.5.6 Establishing interoperable payments systems..................................................................................................... 128 6.5.7 Supporting accessibility of MaaS for disadvantaged populations..................................................................... 128 References.................................................................................................................................................................................... 129 THE ROAD TO OPPORTUNITIES IN RURAL INDIA: THE ECONOMIC AND SOCIAL IMPACTS OF PMGSY Figures Figure 1. Types of integration involved in MaaS schemes.............................................................................................................. 23 Figure 2. Illustrative example of direct links between mobility system stakeholders: With and without MaaS....................... 36 Figure 3. Categorization of ICT-enabled mobility services as ‘to rent’ or ‘to ride’ services.......................................................... 37 Figure 4. MaaS functional structure................................................................................................................................................... 81 Figure 5. High-level conceptualization of a MaaS data ecosystem. .............................................................................................. 84 Tables Table 1. Characteristics of four European MaaS schemes. .............................................................................................................. 33 Table 2. Overall and by-criteria social utility ratings of different modes and services................................................................ 52 Table 3. Advantages and disadvantages of the different MaaS implementation strategies.................................................... 112 6 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Case Study Boxes Box 1. Mobility-on-demand: The MaaS-like concept trending in the USA..................................................................................... 32 Box 2. Addressing supply-side challenges to MaaS implementation in emerging economies: Kochi One in India. ................ 34 Box 3. Peer-to-peer ‘to rent’ mobility services................................................................................................................................... 38 Box 4. Conflicts between motorcycle ridesourcing services and traditional motorcycle taxis in Bangkok, Thailand.............. 41 Box 5. Bus-sharing services: The example of Jatri in Bangladesh. .................................................................................................. 42 Box 6. How fair is the allocation of ’to rent’ infrastructure? Example of a bike-sharing system................................................. 45 Box 7. Rwanda as a leader in electric and shared ‘to rent’ mobility services in Africa................................................................. 46 Box 8. Challenges in the “formalization” of informal transit operators and opportunities for MaaS: The case of Mexico City............................................................................................................................................................ 49 Box 9. Pecuniary incentives to influence behavior: The case of Rio de Janeiro’s women-only car............................................. 64 Box 10. Randomized transportation discount coupons: The case of 99/DiDi ridesourcing........................................................ 65 Box 11. Travel behavior changes in the Covid-19 crisis: Are they permanent?. ............................................................................ 71 Box 12. Integrating transport data: The Digital Matatus Project in Nairobi.................................................................................. 84 Box 13. Innovations in fare collection systems in Africa: Maputo, Mozambique.......................................................................... 89 Box 14. Ridesourcing still on the path to profitability...................................................................................................................... 97 Box 15. Tailoring mobility services and payment options for different customers: The example of Whim Helsinki............... 99 Box 16. MaaS for sustainable policy goals: The case of UbiGo, Gothenburg.............................................................................. 102 Box 17. Building capacity and laying the foundation for MaaS governance: The case of Sierra Leone’s Directorate of Science, Technology, and Innovation.......................................................... 118 Box 18. Smart regulation through pricing use: The example of São Paulo. ................................................................................ 122 Box 19. Data sharing and data governance arrangements: ............................................................ 126 The World Development Report and the example of Estonia’s X-Road system. 7 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Acknowledgments This report was prepared by a team of World Bank staff and consultants led by Bianca Bianchi Alves and Winnie Wang, which includes Joanna Moody, Ana Waksberg Guerrini, Tatiana Peralta Quiros, Jean-Paul Velez, Maria Catalina Ochoa Sepulveda, and Maria Jesus Alonso Gonzalez. The authors are grateful to Georges Bianco Darido, Arturo Ardila Gomez, Binyam Reja, Vivien Foster, Cecilia M. Briceno-Garmendia, and Shomik Mehndiratta for their support and guidance. They also thank World Bank col- leagues who served as internal peer reviewers, including Fatima Arroyo-Arroyo, Wenxin Qiao, Leonardo Canon Rubiano, and Carlos Bellas Lamas for their comments and contributions. Special thanks to external peer reviewers Claudia Adriazola-Steil (World Resources Institute) and Susan Shaheen and Adam Cohen (University of California Berkeley) for their astute and detailed input that helped refine the messaging of the report. The authors gratefully acknowledge the funding support provided by the Transport Window of the Mobility and Logistics (MOLO) Multi-Donor Trust Fund. The MOLO is managed by the World Bank’s Urban Mobility Global Solutions Group (UMGSG) with financial support from the Swiss Ministry of Economic Affairs (SECO) and German Ministry for Development Cooperation (BMZ). 8 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Executive Summary Now is a time of great dynamism in urban mobility to people’s unmet mobility needs. They are often systems. Advances in information and communica- unplanned and undercapitalized, negatively affecting tion technology (ICT) and developments in private safety, comfort, and environmental and operational sector-led and technology-enabled service models efficiency; and, in the context of rapidly growing and are fundamentally changing the interplay of mobility sprawling cities, they are often inadequate to fully supply and demand. serve mobility needs. In cities in middle-income coun- tries, these informal transit services mix with formal Urban mobility systems in developing cities could public transit services, such as metros, bus rapid significantly benefit from these changes. In most transit (BRT), and formalized bus services, as well as cities in low-income countries, a complex system of exponentially growing fleets of cars and motorcycles. transport modes coexists with minimal infrastructure For these cities, a lack of integration among these and enabling technology. The most widespread services reduces the effectiveness of urban mobility mode of transport is walking, despite a common systems. In developing cities, motorized private vehi- reality of poor sidewalk infrastructure. Many other cles are not affordable to most of the population, but trips are served by “informal” transit consisting of infrastructure that supports them have historically minibuses, small car fleets, rickshaws (3-wheelers), received most of the public investments. Most impor- motorcycles, and bikes operated by fragmented tantly, the social and environmental externalities of and often underregulated private providers. These travel by fossil fuel-powered private vehicles have not informal transit services are a market response been fully accounted for. It is within these complex 9 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH and vibrant urban contexts with underregulated ICT-enabled mobility services and incorporate higher mobility markets that “ICT-enabled mobility services”1 societal goals for social inclusion and climate action have emerged. into its framework. Being user-centric means rec- ognizing the needs of the poor in developing cities, City governments—with different regulatory frame- including affordability, geographical coverage, and works, institutional capacities, and built environ- accessibility to jobs and services. ments—have struggled to adapt to the changing mobility market. They must quickly equip themselves MaaS provides an opportunity to integrate informal to understand the challenges and opportunities of transit services and ICT-enabled mobility services the emerging data- and technology-driven mobility in emerging economies. This integration, however, world and steer it towards social, environmental, also presents the biggest challenge of MaaS in this and economic goals. Towards this end, the concept context—in particular, data integration, service of Mobility-as-a-Service (MaaS) can serve as an orga- integration and policy integration. In this way, MaaS nizing framework for understanding and shaping is much more than a technological platform; it is an how multiple mobility options can work together to enabling environment of information exchange and advance sustainable mobility and development goals. governance that accounts for the externalities of MaaS aims to enable multimodal travel and proposes different modes, providing an integrated and level a customer-centric, and access to service-oriented playing field for mobility service provision. paradigm shift. Traditionally, customers have been required to own or purchase their means to travel MaaS’s reliance on technology can either exacerbate (e.g., private cars or bicycles). The vision of offering mobility equity issues or catalyze efforts to bridge ‘mobility-as-a-service’ is to upend this need for own- the digital divide in emerging economies. While ership and instead empower customers to access the emerging economies may lag in the implementation most optimal mode (or modes) of travel on a trip-by- of the technologies that underpin MaaS, the business trip basis. To date, the effects of ICT-enabled mobility opportunities and societal benefits created by MaaS services on car ownership have not been significant should validate strategic investments to bridge the in developed countries; however, if planned with digital divide and leverage global innovation. Issues intention, MaaS implementation in developing cities surrounding universal access to smartphones, could reduce the pressures of motorization that are banking systems, and other financial technologies in projected to come with economic growth. emerging economies should not be seen as obsta- cles to the implementation of MaaS (which is built To make a meaningful and positive impact in devel- on these systems). These issues should instead be oping cities, MaaS needs to expand its target cus- viewed as motivators of broader efforts to ensure tomer base beyond current higher-income users of technological inclusivity and access to banking 1 ICT-enabled mobility services or simply ICT mobility services are sometimes called “new mobility”, “emerging mobility”, or “innovative mobility” services. For the purposes of this report, we use the former as a more precise and long-lasting terminology, since the vehicles types and many of the services have been around for more than a decade (e.g., bicycles or car-sharing) and are therefore no longer “new” or “emerging.” 10 MOBILITY AND TRANSPORT CONNECTIVITY SERIES among the bottom 40 percent.2 In fact, MaaS imple- sector to act as a facilitator and will rely on the devel- mentations in the developing world can embrace opment of analytical capacity, flexibility to try new local innovations such as mobile payments and super models, and persistence to reform the regulatory apps to help expand access. environment to provide a level playing field across all existing and new modes and services. Government intervention will be crucial to ensure MaaS interventions achieve strategic policy goals in This report contextualizes the concept of MaaS for emerging economies. While MaaS and ICT-enabled cities in low- and middle-income countries, discuss- mobility services may be seen as marginal services ing how this powerful framework may advance diverting resources from advancing core transpor- sustainable mobility and development goals. It tation policy goals, the reality is that government demonstrates how all four policy objectives under action in shaping this space can have a transfor- The Global Roadmap of Action towards Sustainable mational impact. In fact, MaaS could be a strategic Mobility (Sum4All 2019)—universal access, efficiency, intervention that provides an opportunity for internal safety, and green mobility—can be advanced effec- capacity-building, acts as a catalyst for innovative tively through the introduction of MaaS. This report regulation and planning, and a signal to the market also acknowledges that doing so requires govern- of where government wants the industry to evolve. ment leadership, systematic thinking around societal goals, and new technical capabilities—all important To take advantage of the full range of ICT-enabled capacities that may not be readily available in mobility services in an integrated way, MaaS gover- developing cities. This report is intended to facilitate nance must be outcomes- and goals-oriented. MaaS discussion on the critical issues involved in deploying governance must also strike a balance between pric- MaaS from the perspectives of supply, demand, tech- ing negative externalities and promoting innovation nology, business, and governance. and new market entrants. This will require the public 2 The bottom 40% corresponds to the first two quintiles of the wealth distribution. The World Bank mission is to end extreme poverty and boost shared prosperity. Boosting shared prosperity is a newer development objective coming from the alarming increase in income inequality in the developed and developing world. 11 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH KEY TAKE-AWAYS This report positions MaaS as a framework for under- take-aways regarding the implementation of MaaS standing data- and technology-enabled mobility in developing cities from the perspective of mobility services, mitigating the risks they bring, and shaping supply and demand, enabling technology, business their deployment to align with social, environmen- models, and governance. tal, and economic goals. Here we synthesize key SUPPLY • MaaS aims to integrate a broad spectrum of mobility services. These include formal and informal public transit, taxis, biking, and walking, as well as ICT-enabled mobility services, such as ridesourcing, microtransit, car-sharing, bike-sharing, and scooter-sharing. Public transit operates as the anchor mode, complemented strategically by the other modes. • MaaS providers can be a simplifying link between users and mobility ser- vices. The MaaS provider is a new actor in the mobility ecosystem charged with developing the products and technologies that bring together various mobility services onto a single platform. • MaaS offers a framework through which all mobility services can contribute to larger policy goals. Integration through MaaS leverages each mobility mode and service where it is most efficient, creating a more symbiotic system that advances multifaceted benefits. • Bringing informal transit providers onboard is one of the greatest opportu- nities for MaaS implementation in developing cities. However, informality, the fragmentation of operations, and a complex stakeholder ecosystem are some of the main challenges for advancing towards integration—particularly data integra- tion, service integration, and policy integration—of the MaaS transport system. • Infrastructure needs to mirror the policy vision fostered by MaaS schemes. For efficient public transit, biking, and walking to provide the anchor for multi- modal urban mobility systems, cities require robust, high-quality infrastructure networks that appropriately allocate space to different modes and services. Intermodal integration also requires careful coordination of transfers among different modes. 12 MOBILITY AND TRANSPORT CONNECTIVITY SERIES DEMAND • Traveling around urban centers in emerging countries is fraught with barri- ers. Travelers in developing cities often face an unsafe, insecure, time-consuming, unreliable, crowded, expensive, and inaccessible trip. All these elements affect an individual’s ability to access opportunities such as employment and education. Transport is a critical barrier to stepping out of poverty. • MaaS has a key role to play in developing countries—delivering improved mobility for target demographics and helping to meet climate and air qual- ity goals. To offer successful customer-centric services, MaaS schemes need to respond to current travel patterns, land use patterns, and affordability constraints of developing cities. • MaaS can help change urban mobility from an ownership paradigm to an access to services paradigm. MaaS may influence travel choices by reducing information asymmetry, incorporating pricing or other signals to nudge travel behavior, and offering alternatives to car ownership. In fact, in developing cities, there may be an even greater opportunity for MaaS to help avoid motorization compared to in high-income cities with more established car ownership. The 13 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH ability that MaaS has to nudge behavior away from private car ownership and use is dependent on recognizing and meeting unique user needs and supporting service-based approaches through complementary investment in infrastructure and implementation of reinforcing policy measures (such as transport demand management3). • Governments have a central role in shaping MaaS to align with societal goals and to use it to encourage sustainable lifestyles. Governments should partner with MaaS providers and actively lead initiatives to achieve meaningful results, coupling the behavioral nudging potential of MaaS schemes with green infrastruc- ture investments. • Early adopters of ICT-enabled mobility services are likely to be early adopt- ers of MaaS, raising concerns about equitable access. In developing countries, many of the features of these ICT-enabled mobility services appeal to higher-in- come groups; their location, price, and payment mechanisms favor those users. However, there are a few examples of services that target the poor and are partic- ularly conscious about affordability. • There are not enough MaaS pilots focusing on lower-income groups, and governments should support initiatives that generate positive societal impacts. MaaS has a role in expanding the choice set of the poor by offering new or improved alternatives. This can expand access to employment opportunities, education, health care, and other services. • MaaS could have a prominent role in mitigating climate change and public health crises such as Covid-19 and supporting the “building back better” initiative. MaaS schemes and the ICT-enabled mobility services that are a part of them can reduce emissions and improve air quality if the systemic impacts of transport are appropriately accounted. This means focusing on complementarity with formal and informal public transit services (serving the first-/last-mile) and substitution of private vehicle ownership and use (replacing more polluting modes). MaaS may also support “building back better” in the wake of the Covid-19 pandemic by better matching user demand and service supply, supporting tele- activities that curtail the need for travel, and nudging users into green choices of transport, such as public transit and active modes with appropriate safety precau- tions. Governments should support initiatives that target these objectives. 3 Transport Demand Management (TDM) includes a set of incentives and disincentives to influence travel behavior and measures include pricing mechanisms (fuel tax, parking, congestion pricing) and social marketing mechanisms (communications, corporate incentives, telework policies). 14 MOBILITY AND TRANSPORT CONNECTIVITY SERIES TECHNOLOGY • Technology is at the heart of the rise of MaaS. Technology is critical for the integrated, multimodal, multi-provider products and services that deliver MaaS as well as many of the ICT-enabled mobility services implemented in the last decade. • MaaS platforms are the integrated technological structures and services necessary to offer MaaS products. MaaS platforms aggregate, distribute, process, and validate all flows of data and payments among policymakers and regulators, mobility service providers, and other actors participating in the MaaS scheme, while providing a seamless experience to the user. • Data adequacy, compatibility, and security are fundamental to the viability of MaaS platforms. To ensure such viability, four aspects need to be considered: (i) high quality data availability, (ii) data standardization, (iii) interoperability by design, and (iv) security, privacy, and ownership agreements. • Financial technology (fintech), digital payments, and ticketing are critical considerations in the deployment of MaaS platforms. Given that payments have to be integrated within a MaaS platform, fintech plays a key role in MaaS deployment. From allowing in-app payments to mobility bundles and incentive systems, they enable higher levels of multimodal integration in MaaS schemes as well as new business opportunities for participating actors. While lower-income individuals have often found it difficult to access many online banking applications, new advances in mobile payment and alternatives such as smartcard systems can help overcome this barrier. • Two new trends facilitate ticket and payment integration in MaaS platforms: Open loop payments and account-based ticketing. • Many governments and other parties with limited experience in the devel- opment of digital applications tend to underestimate the resources required to successfully deploy and operate MaaS platforms. Considerable time and monetary resources are necessary to provide streamlined and user-friendly trip information, ticketing, and payment systems. 15 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH BUSINESS • MaaS business models offer a compelling value proposition to each partic- ipating actor. Customers, mobility providers, MaaS providers, and government agencies can each benefit from the MaaS scheme in different ways. • MaaS business models require establishing multiple revenue streams. In order to cover the costs of service provision and offer attractive fares to cus- tomers, MaaS businesses commonly develop other revenue sources such as ancillary customer services, advertising revenues, data revenues, and government subsidies. • MaaS business models are often first implemented as pilots. This approach allows all participating actors to identify unforeseen barriers to implementation, to assess the long-term viability of the business model, and to make any necessary adjustments. However, pilots should not be the end goal. MaaS schemes should be implemented with the goal of scaling up and making permanent successful interventions. • There is a solid business case for MaaS in developing cities. There is a glaring demand for improvements in mobility and accessibility that MaaS could deliver, and numerous ICT-enabled mobility services have already proven their viability in these contexts. However, there are a number of strategic interventions—including improvements to existing transport infrastructure and new regulations around innovation and integration—that are necessary to potentiate the MaaS industry, which require government action. 16 MOBILITY AND TRANSPORT CONNECTIVITY SERIES GOVERNANCE • The public sector has faced a great challenge with the rapid rise of ICT-enabled mobility services. The public sector has almost been caught by surprise with the disruptive force of these services and has frequently been either too passive or too interventionist in the regulation of ICT-enabled, private sector-led mobility services, often as a result of an outdated regulatory environment unwelcoming to innovation. • Regulations of MaaS should focus on desired outcomes and principles, rewarding positive impacts and taxing negative externalities. For MaaS to achieve the ambitious goals of improving mobility, accessibility, equity, and sustain- ability, it is important that governments prepare for and proactively shape mobility service and technology innovation through mode-agnostic regulations, space allo- cation, and pricing schemes that reward travel that is greener, more efficient, and inclusive. To achieve these goals, policies that disincentivize private car ownership and use are especially important for the success of MaaS. Financing and funding mechanisms must be made available as a result of these regulations. • Any MaaS governance and regulatory framework in developing countries needs to address information, payment, and service integration, but also equity and climate considerations. The governance framework of MaaS can span from a hands-on format—where mobility providers connect to a government-run platform—to an open network of providers of transport, information, payments, and maps—where the government’s role is to coordinate rules and standards, nudging positive behaviors and curbing negative externalities. In either case, the arrangements and policies should not stop at a neutral integration model; instead, they should explicitly embed societal goals through, for example, prioritization of investments, subsidies, and allocation of space to the most efficient and green modes. • Data is the new regulatory currency in the MaaS governance framework. Managing this new paradigm will require the public sector to gain new skills, partic- ularly around the development and use of technology. Data standardization, shar- ing, integration, storage, and privacy are all elements that the public sector must either facilitate through regulation or undertake to improve the success of MaaS. • A specialized agency will likely be necessary for MaaS to thrive. A MaaS agency, potentially evolving from an existing Metropolitan Transportation Authority (MTA), must have jurisdiction over all modes, with a focus on system and service integration. Data analytics will be a key component of this new agency, which should be capable of assessing impacts on each part of the system and be empow- ered to innovate, conduct pilots, and propose regulations. 17 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH 1. Introduction 18 MOBILITY AND TRANSPORT CONNECTIVITY SERIES KEY TAKE-AWAYS FROM THE INTRODUCTION • Mobility-as-a-Service (MaaS) aims to enable multimodal travel. The grow- ing ecosystem of urban mobility services that combine traditional modes like public transit and taxis with ICT-enabled mobility services like ridesourcing, car-sharing, bike-sharing, and scooter-sharing, can accommodate almost any travel need within the city. MaaS seeks to bring together these various services within an integrated platform. • MaaS proposes a customer-centric paradigm shift. Traditionally, customers have been required to own or purchase the means to travel (e.g., private cars or bicycles). The vision of offering ‘mobility-as-a-service’ is to upend this need for ownership, and instead empower customers to access the most optimal mode (or modes) of travel on a trip-by-trip basis. • MaaS should be approached as an expansive concept. While many try to place strict definitions and boundaries around MaaS, the concept proves to be more powerful when used with freedom and flexibility to adapt it to different needs, situations, and contexts. • MaaS provides a powerful framework to help define and advance sus- tainable urban mobility goals, including universal or inclusive access, efficiency, safety, and green mobility (Sum4All 2019). Doing so will requires proactive government leadership and vision. Providing mobility services that not only satisfy the diverse needs of people, but also minimize externalities has proven to be a challenge for developing cities. Technology, innovation, and integration through MaaS can simplify advancing to a more inclusive, efficient, safe, and green mobility system. A strong, well informed, and tech savvy gov- ernance framework and supportive regulation and infrastructure investments will all be needed to achieve this vision. MAIN OPPORTUNITY/CHALLENGE The growing influence of private, for-profit mobility technology and service providers in urban transport is a double-edged sword. Left unchecked, it can have very negative impacts in terms of growing congestion, worsening road safety, and leaving vulnerable populations behind. Conversely, MaaS proposes a holistic framework to proactively shape ICT-enabled mobility service to serve as part of a multimodal transport system to improve citywide mobility efficiency, safety and equity. 19 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH 1.1 The context and vision for MaaS in developing cities Cities are one of the main drivers of economic Over the last decade, technology has become growth in developing countries, but longstanding a more integral part of urban mobility service urban mobility challenges limit their potential. delivery, expanding accessibility for some but Growing congestion and increasing travel times, raising concerns over who may be left out. worsening levels of pollution and carbon emissions, Advancements in information and communications and escalating numbers of road traffic crashes have technologies (ICT), including global positioning been, in varying degrees, common trends for most systems (GPS), smartphones and expanding 5G cities around the world. Some cities have confronted connectivity, internet of things (IoT), and improved these challenges by investing in their mass transit computational power, have unlocked new opportu- and active mobility systems, and by implementing nities for innovative urban mobility service delivery various travel demand management policies; how- (Shaheen and Cohen, 2018). With a smartphone in ever, much more effort is needed in these areas to hand, customers can now access multimodal trip keep up with rapidly growing urban populations and planners enhanced with real-time information on motorization rates. vehicle arrival times and estimates of trip travel time and cost. The shared mobility model was able 20 MOBILITY AND TRANSPORT CONNECTIVITY SERIES to go station-less, with e-bikes and scooters added essential opportunities for a thriving life if they to the suite of available services. And on-demand could use the traditional modes of public transit ridesourcing services developed into a popular mode and the growing number of ICT-enabled mobility of transport for urban dwellers. Overall, the menu services. Moreover, what if governments and private of mobility services available within a city diversified providers collaborated to create new services and and expanded (see Chapter 2. Supply), creating new programs purposefully designed to address the big- possibilities for reimaging urban travel. At the same gest mobility gaps experienced by low-income citi- time, use of these services is often concentrated zens in each city? Wouldn’t it be a game changer if, in among higher-income individuals (see Chapter 3. areas where and when fixed-route transit coverage is Demand) and digital, financial, and technological inefficient, people could book a ridesourcing service barriers to adoption still exist. to take them to the nearest transit hub and only pay a single fare for the whole ridesourcing-plus-transit In developing cities, low-income citizens still trip? How many additional trips would low-income depend on walking and public transit as their pri- people make on a monthly basis if they could just mary modes of travel. The most widespread mode of pay an affordable flat fare that allowed them to use transport is walking, despite a common reality of poor transit, bike-share, scooters, ridesourcing, and car- sidewalk infrastructure. Many other trips are served share, almost indiscriminately and according to their by “informal” transit consisting of minibuses, small car needs for each trip? fleets, rickshaws (3-wheelers), motorcycles, and bikes operated by fragmented and often underregulated This is how we must envision Mobility-as-a- private providers. These informal transit services are Service (MaaS) in developing cities—not as the a market response to people’s unmet mobility needs, indulgence of the well-to-do that exacerbates but are often unplanned and undercapitalized, neg- the inequities, inefficiencies, and externalities of atively affecting safety, comfort, and environmental our urban mobility system (like private cars and and operational efficiency. In cities in middle-income most ICT-enabled mobility services today), but countries, these informal transit services mix with for- as a framework for supporting public transit and mal public transit services, such as metros, bus rapid active mobility and shaping private sector ini- transit (BRT), and formalized bus services, as well as tiative and technology to liberate those that are exponentially growing fleets of cars and motorcycles. currently restricted by their mobility options and However, it is often the case that the low-income users to advance other core policy goals like safety and of these public transit services—those that rely on climate change mitigation. Achieving this vision them the most—endure the lowest quality of service will require governments to invest in infrastructure, due to long journey times and many transfers needed reprioritize urban space, and, above all, build capac- to journey from their peripheral settlement to their ity and regulations to ensure a strong governance places of work or other destination. framework around innovation, data, and technolog- ical deployment. Putting in this work towards MaaS Now, let us imagine how much we could amplify can bring benefits during the transition and the end the ability of low-income people to access result could be well worth the resources. jobs, education, health services, and any other 21 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH 1.2 The tenets of MaaS The idea of MaaS was first developed in Europe car- and bike-share memberships, or one’s own in the 1990s as a way to integrate urban mobility private car. Each product and service has been services and enable customers’ ability to choose conceived independently of the others, and, as the most optimal mode of travel for any given a result, customers have always born the ineffi- trip. Recent innovations have facilitated the actual ciencies and additional costs of the discrepancies implementation of MaaS. Urban mobility services between their holistic travel needs and these have continued to diversify through the last decade. discrete mobility offerings. By combining walking, bicycling, mass transit, and taxis with innovative, ICT-enabled services—like ride- • Multimodal travel may address some of sourcing, car-sharing, bike-sharing, and scooter-shar- those inefficiencies. To respond to increasingly ing—multimodal systems could accommodate demanding clients, who aspire to high-quality almost any travel need within the city irrespective of door-to-door mobility services and have increas- origin, destination, time of day, trip purpose, etc. ingly complex travel demand patterns, no single mode of transport will ever be the most efficient There are various definitions of MaaS, as private solution for all trips. By creating new services and providers, governments, and academic institu- products that integrate various modes of trans- tions around the globe work to further develop port, MaaS aims to liberate customers from the and implement the concept. These definitions inefficiencies of the classic paradigm. By offering differ primarily in where they set the boundaries of multimodal trip planning services, integrating what qualifies as MaaS and what does not. For exam- multi-provider single trip fares, and bundling ple, some define MaaS simply as the smartphone app mobility services into monthly subscriptions, for planning, booking, and paying all mobility ser- the underlying idea of MaaS is to leverage the vices in a city; others use the term more expansively strength of the growing number of mobility ser- to describe an integrated, multimodal, multi-provider vices in each city to facilitate customers’ ability to mobility system; and still others place MaaS some- choose the most optimal door-to-door service for where in between those two prior definitions, or give each trip. special attention to specific elements of the overall experience. • Technology enables a single user interface. Most ICT-enabled mobility services rely on Differences aside, most definitions of MaaS share smartphone apps as the primary customer a common vision built around a few central ideas. interface. Under MaaS, the goal is to assemble These include: mass transit, other traditional services, and ICT- enabled mobility services under an integrated • The classic mobility paradigm is inefficient. app. The vision is to be able to plan, book, and pay Traditionally, mobility has required ownership and for a wide range of multimodal, multi-provider consumption of discrete, single-mode products trips through a single interface. An integrated and services—e.g., individual bus passes, separate app also facilitates the centralization of other 22 MOBILITY AND TRANSPORT CONNECTIVITY SERIES key features for MaaS, such as customization of across service options for each trip. Therefore, the user preferences (e.g., common destinations, key benefit of MaaS for users is its integration of preferred modes, fare, travel time, and environ- different modes and mobility services. mental impact), tallying of service use and loyalty benefits, and offering of strategic incentives to MaaS schemes can be categorized according to nudge individuals’ travel behavior towards more the types of integration that they provide across sustainable outcomes. modes and mobility services. Each type of integra- tion can bring significant improvement on its own. • A customer-centric paradigm shift. MaaS But, if implemented together, they can build on and strives for ultimate customer empowerment. reinforce one another. The more multimodal and Transport is a derived activity, meaning that the integrated the system, the more mature the state of main goal for customers is to get to destinations, MaaS (see Figure 1). Foundational to any successful not to own cars or ride in a bus. MaaS aims MaaS scheme is the integration of mobility service to overturn the traditional ‘ownership’ model provision with societal and environmental goals. and allow for customers to consume ‘mobili- Other types of integration involved in MaaS include ty-as-a-service’—providing the ability to get to integration of information, booking and payment, their desired destination in the most optimal and of service operations. way possible every time. Through this paradigm shift, customer needs are placed at the center, MaaS builds on concepts that are already suc- and the onus of integration and creating efficient cessful within mass transit systems. For example, multimodal services and fare products is born by many mass transit systems already offer integrated the planners and operators of the whole urban fares across multiple services (e.g., bus and rail), mobility system. allowing for free or discounted transfers within a single trip as well as weekly or monthly passes. The MaaS vision is to include additional modes to these integrated fare schemes to unlock greater benefits 1.3 Types of integration and for individual customers and society. For instance, for a single trip, pairing transit with an ICT-enabled other basic concepts mobility service for the last mile could extend the overall coverage of public transit service within the Traditionally, each mode of transport and service city and provide additional efficiency and personal offered to the public is planned and operated safety benefits. Across multiple trips, the vision is independently of other modes. Government to offer easy access to car-share, bike-share, scoot- agencies and mobility providers do not assume er-share and ridesourcing to complement transit any responsibility in facilitating multimodal travel; when it is not the most effective option. instead, the onus is on each individual to compare 23 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Figure 1. Types of integration involved in MaaS schemes Integration of societal and environmental goals Integration of information The potential of integrated, multimodal mobility MaaS relies on the integration of information to pro- must be leveraged proactively to advance strategic vide value to users. MaaS schemes need to be able policy and sustainability goals, such as improving to access information (e.g., routes, schedules, real- access for marginalized groups, or reducing trans- time vehicle locations and estimated arrival times, port GHG emissions. Government engagement in etc.) on various modes and services in an integrated service deployment, structuring subsidizing, and platform. With information integration the customer designing new regulations is crucial to enable new can determine what is the optimal solution for their service combinations that otherwise would not come desired trip from a variety of choices. Multimodal trip about organically under regular market conditions planning services like Google Maps, Citymapper, and (Noussan and Tagliapietra, 2020). Transit App exemplify this type of integration. Integration of booking and payment Integration of mobility service operations Another type of integration is the integration of The final type of integration is the integration of booking and payment features. For example, at the different mobility services. Bringing multiple oper- individual trip level, customers can pay a flat fare for ators into a single platform allows for innovation in an integrated transit-to-ridesourcing trip; at the multi- combining services and packaging mobility products. trip level, customers can purchase multimodal mobil- This integration involves cooperation among mobility ity subscriptions, bundling access to various modes providers regarding service schedules, pick-up and and services within a given timeframe. In some cities, drop-off locations, and other decisions that provide MaaS platforms offer these features directly; in other users with a seamless door-to-door travel experience places, the MaaS platform links to transit agencies across modes. and ICT-enabled mobility service provider apps, which offer booking and payment for the subset of modes and services they operate. Source: Modified from Socher et al. (2018) 24 MOBILITY AND TRANSPORT CONNECTIVITY SERIES There are other basic concepts central to iii. The backend layer that integrates each mobil- understanding MaaS that may be new for many ity service provider into the platform, and exe- transportation professionals. Below we offer brief cutes data flows, trip requests, and payments. definitions of these basic concepts to facilitate com- prehension before these concepts are discussed in • Application Programming Interface (APIs). more detail in the chapters ahead. Namely, the means of communication and inter- face between each individual mobility service • Mobility service providers. This refers to all provider and the MaaS platform. actors offering mobility services to the public, including both classic mobility services like mass transit or taxis and ICT-enabled mobility ser- 1.4 The big picture vices like ridesourcing, car-share, bike-share, or scooter-share. The arrival of ICT-enabled mobility services has posed important challenges for cities. ICT-enabled • MaaS scheme. A MaaS scheme means some form mobility services may have improved mobility and of service that facilitates multimodal, multi-pro- accessibility for many individuals but have also vider mobility. brought with them negative externalities for the city. For instance, ridesourcing services have added thou- • MaaS provider or MaaS operator. The actor sands of cars roaming for passengers to what were responsible for developing the MaaS scheme and already heavily congested streets (Rodier, 2019); offering it to the public. Different types of actors shared bikes and scooters are often left recklessly on may take on the MaaS provider role, including sidewalks and streets, endangering pedestrians and government agencies (e.g., UbiGo in Sweden or other users of the right-of-way; and these services Kochi One in India), mobility service providers often compete with public transit and taxi services. (e.g., Uber), and 3rd party actors (e.g., Whim). ICT-enabled mobility services have also had a • MaaS platform. This refers to the requisite poor record addressing the needs of some of the structure to implement a MaaS scheme, which can most vulnerable populations, spotlighting exist- involve very intricate flows of data and payments ing equity and safety issues already prevalent between various actors as well as substantial data in traditional mobility services. To name a few storage and processing capabilities. As described very concerning examples: ridesourcing passengers, by Kanda (2019), the main layers in a MaaS plat- particularly women, and drivers have been victims of form are: crimes and acts of violence; most ICT-enabled mobil- ity services lack adequate provisions to make their i. The customer interface (e.g., an app or a services accessible for people with disabilities; and, website); many low-income citizens cannot afford the smart- phone and data plan required to use these technol- ii. The mobility marketplace that enables cus- ogy-enabled services, or, if they do, their typical fare tomers to plan, book and pay for products and levels still render them unaffordable. services across multiple service providers; and 25 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH MaaS can provide governments with a multimodal policy framework for addressing the challenge of providing green, safe, efficient, and inclusive Efficiency mobility (Sum4All, 2019). In dense urban areas, MaaS UNIVERSAL ACCESS EFFICIENCY SAFETY GREEN should place fixed-route mass transit as its core ser- The first pillar in MaaS’s approach to efficiency is vice, since it is an efficient, equitable, and sustainable multimodality. Certainly, there are great inefficien- method of serving passenger trips. Accordingly, cies in trying to satisfy customers’ evermore complex an urban MaaS policy perspective requires that travel demand patterns with any single mode. By ICT-enabled mobility services are regulated or creating new services and fare products that enable incentivized so that they do not weaken transit, but multimodal travel, MaaS aims to nudge customers instead help strengthen it. In lower density areas away from inefficient mode choices (including private often underserved by fixed-route mass transit, MaaS car use), leading to costs savings for customers, can help leverage technology and coordination to providers, and society at large. The second pillar is improve existing mobility services and expand mobil- technology. Through data sharing frameworks and ity options. Within the urban mobility realm, MaaS readily available user interfaces (apps, websites, advances each of those goals in the following ways. control centers), MaaS renders all mobility services more visible to both customers and government authorities; this derives into improved adherence to performance standards and enhanced service reli- Universal Access ability for customers. UNIVERSAL ACCESS EFFICIENCY SAFETY GREEN MaaS is as a vision for expanding access to mobility services to all—be it geographically to lower density areas, at non-peak hours of the day, and to those Safety needing special provisions for accessibility, afford- ability, or personal security. UNIVERSAL While, individually, ACCESS EFFICIENCYthe SAFETY GREEN cost of those types of service expansions and special MaaS schemes will need to be complemented by provisions might make them less viable due to lower infrastructure investments and regulations to achieve demand, MaaS’s holistic perspective and integrated real safety benefits. By encouraging multimodal trips frameworks for service planning, operations, flow and putting public transit and active mobility at the of payments, and resource allocation opens up new heart of travel, MaaS may reduce vehicular travel and pathways to advance universal access. Similarly, its associated deaths, injuries, and crashes from road from a MaaS perspective, the system as a whole is traffic. This would require improvements in infra- responsible for establishing fees and cross-subsidy structure investments and regulatory provisions to mechanisms so as to offer equivalent levels of make multimodal travel safer, for example through service to people with disabilities and create special the expansion of protected facilities for pedestrians multi-provider service features like call-in options and and cyclists. Additionally, MaaS has the potential to smartcards that bring the MaaS experiences to all. enhance personal safety for users by empowering 26 MOBILITY AND TRANSPORT CONNECTIVITY SERIES them with real time information about schedules and respective contexts. In turn, ICT-enabled mobility vehicle arrival times, facilitating the use of a broader services have been adopted by the public, bringing number of mobility options when needed, and by about similar improvements in personal mobility for establishing systemwide protocols and standards many, as well as similar complexities in terms of effi- that prioritize customer safety. cient and safe citywide transport system operations. MaaS provides a clear framework to improve Green Mobility mobility and accessibility for the bottom 40 per- cent in emerging economies. Perhaps more so than in any other part of the world, in emerging economies GREEN Green. MaaS can help design integrated, multimodal, mass transit services offer a basic lifeline for millions multi-provider urban mobility systems that provide of low-income citizens to access jobs and provide for convenient and flexible alternatives to private car their families. MaaS is a strategy for strengthening ownership and use. The broader and more diverse mass transit and expanding its benefits to those the set of services included in a MaaS scheme, the whose needs are greatest through multimodality and more likely its ability to meet the needs of all users. integrated frameworks for resource allocation. The And, if implemented with public transit and active only requisite to center MaaS around its impact to the mobility at the core, MaaS systems have the potential bottom 40 percent is government’s leadership to do to significantly reduce carbon emissions and pollu- so. Governments can, for example tion. MaaS apps and other customer interfaces can also provide customers details on the environmental i. create regulations requiring an alternative to the impact of the mobility services available before they MaaS smartphone app, such as a smart card, and select them and tally their total carbon and pollutant facilitate adoption by all mobility service providers; emissions over a given time—all in an effort to nudge ii. raise congestion fees on ridesourcing and other customers towards greener travel practices. MaaS car-based trips and reinvest those funds to platforms can also be used by government agencies improve public transit services; to deploy new services and pricing and taxation strat- egies that help advance their environmental goals. iii. allocate street space to prioritize walking, biking, and public transit services which serve the major- Emerging economies have not been left at the ity of trips of low-income people; margin of the surge of ICT-enabled mobility services and technological innovations. Many ICT- iv. invest in developing innovative services—lever- enabled mobility service providers operate at multi- aging ICT-enabled mobility service providers—to national levels and utilize the same state-of-the-art address the needs of low income citizens residing technologies across all their client cities. Additionally, in areas of poor transit coverage; and home grown companies have also emerged in these markets, often demonstrating greater savvy about v. subsidize mobility subscription bundles targeting customer needs and unique opportunities in their the needs of the bottom 40 percent. 27 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH MaaS offers a playbook for providing mobility during the Covid-19 pandemic without increas- 1.5 Our report ing contagion risks or exacerbating private car dependence. While most countries have ended their This report examines MaaS from the perspectives quarantines and stay-at-home orders, the Covid-19 of supply, demand, technology, business, and pandemic will continue to be a decisive element governance. Our intent is to offer a general under- of day-to-day life for urban dwellers for months to standing of how these various perspectives contrib- come. Many white-collar workers will continue work- ute to MaaS and the ways in which they interact with ing from home, but a growing number of people, one another. Throughout the report, we analyze particularly in emerging economies, have already or issues around the emergence of ICT-enabled mobility will go back to traveling daily to their places of work. services and the ways in which they can transform Many cities across the world have already responded the way people move about cities in the years and to this challenge by adopting basic strategies aligned decades to come. A central message in this report is with MaaS, such as turning general traffic lanes into that government engagement, or lack thereof, will bus lanes and bike lanes, staggering work hours determine whether that transformation improves while re-opening businesses, or implementing the lives of the bottom 40 percent and helps revert technology-enabled, flexible services that ensure the growth of carbon emissions from transport, responsiveness and safety for Covid-vulnerable pop- or if it worsens the inequities and environmental ulations. Additional measures could also unleash the degradation that traditional urban mobility practices power of technology to track crowding data, consider have caused for decades. Managing mobility and contact-distance needs in trip planning, and support providing services that not only satisfy the needs contact-tracing programs. of all people, but also minimize externalities has proven to be a great challenge for developing cities. The current Covid-19 pandemic and its impacts Technology and innovation could help cities progress on the urban transport sector emphasize the towards sustainable mobility goals, but a strong, need for boldness and creativity in the solu- well-informed, and technology-savvy governance tions we pursue. City governments and other key framework will have to be put in place and a sup- stakeholders in urban mobility can learn a lot from portive urban environment will have to be designed. piloting new ideas and making strategic adjustments We propose that MaaS offers a holistic framework according to customer response and the evolution of to catalyze public sector action and leverage private the pandemic. In time, there will be great pressures sector innovation towards desired policy outcomes. on cities to revert to pre-Covid right-of-way alloca- tions and other regressive practices. It is incumbent The road ahead is unknown but exciting, chal- upon urban mobility coalitions in each city to protect lenging but filled with great potential. We believe the terrain gained, and to use it to launch the full- that thriving during this pandemic, and in the years fledged visions of a multimodal MaaS framework in that will follow, will require cities to embrace ongoing the years to come. 28 MOBILITY AND TRANSPORT CONNECTIVITY SERIES experimentation and eventually scale their unique our collective expertise on MaaS, to promote door- approaches to MaaS; therefore, this publication is to-door travel by low-carbon modes, and to develop an invitation to collaborate and forge new alliances strategies together to design MaaS so that it results to create the future of sustainable urban mobility in a tangible improvement in the lives of the urban together. Our commitment at The World Bank is to poor. This report is the first step in this collective be a strategic ally to our client countries and other learning journey. stakeholders interested in MaaS, to further build References Kanda, Tomoko. 2019. Advancing Mobility-as-a-Service: Lessons Learned from Leading-Edge Public Agencies. Report No. LAS1904. Institute of Transportation Studies, University of California Los Angeles. https://escholarship.org/uc/ item/6cv8m38s Noussan, Michel, and Simon Tagliapietra. 2020. The effect of digitalization in the energy consumption of passenger trans- port: An analysis of future scenarios for Europe. Journal of Cleaner Production 258, 120926. https://doi.org/10.1016/j. jclepro.2020.120926 Rodier, Caroline. 2018. The Effects of Ride Hailing Services on Travel and Associated Greenhouse Gas Emissions April 2018. A White Paper from the National Center for Sustainable Transportation Institute of Transportation Studies, University of California, Davis. https://escholarship.org/content/qt2rv570tt/qt2rv570tt_noSplash_11ef3f6f9b4f64f6cd7730c9faf5cca8. pdf?t=qenf5z Shaheen, Susan, and Adam Cohen. 2018. Shared ride services in North America: Definitions, impacts, and the future of pooling. Transport Reviews. pp. 1-17. https://doi.org/10.1080/01441647.2018.1497728 Sochor, Jana, Hans Arby, I.C. MariAnne Karlsson, and Steven Sarasini. 2018. A topological approach to Mobility as a Service: A proposed tool for understanding requirements and effects, and for aiding the integration of societal goals. Research in Transportation and Business Management 27, 3–14. https://doi.org/10.1016/j.rtbm.2018.12.003 Sum4All [Sustainable Mobility for All]. 2019. Global Roadmap of Action towards Sustainable Mobility. Washington, DC. 29 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH 2. Supply 30 MOBILITY AND TRANSPORT CONNECTIVITY SERIES KEY TAKE-AWAYS FROM THE SUPPLY PERSPECTIVE • MaaS aims to integrate a broad spectrum of mobility services. These include formal and informal public transit, taxis, 2- and 3-wheelers, and walking, as well as ICT-enabled mobility services, such as ridesourcing, microtransit, car-sharing, bike-sharing, and scooter-sharing. Public transit operates as the anchor mode, complemented strategically by the other modes. • MaaS providers are a new, simplifying link between users and mobility services. The MaaS provider is a new actor in the mobility ecosystem charged with developing the products and technologies that bring together various mobility services onto a single platform. • MaaS offers a framework through which all mobility services can contribute to larger policy goals. Integration through MaaS leverages each mobility mode and service where it is most efficient, creating a more symbiotic system that advances multifaceted benefits. • Infrastructure needs to mirror the policy vision fostered by MaaS schemes. For efficient public transit, biking, and walking to provide the anchor for multimodal urban mobility systems, cities require robust, high-quality infrastructure networks that appropriately allocate space to different modes and services. Intermodal integration also requires care- ful coordination of transfers among different modes. MAIN OPPORTUNITY/CHALLENGE FROM THE SUPPLY PERSPECTIVE Integration of informal transit in MaaS. Bringing informal transit provid- ers onboard is one of the greatest opportunities for MaaS implementation in developing cities. However, informality, the fragmentation of operations, and a complex stakeholder ecosystem is one of the main challenges for advancing towards integration—particularly data integration, service inte- gration, and policy integration—of the MaaS transport system. 31 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH In this chapter, we focus on how supply-side advanced equity and environmental outcomes. actors in MaaS schemes—the MaaS provider and Furthermore, Europe had high smartphone and participating mobility service providers—can internet penetration, and ubiquitous telecommuni- expand the number of mobility options for urban cations connectivity that facilitated the launch of ICT- residents. The supply side is of the utmost impor- enabled mobility services and new MaaS schemes. tance given that the mobility impacts of MaaS directly Other notable similarities among early MaaS depend on: (i) the range and quality of the mobility schemes included: (i) the integration of traditional services that are available and (ii) the number of ser- public transit with a wide range of additional mobility vices that are integrated in the MaaS scheme. services and (ii) the use of smartphone applications (apps) that provided pre-trip information, in-trip information, booking, and payment for users. 2.1 Early MaaS schemes MaaS schemes were commonly implemented in in Europe and super urban settings, but there is increasing interest in inner-ring suburban applications. Initial MaaS apps in Asia pilots focused on urban areas where there was a large potential user base, and where public transit, A combination of strong public transit systems, walking, and biking could serve the majority of key enabling regulations from the public sector, trips, supported by a variety of ICT-enabled mobility and growing connectivity facilitated the early services. However, more recently, there has been development of MaaS in Europe. European cities growing interest in applications in inner-ring suburbs generally have good quality public transit, which that are walkable but may lack high-quality, fixed- played an important role in structuring successful route public transit services. In less-populated, rural MaaS schemes. In Europe’s early developments areas there were fewer transportation options and, of MaaS there was active involvement from public as a result, fewer opportunities related to multimodal authorities in the design of mobility strategies that transportation integration. 32 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Early MaaS schemes pursued research and com- Among the non-European MaaS schemes, mul- mercial interests, proving to be very useful learn- timodal trip planners were some of the most ing experiences. Table 1 presents the main features successful early cases. For example, Google Maps, of some of the most prominent MaaS schemes first CityMapper, and Transit App (as well as many others) implemented in Europe; Box 1 presents a U.S. case. offered integrated trip planning and real time infor- Most early MaaS schemes were conceived as pilots, mation services across multiple countries. Transit focusing on learning from trial-and-error and there- App operates in several cities of Argentina, Australia, fore were not profit-driven. The MaaS provider could Canada, France, Germany, Iceland, Italy, New be a consortium of different actors (often the case in Zealand, Sweden, United Kingdom, and the United research pilots) or a specific company, for example, a States. In some cities, they even provided integrated telecom company. in-app booking and payment. Box 1. Mobility-on-demand: The MaaS-like concept trending in the USA In the United States, mobility-on-demand (MoD)—a concept similar to MaaS—is gaining momentum (Shaheen and Cohen, 2020a). The U.S. Federal Transit Administration (FTA) sees MoD as a way in which new service options can be combined with public transit using available technologies that allow for greater individual mobility. The goals of MoD include (FTA, 2020): • “Improving transportation efficiency by promoting agile, responsive, accessible and seamless mul- timodal service inclusive of transit through enabling technologies and innovative partnerships; • Increasing transportation effectiveness by ensuring that transit is fully integrated and a vital ele- ment of a regional transport network that provides consistent, reliable and accessible service to every traveler; and • Enhancing the customer experience by providing each individual equitable, accessible, travel- er-centric service leveraging public transit’s long-standing capability and traditional role in this respect.” Both MaaS and MoD focus on multimodal integration of public transit and ICT-enabled mobility ser- vices, see technology as an enabler of this integration, and put the user or traveler at the forefront of improvements. While many of the policy goals of MoD and MaaS are similar, there is a difference in approach between MoD pilot programs in the U.S. and early MaaS schemes implemented in Europe. MoD is primarily a transportation management system that considers both passenger and goods move- ments. MoD relies on the bespoke design of public sector-led technology platforms and incentive programs—for example, the Tri-County Metropolitan Transportation District of Oregon’s OpenTrip Planner Shared-Use Mobility—or negotiation of one-to-one pilot partnerships between public transit providers and ICT-enabled mobility service providers—for example, the Los Angeles County and Puget Sound last-mile partnership with Via. MaaS schemes in Europe have focused on the creation of mobil- ity clearinghouses, which not only involve technology platforms that enable multi-way partnerships among mobility services (traditional and new) but also new business models and ways for users to subscribe to “bundles” of mobility options. 33 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Table 1. Characteristics of four European MaaS schemes UbiGo Smile Whim Helsinki Jelbi Location Gothenburg, Vienna, Austria Helsinki, Finland2 Berlin, Germany Sweden1 Duration November 2013 – November 2014 – May October 2016 September 2019 – ongoing April 2014 2015 (test app May 2014) – ongoing (soft launch June 2019) (soft launch August 2016) Integrated Public transit and Public transit and other Public transit (bus, Public transit (bus, tram, transportation other mobility ser- mobility services, includ- tram, ferry, metro and metro and commuter rail) alternatives vices, including taxi, ing taxi, car-share, and commuter train) and and other mobility services, car rental, car-share, bike-share. other mobility services, including taxi (coming soon), and bike-share. including taxi car rental, microtransit, bike-share, and and bike-share. electric scooter-share. Nature of the Research pilot Research pilot Commercial Commercial scheme MaaS provider Consortium (funded Consortium (funded by Private company Public transit operator (BVG) by the government) the government) (Whim) Payment Monthly mobility Pay-as-you-go Monthly mobility bun- Pay-as-you-go options3 bundles dles and pay-as-you-go Rollover credit Yes N/A No N/A Website https://www.ubigo. http://smile-ein- https://whimapp.com/ https://www.jelbi.de/en/ me/en/about-ubigo fachmobil.at/ home/ pilotbetrieb_en.html Notes: 1UbiGo has relaunched in Stockholm in early 2019. 2Whim also provides MaaS schemes in West Midlands, United Kingdom; Antwerp, Belgium; Vienna, Austria; and Turku, Finalnd. It expects to extend its offer in Greater Tokyo, Japan and Singapore. 3See Chapter 4. Technology for more details on MaaS payment options. Source: UbiGo (Socher, Karlsson and Strömberg, 2016; 2015a; 2015b); Whim (Hartikainen et al 2019; Huhtala-Jenks, 2019). Supply-side challenges and lack of government provider is a public agency. Lack of ubiquitous smart- capacity help explain the slower arrival of pub- phone penetration and internet connectivity present lic-sector-led MaaS to emerging economies. In another key supply-side challenge in emerging developing cities, “informal” transit services play economies. Box 2 outlines how Kochi One, one of the an important role in mobilizing large numbers of first documented MaaS-like schemes in an emerging people. Integrating these services in MaaS schemes economy, addressed such challenges. is particularly challenging, especially if the MaaS 34 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Box 2. Addressing supply-side challenges to MaaS implementation in emerging economies: Kochi One in India Kochi One is a MaaS scheme implemented in 2017 in the city of Kochi in the Indian state of Kerala. Kochi was the first Indian city to implement multimodal integration, with goals of reducing private motorization and expanding public transit in a more cost-efficient manner. Kochi One integrates tradi- tional public transit with other mobility services, including informal transit services. And, while it relies primarily on a smartphone app as user interface, it provides a smartcard alternative for individuals without smartphone-based Internet connectivity. Kochi One continues to operate and is even expand- ing to provide additional support to women and students during the Covid-19 pandemic. Integration of informal transit services in the MaaS scheme: In its development phase, Kochi One strategists collaborated with several key stakeholders, including informal transit providers. This stake- holder engagement has enabled Kochi One to integrate auto rickshaw services and private bus oper- ators together with formal public transit services and the public bike-share system. To integrate these providers, the MaaS scheme required the establishment of a co-operative society for auto rickshaw drivers, and the registration of individual bus operators as Limited Liability Partnerships (LLP) and private societies. The strategy incorporated rickshaws and private buses as a new layer in the system dedicated to providing feeder services to formal public transit. These rearrangements helped increase multimodal integration and provided improvements in fleet management and route distribution. Provision of alternatives to the smartphone app user interface: Kochi One offers a smartcard user interface in addition to the smartphone app user interface. The smartcard option provides users who don’t have smartphones or mobile internet connection with an alternative payment option to use all the services within the MaaS scheme, including private buses and auto rickshaws. Furthermore, the interfaces work together, with the smartphone app also serving as an electronic valet integrated to the Kochi One card. Source: Singh (2020). In many developing cities, the private sector has super apps started out as ridesourcing or other led innovation and integration, creating “super mobility service start-ups before expanding into all- apps” that create a common payment system in-one aggregated digital shops. Now the technology that covers multiple functions of everyday life, giants are innovating in contactless payments and including mobility. Asia, in particular, has witnessed improving accessibility to various digital services the proliferation of these super apps, with major worldwide. The trend is also become global, with players including WeChat in China, Grab and Gojek additional players such as Careem emerging in the in Southeast Asia, and Paytm in India. Many of these Middle East and Rappi in Latin America (Pelikh, 2020). 35 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH With most of these super apps having their roots providers from becoming too dominant (Smith, in mobility services, the emergence of super apps Socher and Karlsson, 2018). may present a bright future for MaaS. However, with the initiative from the private sector, these The MaaS party responsible for the interface role, apps have been slow to integrate public transit however, is unlikely to accept a separate MaaS inte- services onto their platforms4 and are motivated by grator unless this delivers a clear added value to the expanding consumer demand and profit rather than MaaS chain that could not be offered by the MaaS societal goals of inclusion and environmental action. interface itself (Smith, Socher and Karlsson, 2020). Governments in developing cities can harness this In this document, both roles are considered unified progress and govern how these technologies con- unless otherwise explicitly stated. tinue to develop to ensure that the mobility services that they offer are well integrated with public transit, To be successful, MaaS providers need to over- supported by active mobility, and accessible to all. come five main challenges (Keupp et al., 2019): i. Reconcile conflicting stakeholder needs within a complex and constantly evolving MaaS ecosys- 2.2 The MaaS provider tem. For example, while government agencies are looking to provide safe, equitable, and sus- The Maas provider is a new intermediate layer tainable transportation throughout the city and between users (the demand side) and mobility often operate traditional public transit services, providers (the supply side) (see Figure 2). MaaS private sector innovators might disrupt the providers have two main roles: traditional setup and exploit inefficiencies. MaaS providers need to find ways to resolve these i. MaaS providers have an integrator role among conflicts. mobility service providers, creating an open plat- form that does not limit participation of multiple ii. Integrate different pricing and business models mobility service providers.5 from different mobility providers, into user- friendly and transparent ways to pay. Fares can ii. MaaS providers serve an interface role for cus- be distanced based, time sensitive, demand tomers, providing a single platform for users to driven, etc. Targeted subsidies or other programs access trip information, booking, and payment. that address affordability for lower-income users These two roles can also be provided by two should also be considered from the outset. different parties, which could help prevent MaaS 4 Rappi has started to offer digital ticketing for public transit in Bogota, Colombia and Paytm supports toll gate payments in India (Pelikh, 2020). Brazilian smart mobility startup Quicko began by providing real-time information and suggested routes across public and private transport modes, including bus, train, taxi, ridesourcing, and bike-sharing; however, new investments from the rail operator of lines 8 and 9 of Companhia Paulista de Trens Metropolitanos (CPTM) in Sao Paulo could bring with it greater integration of public transit modes and payment features (LABS News, 2021). 5 In practice, avoiding the creation of “walled gardens” or platforms that limit or bias access to certain modes or providers has proved a notable challenge in MaaS implementation (Hensher et al. 2020). Therefore, the integrator role for any MaaS provider must be carefully considered and enabled and the public sector may play a critical role in ensuring fair access to the platform for all providers. 36 MOBILITY AND TRANSPORT CONNECTIVITY SERIES iii. Reconcile different IT systems and data formats MaaS providers have a privileged position in the into a single and reliable data feed about the MaaS ecosystem through their direct link to the various modes to users. The challenges lie in user. This grants them the ability to that there are legacy systems and formats that have been developed by traditional operators i. become the main brand users relate to and feel and government agencies, while ICT-enabled loyalty for; mobility service providers may use very different approaches. ii. have comprehensive insights into users’ prefer- ences, needs and willingness to pay for different iv. Customize and scale the products and services modes and services (MaaS providers are likely to they offer, tailoring to local needs and adapting have access to data generated by both users and to existing transport systems and regulations. by the mobility services they integrate), and v. Monetize the business model, through fares and iii. influence demand through pricing and other other revenue streams, so that all participating product design strategies (see Chapter 3. mobility providers and the MaaS provider itself Demand). can cover costs and meet profit targets in a sus- tainable manner (see Chapter 5. Business). Figure 2. Illustrative example of direct links between mobility system stakeholders: With and without MaaS With MaaS scheme Without MaaS scheme Users Users MaaS provider (Interface role) (Integrator role) Mobility providers Mobility providers 37 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Mobility providers, understandably, may be reluctant traditional mobility services, focusing on the role that to give up the direct link to the user, and the related these traditional modes can have in MaaS and on benefits that MaaS providers get from it (see Figure what changes may be needed to make them “MaaS- 2). Therefore, the value proposition offered by the ready.” And third, it outlines the role of each of the MaaS provider needs to overcome the tensions with mentioned mobility services in MaaS. mobility providers that may discourage them from participating in MaaS schemes (Merkert, Bushell and 2.3.1 ICT-enabled mobility services Beck, 2020). ICT-enabled mobility services can be categorized as ‘to ride’ or ‘to rent’ services (see Figure 3). ‘To ride’ services are services that include a vehicle and 2.3 Mobility service providers driver, such as ridesourcing or microtransit. ‘To rent’ services do not include a driver, so operating the MaaS integrates traditional transportation vehicle is the user’s responsibility. Examples of ‘to modes with a range of ICT-enabled mobility rent’ services include car-, bike-, and scooter-sharing. services. This section provides an overview of Both types are typically enabled by digital technolo- existing mobility options with the aim to better gies, which differentiates them from their traditional understand the different pieces of the supply side of counterparts. MaaS. The section is divided into three parts. First, it outlines ICT-enabled mobility services, presenting ‘To ride’ mobility services offer a driver with implementation examples in emerging economies, the vehicle. These services are commonly offered highlighting positive and negative impacts of these by ridesourcing companies—like Uber, Didi, or services, and discussing policy measures that can Grab—that leverage the vehicles owned by indepen- address externalities. Second, this section outlines dent drivers. Vehicle types can span from two- and Figure 3. Categorization of ICT-enabled mobility services as ‘to rent’ or ‘to ride’ services 'To ride' mobility services 'To rent' mobility services Ridehailing Bike-sharing (car-based or motorcycle) Microtransit Car-sharing Scooter-sharing (kick scooter or moped) 38 MOBILITY AND TRANSPORT CONNECTIVITY SERIES three-wheelers to regular automobiles. When ‘To rent’ mobility services offer access to a vehicle vehicles are even larger, for example minibuses, ‘to (e.g., car, bike, or scooter) without a driver. Unlike ride’ services are often referred to as microtransit, traditional car rentals, ‘to rent’ mobility services are typically referring to technology-enabled shared usually aimed for short rentals for a specific trip, transportation services for medium-sized groups of often paid by the hour (or even by the minute). travelers and often operated using company-owned The discussion of ‘to rent’ mobility services in this vehicles. Another service in the ‘to ride’ category is section will focus on commercial fleet-based mobility carpooling, in which users get a ride from someone services; however, it is important to note that peer- already conducting a trip in a similar direction to to-peer (P2P) services have also helped to shape the theirs (Shaheen, Chan and Gaynor, 2016). shared mobility ecosystem (see Box 3). Box 3. Peer-to-peer ‘to rent’ mobility services Peer-to-peer or P2P mobility services refer to services that rent vehicles owned by private individuals. When the owners do not need their vehicles, they can make them available for rental to other individ- uals (e.g., P2P car-sharing) or, when in use, they can provide a ride to other individuals with a similar trajectory (e.g., carpooling). Several P2P car-sharing services are in operation in Southeast Asia—for example, Roadaz (since 2016) and Moovby in Malaysia—and carpooling services are popular in Africa. P2P mobility services can provide additional supply to the mobility system and often offer more affordable mobility solutions than similar commercial fleet-based ‘to rent’ alternatives. Additionally, P2P car-sharing enables a higher utilization rate of existing vehicles and carpooling enables higher occupancy of vehicles on the road. These aspects contribute to the mobility outcomes that MaaS strives for: improved access, affordability, and sustainability. However, the rent or ride depends on the owner’s needs, which can make their integration into the urban mobility ecosystem more difficult. CAR-BASED RIDESOURCING 50 countries. Other large players operating in emerg- Car-based ridesourcing services offer taxi-like ing economies include Didi in China and multiple services in privately-owned cars. The concept is countries in Latin America, Ola in India, Grab in mul- to match drivers willing to provide transportation tiple countries in Southeast Asia, and Bolt (formerly services in their cars with interested passengers via Taxify) in Africa, western Asia, and Latin America smartphone apps and a centralized platform. They (Curry, 2021). may also offer pooling options, where passengers from different parties share rides by the same driver. Car-based ridesourcing companies may increase The most well-known company offering car-based the coverage of taxi-like services. Their business ridesourcing services is Uber, present in cities in over model—leveraging a new fleet of cars through a 39 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH digital platform—allow users to access their ser- proper vetting and training of drivers. To offer addi- vices in less populated areas or during hours of the tional safety to female users and drivers, female-only day when finding a taxi gets difficult (for example, ridesourcing services such as Riding Pink in Malaysia during peak hours when demand outstrips supply or or FemiTaxi and LadyDriver in Brazil have emerged during late nights when supply is low). Low-income and operate with varying degrees of success. neighborhoods with lower demand, where taxis are often in lower supply, may also enjoy better coverage Car-based ridesourcing services are also associ- (Brown, 2018). The business model also decreases ated with two main negative impacts: increases waiting time and waiting time uncertainty (because in vehicle miles traveled and lane blockages more cars are available, dispatching is based on GPS during pick-up and drop-off. location, and real-time location and time-of-arrival updates are available), which all improve quality of • A growing number of research studies indicate service experienced by users. that car-based ridesourcing leads to increases in vehicle miles traveled (VMT) (Ferhr & Peers, Car-based ridesourcing services may provide 2019; Erhardt et al., 2019; Henao and Marshall, an increase in personal safety and security for 2018; SFCTA, 2018; Schaller, 2018) which can add users compared to existing formal and informal to congestion (Agarwal, Mani and Telang, 2019). public transit or taxi services. Safety and security ‘Empty’ vehicle miles while drivers search for ride improvements may come as a result of the tools requests, induced trips due to ease of access and controls enabled by the digital platform. Policy and other service quality improvements, and and protocols around driver vetting are essential. modal shifts from public transit and active modes Once employed, drivers are held accountable for the account for these increases (see also Chapter 3. quality and safety of the service they provide. During Demand). While many policies have been used the ride request and wait periods of the service, the to try to address VMT and congestion-related user is able to see if there are available vehicles, how impacts of ridesourcing services (see, for example, long they will take to arrive, and what vehicle and Box 18), policies that mandate the achievement driver will pick them up. This information allows users of target outcomes (e.g., congestion reduction) to make a safer and more secure decision. During instead of dictating the means to achieve this the in-vehicle ride, the reporting of detailed data outcome (e.g., caps on ridesourcing vehicle recorded about the trip (including data on the drivers, licenses) have proven to be the most impactful their car, pick-up, route, and drop-off locations, and (see Chapter 6. Governance). Polices that promote even driver performance) are meant to act as deter- pooled ridesourcing trips can also mitigate some rents of any irregular behavior. User surveys suggest of these negative impacts, particularly in dense that customers view ridesourcing as safer than many urban areas. Simulation studies have shown that traditional mobility services, including formal and pooled ridesourcing can help reduce congestion informal transit and taxi services (e.g., Magaloni, (ITF, 2016) and only entail very limited travel time 2019). Still, there has been significant press about increases for their users (Tachet et al., 2017). They cases of violence perpetrated during ridesourcing also provide cheaper alternatives, making car- trips and audits and oversight is needed to ensure based ridesourcing services more affordable. 40 MOBILITY AND TRANSPORT CONNECTIVITY SERIES • Car-based ridesourcing can also cause lane Same as car-based ridesourcing, motorcycle blockages during pick-up and drop-off, lead- ridesourcing improves service coverage. This is ing to congestion and road safety incidents. primarily due to the use of smartphone apps and Allocating designated pick-up and drop-off points a central dispatch platform, whereas traditional (and banning pick-up and drop-offs in particularly motorcycle taxis just wait for passengers in strategic sensitive areas) can partly solve this problem. high-demand locations. Two benefits of motorcycle Such measures can also help reduce passenger ridesourcing compared to car-based ridesourcing disutility when pooling trips together and it can are cheaper fares and greater service flexibility. foster intermodal trips if designated points are Cheaper fares come as a result of lower fuel con- located near major public transit stops. sumption and lower vehicle purchase costs. The flexibility comes from their compact design, which MOTORCYCLE RIDESOURCING allows drivers to maneuver around congested roads Motorcycle ridesourcing offers taxi-like services (albeit with greater safety risk) or traverse roads that on private motorcycles, applying the same are poorly maintained. ridesourcing concept of matching drivers with passengers via a technology platform. Even before The main concern for motorcycle ridesourcing ICT technology enabled ridesourcing services, motor- is the added safety risk. As with all motorcycles, cycle taxis were (and continue to be) very popular in riders are exposed to a greater risk of injury or death emerging cities. They are known by different regional from traffic crashes. Motorcycle-only lanes can avoid names, such as motodops in Cambodia, ojeks in vulnerable motorcycles driving in between cars, Indonesia, or okadas in Nigeria. Motorcycle ridesourc- reducing their safety risks. Digital platforms can also ing services have become popular too, sometimes help monitor driver speeds and encourage drivers to resulting in conflict with established motorcycle taxi abide to the rules of the road. services (see Box 4). Examples of service providers that offer motorcycle ridesourcing include Gojek, Uber, and Grab. 41 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Box 4. Conflicts between motorcycle ridesourcing services and traditional motorcycle taxis in Bangkok, Thailand Motorcycle taxi services in Bangkok (known as ojek)—a popular form of informal public transit—were regulated by the Thai government in 2005. Following the regulations, ojek operators are organized in groups known as wins. Ojek drivers pay significant sums for their win memberships. Each win is assigned a territory and drivers are only allowed to pick up passengers within their win territory. However, this win structure has clashed with emerging motorcycle ridesourcing services in the city, which are not subject to the same regulations. One reason for conflict is that motorcycle ridesourcing services do not have to abide by the same territory restrictions regarding picking-up passengers. Second, motorcycle drivers who have already paid for their win membership are often reluctant to pay extra per-ride fees to a ridesourcing company. This is just one of many examples of urban mobility regulations that create imbalances between mobility providers. Official restructuring and integration of different mobility services via MaaS and its governance could help alleviate these conflicts. Source: Phun, Kato, and Chalermpong (2019). MICROTRANSIT Microtransit services combine traditional bus- Microtransit has significant potential to reduce based transport with ridesourcing technologies. congestion by pooling trips into larger, shared While the specific form of these services can vary, vehicles while maintaining greater flexibility they typically involve minibuses or vans providing than fixed-route public transit services; however, services akin to pooled ridesourcing within a more microtransit could also compete directly with restricted service area. With deployments in cities traditional forms of public transit. Microtransit can around the world, Via Transportation is one of be used as a direct substitute to public transit due the most prominent microtransit providers, often to the higher comfort and convenience they provide working in partnership with local governments or (Alonso-González et al., 2018). However, MaaS inte- operators. For example, CityBus 2.0 in Goiania, Brazil grated schemes and partnerships between micro- was implemented through a partnership between HP transit and public transit providers (already popular Transportes Colectivos and Via in 2019. In Asia, local in the United States) can help foster synergies and bus-sharing start-ups are also emerging to improve avoid direct competition between both services. the experience of bus-riders (see Box 5). For example, CityBus 2.0 has managed to take cars off the road, with 80% of its riders switching from private car, taxi, or non-pooled ridesourcing services (Echeverria, Berkovits and Fedorova, 2020). 42 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Box 5. Bus-sharing services: The example of Jatri in Bangladesh With the promise of reducing the number of vehicles on the road and overcoming the chronic short- age of state-run buses, bus-sharing services are rapidly gaining traction in fast-growing cities. By matching bus routes closely to commuters’ needs, technology-enabled bus services—such as Jatri in Bangladesh, Swvl in Cairo, and Airlift in Pakistan—are gaining popularity by offering reliable, afford- able, and efficient transport for millions of commuters. In Bangladesh, Jatri is at the forefront of introducing this service in Dhaka city, with benefits for both users and bus operators. With its innovative app and flexible features, Jatri is providing bus com- muters of Dhaka real-time updates of the bus location and estimated time of arrivals. The app also provides a digital payment system for buses; commuters are encouraged to purchase their bus tickets through the app, allowing cashless and quick transactions. Apart from digital ticketing, Jatri supports offline ticketing too. Commuters without smartphones can opt for point of sale (POS) machine ticket- ing at bus counters. The Jatri app also provides a multitude of features for bus operating companies, such as fleet management, accurate data analytics, transparency of payments and cash flows, and more. As the payment system is completed digitally, all transactions are handled by banks, making the activities of bus owners much easier and manageable. Source: Arman (2020). CAR-SHARING There are two types of car-sharing services: Car-sharing services are similar to traditional car roundtrip and one-way. Research from the USA rentals services, but are aimed at shorter rental and Europe indicates that roundtrip car-sharing durations (less than a day). Car-sharing services brings more positive mobility impacts than one-way have started operations in several emerging econ- car-sharing. Compared to one-way car-sharing, omies. By October 2018, car-sharing was operating roundtrip car-sharing (i) contributes to a greater in 47 countries and six continents, with the largest reduction of car ownership and vehicle miles car-sharing region measured by membership (71.4% travelled, (ii) complements public transit more, (iii) of global market) and fleet deployed (54.4% of global is more often used to carry goods, and (iv) tends market) being Asia. The world’s next largest car-shar- to have higher occupancy rates (Becker, Ciari and ing markets are Europe and North America (Shaheen Axhausen, 2017; Le Vine et al., 2014). and Cohen, 2020b). Some notable examples of car-sharing services in developing cities include The main potential benefit of car-sharing services GoCar and Socar, operating in several Malaysian is that they provide an alternative to owning cities, Carrot in Mexico City, and Volkswagen’s Move and maintaining a car. For trips where using a car in Kigali, Rwanda. makes the most sense (e.g., buying bulky groceries or traveling at a time or to a location where public transit is not readily available), car-sharing services are a viable alternative to needing to buy a car. 43 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Car-sharing can be a useful tool in emerging econ- • Free-floating: The introduction of dockless omies, where car ownership rates are still low but bike-share helped fuel additional proliferation growing fast, to prevent a wholesale transformation of bike-sharing services, with the number of of their transportation systems towards car-depen- public-use bicycles worldwide rising from approx- dence. China has also introduced policies to foster imately 700,000 in 2013 to close to 2,300,000 in car-sharing services with the aim to reduce car own- 2016 (Meddin, 2018). Vehicles in dockless systems ership in major cities. Car-sharing services not only can be parked anywhere, as long as the vehicle provide an alternative to owning a car for individuals is within a predetermined service area. The main who can afford one, but also decrease the barrier to advantage of dockless schemes is the additional accessing a car for those who cannot afford to buy flexibility of origins and destinations (regardless one. However, in practice, there is little evidence of of trip purpose) that they grant to the user. reduced or foregone car ownership due to the pro- Dockless bike-share is more reliant on smart- vision of car-sharing except in areas that introduce phone apps. Three Asian companies dominated the services along with other measures designed at the rapid expansion that these services had all discouraging private car ownership and use, such as over the world between 2015 and 2018: Mobike, parking policies (Stolyarov, 2018). Ofo and oBike.6 BIKE-SHARING Bike-sharing can be found in a myriad of mid- Bike-sharing services are short-term bicycle dle-sized and large cities in Asia and Latin America. rental schemes that come in two types: sta- African bike-sharing implementations are, however, tion-based (‘docked’) and free-floating (‘dockless’). relatively limited.7 • Station-based: The concept of docked bike-share Bike-sharing has many benefits; it provides systems has existed for decades, with prominent flexible and environmentally friendly transpor- cities in Western Europe and North America tation at low costs. Users that enjoy biking do not implementing them between 2005 and 2010. need to deal with the hassle of taking their own bike Vehicles in docked systems need to be parked everywhere and having to lock it; similarly, they can at designated stations. The main advantage of have easy access to a bike at times when they did not these schemes is that having specified stations bring their own. It is environmentally friendly, afford- ease operational logistics (e.g., relocation, fueling able, and it promotes health for users. Governments or battery charging/swapping, or maintenance). interested in fostering cycling should invest in provid- Additionally, stations increase vehicle safety ing a safe cycling environment and endorse a cycling (stations can be video surveilled) and simplify culture. The limited development of bike-sharing in customer access via smartcards (reducing barriers Africa can be partly explained by the lack of cycling for individuals without smartphones or internet infrastructure on the continent and general negative connectivity). attitude towards cycling (which is often perceived as a transportation mode exclusively for the poor). 6 Mobike still operates today but Ofo and oBike do not. 7 The UN has supported bike-sharing developments in Marrakech (Morocco), Nairobi (Kenya) and Cairo (Egypt). 44 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Bike-sharing has brought concerns regarding with disabilities. Regulations were introduced in safety, urban clutter, and vehicle recycling. The many cities to try to avoid such waste,8 but more low investment costs necessary to supply a fleet of recently, Uber disposed of a large number of usable bicycles triggered the introduction of a large number bicycles during the Covid-19 pandemic (Hawkins, of redundant bicycles by competing operators in 2020). Regulations could further incentivize the dona- several cities around the world. These bicycles were tion or re-use of bicycles from bike-sharing schemes subsequently poorly maintained and subjected to to increase the lifecycle of such transportation vandalism, resulting in large numbers of unusable resources. Additionally, poor biking behavior and bicycles that were collected in so-called “bike-sharing parking on sidewalks also contributes to the negative cemeteries” and occupied space on sidewalks that impact of bike-sharing. became a safety hazard for pedestrians and people 8 The International Association of Public Transport (UITP) and the European Cyclists’ Federation (ECF) also developed a position paper to help cities regulate free-floating bike-sharing schemes (2017). 45 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Box 6. How fair is the allocation of ’to rent’ infrastructure? Example of a bike-sharing system. Distribution of ‘to rent’ infrastructure can strongly influence how and by whom these services are used. Distribution strategies should be incorporated into permits and regulations for bike share oper- ators; otherwise, if driven-only by private profit, operators may disregard key areas where bike share could be of great impact. These considerations apply to any context, but may be most important in emerging economies, where inequalities among different urban areas are high. Figure B3.1 depicts different strategies for the spatial distribution of bike-sharing stations, which can be the locations of docks or, in the case of dockless systems, locations where bikes are positioned by the operator. • Strategy 1 allocates a larger number of stations in underprivileged areas, improving accessibility especially among the more vulnerable; • Strategy 2 distributes stations evenly across the whole area, fostering more equal access to bike-sharing infrastructure; and • Strategy 3 introduces a larger amount of stations in areas where profit is expected to be highest and vandalism lowest, but improving accessibility primarily among those who are more privileged.9 These strategies can be merged in different ways to try to deliver on equity, equality and efficiency at the same time. Figure B3.1. Different strategies to plan the introduction of bike-sharing stations. 1. Equity 2. Equality 3. E ciency Underprivileged area Bike-share station (lower demand) Privileged area Service area (higher demand) Source: Adapted from Duran-Rodas et al. (2020) Note that the availability of bicycles at any given station will also be impacted by customer relocation through use (following travel demand patterns in each city). This may influence the quality of the service that is provided in different areas, unless providers have protocols for bicycle redistribution that incorporate temporal elements, such as a minimum number of bicycles available at any station or a maximum time the station is allowed to have no bicycles. Policies can incentivize different strategies depending on their specific local mobility goals. In areas with MaaS schemes, allocation strategies are best developed from an integrated mobility standpoint. 9 Note that this approach could potentially increase bike-sharing popularity among the more privileged, which could, in turn, help reduce their car trips, and potentially help increase bike-sharing popularity among the less privileged through increased exposure. 46 MOBILITY AND TRANSPORT CONNECTIVITY SERIES SCOOTER-SHARING Box 7. Rwanda as a leader in electric and shared ‘to rent’ The term scooter-sharing can refer to services mobility services in Africa that provide short-term, trip-by-trip rentals of kick scooters or of moped-style scooters. Electric Rwanda is trying to establish itself as a kick scooters (or e-scooters) are the newest arrival to leader in green and shared ‘to rent’ mobility the shared mobility ecosystem and are experiencing services on the African continent, with aims a steep uptake. Examples of these services operating to reduce the use of fossil fuels while provid- in Latin-America are Grow, Jump,10 and Lime. Two ing clean energy for electrified mobility alter- large services in Asia are GrabWheels and Neuron. natives. Their policies have triggered a local On the African continent, Gura has introduced elec- start-up called Gura, which now operates in tric scooter-sharing services in Rwanda (see Box 7 Kigali, Musanze, and Rubavu. to the right) and other companies have announced plans to introduce services elsewhere (Dickey, 2019). Gura offers bike-sharing and scooter-shar- ing services in which vehicle trips are Shared kick e-scooters provide significant user accessed and paid for via smartphones or convenience, but lack of regulatory frameworks smartcards (for those without smartphones). around their implementation have raised con- Gura began with conventional, pedal-pow- cerns about safety and urban clutter. Scooters ered, gear-assist bicycles, but has since are compact and convenient, fun and easy to use, expanded its fleet to include shared e-bikes typically require less physical effort than bicycles, and and e-scooters. To power their e-bikes and are often cheaper than ‘to rent’ services with larger e-scooters, Gura installed solar-powered vehicles (Santacreu et al., 2020). While popular, these charging and parking docks. services have also been criticized for the haphazard way in which users park (sometimes blocking side- The company’s mission is to provide walks), or ride (creating traffic incidents with vehicles affordable transportation, reduce carbon and pedestrians). Introduction of these services is so emissions, improve air quality, and ease recent that there is a lack of regulatory frameworks congestion in Rwandan cities. But they also regarding their use; maximum speed limits, enforce- embrace their role in fostering local and ment of helmet laws, mandatory use of bicycle inclusive economic development. In order to infrastructure rather than sidewalks, and allocation create jobs, bicycles are assembled locally. of dedicated parking can help avoid potential future And the company aims for a 25-30 percent safety problems. share of female staff. The popularity of shared moped-style scooter services is still limited but increasing. Moped- Sources: Ashimwe (2019); https://www.guraride.com/ style scooter-sharing is especially popular in India (Bounce) and Brazil (RibaShare). 10 Jump was the e-bike and e-scooter service of Uber until early 2020, when it was acquired by Lime (Dillet, 2020). 47 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH 2.3.2 Traditional mobility modes access for all. Dense and frequent public transit services provide the backbone for a successful MaaS Traditional mobility options—including formal scheme, and in doing so allow ICT-enabled mobility and informal public transit, taxis, and walking services to focus on critical areas or populations and cycling—serve the vast majority of trips that need more flexbile mobility options. A digital in developing cities, with some exceptions of interface—which provides trip planning, real-time increasing private car use. They will also play an vehicle location information, and enables fare important role in MaaS and the multimodal lifestyles payment—makes public transit more attractive to MaaS encourages. Walking and cycling will make users, particularly those that are not familiar with the up shorter distance trips, while formal and informal system. In Jakarta, the introduction of Trafi, a real- public transit can serve longer-distance trips along time multimodal app, led to significant decreases in key corridors. When ICT-enabled mobility services are car use and a 20% increase in bus transportation use integrated with public transit and other traditional (Better Together Award 2020). Moreover, high quality mobility modes, they can help expand first-/last-mile digitalized performance and demand data is a tool access and provide coverage in traditionally under- for public transit providers to identify disruptions and served areas. However, upgrades to service quality to make changes in their offered services. and the infrastructure are required to match the tech- nological and user-centric nature of MaaS. MaaS aims to provide public transit users with a broader range and a more diverse set of mobil- PUBLIC TRANSIT ity alternatives that complement its offer and Previous research indicates that dense, frequent, enable well-integrated door-to-door trips. If imple- and reliable public transit services are key for mented carefully, this could have two advantages for MaaS implementations in dense urban areas (Li public transit providers: and Voege, 2017; UITP, 2016). This is due to public transit’s inherent ability to move large numbers • It may enable more cost-efficient public of people (which contributes towards green and spending. MaaS may enable public transit agen- efficient mobility) and its underlying government cies to focus their resources on high-demand support (which enables advancing equitable and corridors where fixed-route, high-capacity public affordable mobility). transit is most. This would allow smaller, more flexible, and less costly alternatives to provide Public transit needs to provide good quality of additional coverage and more catered services service and a digital interface for trip planning, to customers in lower demand areas or for first-/ vehicle information, and fare payment to ensure last-mile connections. However, pilot partnerships its success and its role as the backbone of MaaS. between public transit agencies and private Providing good quality of service ensures that public mobility providers have had mixed results, transit modes are safe and reliable and expand depending on the subsidies. 48 MOBILITY AND TRANSPORT CONNECTIVITY SERIES • It helps increase and balance use of different onboard is one of the greatest opportunities for modes, such as public transit and active implementation of MaaS in developing cities; yet mobility. Real-time information and multimodal informality is one of the main challenges for advanc- mobility integration incentivize users to perform ing towards integrated transport systems like MaaS. multimodal trips. Organizational and regulatory changes are INFORMAL TRANSIT SERVICES needed to consolidate fragmented operators and Informal transit services—such as those provided for informal transit to become part of a MaaS by minibus, 2-wheel and 3-wheel taxis—are the scheme. The majority of informal transit services are primary modes of transportation in many devel- provided by fragmented operators, ranging from oping cities and have traditionally filled import- small companies to individuals. Encouraging a single, ant accessibility gaps in cities with and without ICT-enabled mobility service or public transit agency more formal public transit services. As a result of to join a MaaS platform may be straight-forward. their popularity and high market share, these services However, figuring out how to integrate informal tran- should be at the heart of any local MaaS scheme sit providers—a large group of single-vehicle or small- that seeks to achieve door-to-door, sustainable and fleet operations—presents additional challenges. Any equitable mobility. While informal transit services significant improvement of informal transit services— have often operated outside of public planning and including their integration into a MaaS scheme—will regulatory environments, they must be formally require changing the business model to enable collec- recognized as a valuable alternative in the mobility tive management of fleets to serve customer needs ecosystem in order to successfully bring them into a (see Box 8; Kumar, Zimmerman and Arroyo-Arroyo, MaaS scheme. While policy over the past decade has 2021). In other words, this involves the investment of focused on replacing these services with more formal time and resources towards stakeholder engagement public transit options, experience has made it clear that addresses existing balances of power and incen- that we need to embrace, engage, innovate, improve, tive structures between drivers, owners, and passen- integrate, and invest in these services so that they can gers. Kochi One in India provides one example of how participate in new, open technology platforms and stakeholder engagement from early conceptualization support the MaaS vision of expanding green, safe, can help to integrate informal transit services formally efficient, and multimodal mobility for all (Tun et al., into a MaaS scheme (see Box 2). 2020). Therefore, bringing informal transit providers 49 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Box 8. Challenges in the “formalization” of informal transit operators and opportunities for MaaS: The case of Mexico City Mexico City has a complex public transit network that includes the full spectrum of formal, semi-for- mal, and informal services operating a variety of modes and vehicles, including vans, buses, BRTs, trolley, light rail, metro, and suburban rail. Most of the trips made by public transit (approximately 65%) are served by semi-formal bus services, typically operated by single permit holders that compete for riders. With more than 1,500 routes, these semi-formal services operate with over 15,000 medi- um-capacity vehicles. Since the introduction of the BRT system in 2005, the government has advanced organizational and regulatory modifications to support the transition from highly fragmented, semi-formal or informal operations to more organized and professionalized operations. Through the creation of Special Purpose Vehicles or commercial corporations, the transition to more professional organizations has allowed operators to access commercial financing for the acquisition of buses: either in the form of project finance (BRTs) or corporate financing (conventional bus corridors). Since then, over 4,000 vehicles have been replaced by cleaner bus technologies, serving seven BRT lines and over 20 bus corridors. The corporatization of the semi-informal services has also opened new opportunities for the govern- ment to support operators in the introduction of measures that favor system integration and conve- nience to users. Since 2019, the government supported the introduction of a multimodal electronic fare card system for payment on formal transit services, including BRT, metro, light-rail, and trolley operations. There are plans to widely introduce the electronic fare card to semi-formal bus opera- tions, starting with 20 bus services operating under commercial corporation schemes. The restructuring process in Mexico has been long and complex—because of the scale and frag- mentation of semi-formal and informal operations and the city’s dependence on these mobility services—and has not yet been completed. Moving forward, Mexico City faces a big challenge to fully incorporate these services into the integrated network and upgrade service quality. In this sense, MaaS can be an organizational framework to support the integration of services that do not necessar- ily require full formalization or corporatization, as this formalization often increases the cost of service. 50 MOBILITY AND TRANSPORT CONNECTIVITY SERIES MaaS can provide informal transit providers security, comfort and value for money (Zulkifli two main benefits: streamlined operations and and Yunus, 2019). A digital interface can increase increased demand. Integration in MaaS can provide accessibility by offering better coverage and quicker vehicle owners with a series of tangible and intan- service and it can address some security concerns gible benefits. In pilot projects in South Africa, for by providing real-time tracking of the trip. It can example, the consolidation of informal transit pro- increases comfort by enabling a review-based system viders into a few operator collectives helped improve that encourages drivers to provide a better service rates on vehicle maintenance and fuel, reduced the and by simplifying and improving transparency of the required fleet, reduced frictions between operators payment system, which does not require haggling, it and drivers by reducing the need for long shifts and is not subject to meter scams, and it allows for on-line standardizing notoriously exploitative reimburse- payment; and it provides a better value for money ment schemes, and improved safety by reducing thanks to the related gains in efficiency. For example, direct competition for passenger pick-ups and drop- gains in efficiency for app-based services are esti- offs on the roads. It can also help owners build equity mated to enable fare savings of around 20-40% of the and partnerships with government and ancillary taxi fare in the city of Santiago de Chile (Bennett and businesses. The MaaS digital platform for informa- Zahler, 2018). tion provision and payment can also help entice and retain ridership as urban mobility systems diversify There is still a long way to go to achieve inte- and grow. Additionally, integration of informal transit grated fare payments or service operations in services in MaaS can help in the dissolution of ter- a sector where most transactions still happen ritorial conflicts and structures and consolidate all in cash and the degree of coordination is very service providers under one platform. Integration in limited. While operators recognize the security MaaS can also help informal transit services compete and safety risks associated with their cash oper- in equal conditions with ridesourcing and other ‘to ation, challenges such as the upfront cost of new ride’ mobility services, increasing demand. If no fare collection equipment and the perception of integration is achieved, demand for informal services greater oversight, taxation, and loss of control over is difficult to forecast and thus service is difficult to revenues are all critical challenges to overcome in plan ahead, which in turn brings uncertainty and implementing electronic fare collection. Each inde- potentially increases operating costs for providers of pendent operator might lack the financial capacity informal transit. to upgrade to a digital interface on its own (Tun et al., 2020). However, collectively defining standards, In particular, the presence of a digital interface encouraging, and maybe even subsidizing collective can help improve how users perceive informal purchasing of necessary equipment among groups transit services compared to new ‘to ride’ shared of operators, can help overcome financial barriers mobility services with respect to accessibility, and ensure a seamless experience for users across providers (see Box 13). 51 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH ACTIVE MODES: WALKING AND CYCLING scooter-sharing services bringing some active trips Active modes are often forgotten in MaaS discus- onto technology platforms, MaaS providers will sions, yet they can be the most efficient, healthy, want to analyze how low-tech, active travel provides affordable, and environmentally friendly mobility important access to vehicles and services on their options for short trips. Walking and cycling cur- digital platform. To unleash the potential of active rently account for a significant share of trips in devel- modes in MaaS schemes, adequate and safe walking oping cities and, therefore, they need to be leveraged and cycling infrastructure and ancillary services strategically in MaaS planning and implementation. outside of the digital space are required. Wide, One of the difficulties in planning for active modes in well-maintained, and illuminated sidewalks, bicycle MaaS schemes is that many of these trips are made lanes, and bicycle parking facilities can further foster outside the digital ecosystem. Even with bike- and walking and cycling. 52 MOBILITY AND TRANSPORT CONNECTIVITY SERIES 2.3.3 The role of each transportation option in MaaS The integration of as many available transpor- Ideally, formal and informal public transit and tation modes as possible through MaaS offers a active modes would be the backbone of MaaS. range of mobility services that can fit the needs These modes are best aligned with the sustainable of different trips and different individuals. Since mobility outcomes that MaaS strives for. ‘To ride’ all modes, traditional or ICT-enabled, have distinct and ‘to rent’ services are best suited as first/last mile advantages and disadvantages (see Table 2), their solutions or to serve trips for which neither public integration is what enables synergies in urban mobil- transit nor active modes can provide a suitable ity. MaaS is a framework that can be used to facilitate alternative. Collective on-demand options, such as this integration, create innovative services where microtransit, can also be considered to substitute needed, and help channel resources in the most opti- traditional public transit routes with low/medium mal ways at a system-level. demand. The role different alternatives play in MaaS will influence the extent to which the societal out- comes of MaaS are achieved. Table 2. Overall and by-criteria social utility ratings of different modes and services. Criteria Private vehicle Car-share Exclusive Pooled Private Microtransit Bike- and Public (single- ridesourcing ridesourcing shuttles scooter-share transit occupancy) and taxi (ridesplitting) Space use when in motion/congestion 1 2 3 4 6 5 7 8 Vehicle miles traveled 1 3 3 4 7 7 9 9 Cost to user 1 3 4 7 9 7 9 8 Curbspace 1 6 7 7 6 6 6 6 Carfree lifestyle 1 7 7 7 7 7 6 8 Health/active lifestyle 1 7 1 1 5 5 10 7 related to use of service Accessibility 5 5 5 5 5 5 5 10 Equity 2 5 4 5 5 5 6 8 GHG emissions 1 3 3 4 7 7 10 9 Social utility rating Low Medium Low Medium Medium Medium High High Suburban applicability Yes Limited Yes No Limited No Limited Yes Notes: Each mode is ranked on a scale of 1 to 10 based on a set of criteria. Scores of 1 to 4 represent little to no benefit to society, 5 represents a neutral social utility, and 6 to 10 represent a positive effect on social utility. 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Demand 58 MOBILITY AND TRANSPORT CONNECTIVITY SERIES KEY TAKE-AWAYS FROM THE DEMAND PERSPECTIVE • Traveling around urban centers in emerging countries is fraught with barriers. Travelers in developing cities often face an unsafe, insecure, time-consuming, unreliable, crowded, expensive and inac- cessible ride. All these elements affect an individual’s ability to access opportunities such as employment and education. Transport is a criti- cal barrier to stepping out of poverty. • MaaS has a key role to play in developing countries—delivering improved mobility for target demographics, and helping to meet adopted climate and air quality goals. To offer successful custom- er-centric services, MaaS schemes need to respond to current travel patterns, land use patterns, and affordability constraints of develop- ing cities. • MaaS can help change urban mobility from an ownership par- adigm towards a services paradigm. MaaS may influence travel choices by reducing information asymmetry, prompting changes to operational and attitudinal attributes of a trip, and offering alterna- tives to car ownership. In fact, in developing cities, there may be an even greater opportunity for MaaS to help avoid motorization com- pared to in high-income cities with more established car ownership. The ability that MaaS has to nudge behavior away from private car ownership and use is dependent on recognizing and meeting unique user needs and supporting service-based approaches through com- plementary investment in infrastructure and implementation of rein- forcing policy measures (such as transport demand management). • Governments have a central role in shaping MaaS to align with societal goals and to use it to encourage sustainable lifestyles. Governments should partner with MaaS providers and actively lead initiatives to achieve meaningful results, coupling the behavioral nudging potential of MaaS schemes with green infrastructure investments. 59 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH • “Early adopters” of ICT-enabled mobility services are likely to be early adopters of MaaS. In developing countries, many of the features of these ICT-enabled mobility services appeal to higher-income groups; their location, price, and payment mechanisms favor those users. However, there are a few examples of services that target the poor and are particularly conscious about affordability. • There are not enough MaaS pilots focusing on lower-income groups, and governments should support initiatives that generate positive societal impacts. MaaS has a role in expanding the choice set of the poor by offering new or improved alternatives. This can expand access to employment opportunities, education, health care, and other services. • MaaS could have a prominent role in mitigating climate change and public health crises such as Covid-19 and supporting the “building back better” initiative. MaaS schemes and the ICT-enabled mobility services that are part of them can reduce emissions and improve air quality if the systemic impacts of transport are appropri- ately accounted. This means focusing on complementarity with formal and informal public transit services (serving the first-/last-mile) and sub- stitution of private vehicle ownership and use (replacing more polluting modes). MaaS may also support “building back better” in the wake of the Covid-19 pandemic by better matching user demand and service supply, supporting teleactivities that curtail the need for travel, and nudging users into green choices of transport, such as public transit and active modes with appropriate safety precautions. Governments should support initiatives that target these objectives. MAIN OPPORTUNITY/CHALLENGE FROM THE DEMAND PERSPECTIVE To bring a fundamental impact in the developing world, MaaS needs to expand its target customer base to include low-income users and incor- porate higher societal goals into its framework. Being user-centric means recognizing the needs of the poor in developing cities, including affordabil- ity, the need for geographical reach and the need to improve accessibility. By doing so and addressing the system effects of transport policies, MaaS can be more relevant in the developing world. 60 MOBILITY AND TRANSPORT CONNECTIVITY SERIES The experience of traveling around developing travel rates are lower than poor men, and they have cities is fraught with challenges, particularly for more limited access to household vehicles when they the poor. While urban transport systems in devel- exist. Persons with disabilities face yet an additional oping cities are varied, travelers that rely on public layer of challenges, and many tend to be immobile. modes face common experiences: rides are unsafe, Even in the rare case in which the existing transport insecure, time-consuming, unreliable, crowded, services offer the necessary accommodations, the expensive, and inaccessible. The poor in developing facilities they aim to reach do not. All these elements countries travel less, depend mostly on public transit affect an individual’s ability to access opportunities, and active mobility, have low access to personal find a better job, reach a hospital, or access better vehicles, and spend higher shares of their time and education. In short, transport is a clear barrier to income on travel. In low-income countries, most peo- stepping out of poverty. ple depend on walking or low-quality informal public transit to access jobs and other opportunities. In mid- Urban planning with a focus on the poorest (the dle income countries, the poor might have access to bottom 40%) is synergic with achieving climate more formalized public transit services or individual objectives in the transport sector, and MaaS can vehicles (bicycles, motorcycles or cars), but they still help strengthen both of these agendas. Because face many of the same challenges. The challenges of low ownership and use of individual motorized are so severe for women, the poor, and people with vehicles, greater reliance on public transit and disabilities, that some avoid traveling all together active modes, and low trip rates, travel patterns even if this means losing access to a better job or in lower income countries can be quite green other opportunity (e.g., Dominguez Gonzalez et al., already.11 However, lack of land use management 2020). Poor women are particularly affected; their and inadequate public transport infrastructure and 11 Green travel choices are here defined as travel that does not generate high levels of greenhouse gas emissions or air pollution, on a per capita basis. In general, private vehicles and trucks tend to be the biggest polluters in developing cities; however, in some cases, old fuel-inefficient buses can also be quite polluting. 61 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH service in many of these cities mean that economic “Early adopters” of MaaS generally fit a common growth may lead to higher individual motorization profile. In developed countries, users of MaaS and pollution. Instead, reducing motorized private schemes are also generally early adopters of ICT- vehicle ownership and use, improving access to enabled mobility services, such as bike-sharing public transit, better integrating with feeder systems, and car-sharing, and have an above-average use of introducing incentives to green traveling, and pricing public transit (Ziljestra et al., 2020). The typical user negative externalities can all support urban trans- is often young, male, does not (yet) own a car (but port systems that expand access and are affordable can often afford one), is educated, and tends to be and low emissions. MaaS can help on delivering interested in technological innovations (Lane et al., these objectives. 2015; Xu et al., 2019). Potential users of MaaS in developing countries 3.1 Potential users of MaaS may follow a similar profile. Given the low penetra- tion of MaaS in developing cities, the user patterns in developing cities of ICT-enabled mobility services in these contexts may provide clues about MaaS users. Some relevant considerations include: Research studies from developed countries sug- gest that up to 50% of individuals are willing to • Car-sharing adoption in emerging economies is adopt MaaS schemes that offer significant inte- low when compared to other modes of transport gration across mobility services (Alonso-González (Lane et al., 2015) and while users of ridesourcing et al., 2020; Ho et al., 2018; Liljamo et al., 2020). MaaS services may come from a variety of income seg- schemes are a fast changing but still nascent busi- ments, higher frequency of use is correlated with ness in mobility. Most studies of MaaS rely on stated higher incomes. preference surveys, so more pilots are needed to understand actual uptake. Based on these early stud- • Often, ridesourcing apps substitute taxi and car ies in developed countries, price is often considered trips but they can also substitute more sustain- the most important attribute, followed by current use able modes such as public transit or active modes; of shared or ICT-enabled mobility services and social experiences in Brazil, Chile, and India, show that influence (Caiati, Rasouli and Timmermans, 2020). ridesourcing services are used mostly for leisure These studies suggest, for example, that MaaS pro- trips (Tirachini, 2019), while use for commutes is viders should offer both ‘pay-as-you-go’ and mobility much less frequent (possibly because these ser- bundles,12 reducing the barriers to entry for those vices are not as affordable). who cannot afford the upfront cost of a monthly or weekly bundle. • Motorcycle ridesourcing use is also positively correlated with higher income and appeals to 12 Mobility Bundles are subscription-based mobility packages that offer a range of services to the potential traveller. 62 MOBILITY AND TRANSPORT CONNECTIVITY SERIES younger users; but in contrast to car ridesourc- There is a great untapped market for mobility ing, it is mainly used for commuting (Medeiros services and MaaS, but MaaS schemes need to be et al., 2018). In Jakarta, hailed motorcycles are cognizant of the needs of the poor, women, and regarded as a quicker way to get to work than the all users to be relevant and bring positive results alternative modes (Suatmadi, Cruetzig and Otto, for mobility systems in developing cities. Many 2019). In Colombo, Sri Lanka, ridesourcing by tuk of the existing ICT-enabled mobility services tend to tuk (3 wheelers) is widely used as an efficient and target higher-income groups, with some exceptions, relatively affordable way to get around the city. such as Vietnam, Iran, or China. But the concept, the approach, and the tools that MaaS offers are poten- • Bike-sharing schemes have been popular tially transformational if focusing on the needs and with male and higher-income groups in the aspirations of a range of customers. developing world (Ricci 2015). However, when priced right, bike-sharing can appeal more to lower income individuals, such as in Vietnam or Iran (Jahanshahi, van Wee and Kharazmi, 2019; 3.2 Mechanisms of MaaS Nguyen and Le, 2020). Users also span through all income levels; for instance, in China, the cycling MaaS intends to reframe mobility from an own- culture is strong among all sociodemographic ership paradigm to a customer service paradigm. groups (Li, 2019). The gender gap in bike use This means that individuals could access all types of may also be seen in bike-share use, since there vehicles as part of a MaaS scheme, without owning are stark differences between how much men them. There is evidence that current car-owners are and women cycle in many countries, and women less likely to use MaaS (Alonso-González et al., 2020), are not even allowed to ride a bicycle in some but the reverse—that users of MaaS will be less (Shaaban, 2020). However, some places, like likely to own a car—is what MaaS pledges to achieve. Mexico City, have seen strong growth in bike- In fact, MaaS users in Vienna do report reducing share use by females thanks to targeted cam- car use and increasing public transit use. They paigns like the “Women using EcoBici” program. also increased multimodality and chaining of trips, Bike-sharing users tend to be motivated by the motivated primarily by time gains. However, some sustainability impact of bike-sharing, its agility of the pilot MaaS schemes reported that individuals as a mode, and the role they can have as social used MaaS mostly to perform non-daily trips such influencers towards achieving more sustainable as leisure travel or running errands, suggesting that patterns (Cerutti et al., 2019). they are not yet using MaaS to meet their everyday travel needs.13 13 Daily routines will likely be more difficult to break, suggesting that MaaS has an important target audience to tackle: the potential customers who are forming travel habits, which can happen when one changes job, study or residential locations, increases the household size (marriage or children) or starts a professional career beyond school. These major life events offer an opportunity for MaaS to positively influence a reduction in vehicle ownership (Smile Mobility, 2015). 63 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH MaaS’s first mechanism to improve mobility is to their attitudes towards cars became more negative provide more comprehensive information about and their attitudes towards other modes (including travel options. Smartphone apps and other digital walking) became more positive. While actual travel interfaces aim to better inform mobility decisions, behavior, especially daily habits, has been shown to making customers aware of all their modal, route, be resistant to change (Kristal and Whillans, 2020; and fare options to complete any given trip. For Lieberoth, Holms Jensen and Bredahl, 2018), all the instance, users may not be completely aware that possible ways to influence behavior with information distances between two metro stations are often have not yet been explored. And MaaS provides a walkable, or that taking a metro gets you quicker to critical tool for resetting social norms and attitudes your destination than a taxi ride in certain contexts. around more sustainable travel choices. Accordingly, MaaS interfaces typically provide cus- tomers with tools to compare their options according MaaS leverages both monetary and non-mone- to travel time, cost, or preferred modes. The ultimate tary incentives to promote desired mobility out- aim is to reduce information asymmetries and comes. For instance, the integration of public transit empower the customer. That being said, the way fares across multiple routes and service providers is the information is presented in these interfaces also a well-established practice designed to lower transfer influences the choices users make. Simple elements costs and make transit more attractive. Public transit such as the order in which the alternatives are pre- providers (and government agencies) also give more sented, the default values (or preferences) set by the direct monetary incentives to users to get them to platform, or more advanced gamification strategies try new services or help advance certain policy objec- may create new sets of (intended or unintended) tives (see Box 9 and Box 10). In ICT-enabled mobility behavioral consequences. services, monetary incentives are also an entrenched business strategy. For example, ridesourcing com- MaaS may also aim to improve mobility by panies use monetary incentives, in part, to attract prompting changes in attitudes towards certain new users and flexible fare structures to manage travel choices. Personal attitudes and mobility customer demand. The value-added in MaaS is that, behaviors are interrelated. Changes in attitude may by integrating multiple modes into one single digital produce a change in behavior. For example, a person interface, customers can access all these monetary with a pro-green attitude who is offered information incentives across all modes. Moreover, the MaaS on the CO2 emissions from their trip may try to interface may also facilitate the development of new change their behavior and curb their CO2 impact next multimodal, multi-provider incentives that would not time around. At the same time, attitudes may change be viable without it. Leveraging the MaaS platform, to better align with current travel behavior to reduce non-monetary incentives for behavior change such the cognitive dissonance of users (Kroesen, Handy as in-app information display, gamification, leader and Chorus, 2017; Moody and Zhao, 2020). Users boards, and badges can also be employed to encour- of MaaS have indeed reported changes in attitudes age users to make more sustainable travel decisions. consistent with the direction of their modal shift: 64 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Box 9. Pecuniary incentives to influence behavior: The case of Rio de Janeiro’s women-only car Fear of sexual harassment and violence in public spaces is pervasive for women worldwide. A case study on public transit in Rio de Janeiro, Brazil, estimated the cost of harassment using crowdsourced data from 22,000 rides on Rio’s suburban train system: Supervia. In Rio, women in public spaces experience harassment on average once a week. To provide a safer space to ride, Supervia provides one women-only car on each six-car train. Half of Supervia’s passen- gers are women, thus only a fraction of all women riders can ride in the reserved space. Despite the low compliance (there are often a substantial number of men aboard), the women-only cars decrease woman’s likelihood of being subjected to physical harassment by half. The WB conducted an experiment to estimate the value of avoiding harassment attributed to the women-only cars in Rio. The study offered female participants pecuniary incentives to ride either the women-only cars or the other cars. The incentives varied from BRL $4.50-$4.70 for a set of five rides. The experiment was conducted in two stages. In the first stage, riders were offered equal pecuniary incentives and would choose freely whether to ride in the women-only cars or not, without any instructions. In the second stage, riders were assigned to the women-only car or the regular car, for a variable or fixed incentive. Although the objective of the experiment was to calculate the value attributed to the women-only car, it is an example of how a MaaS provider could influence behavior according to certain goals defined by the policy maker. By offering the monetary incentive, the study showed that 26% of participants are willing to give up at least 20 US cents in income to switch to the women-only car and that this will- ingness increases when there are fewer men in the women-only cars. This foregone payment is equal to BRL $1.17–$2.25 per incident avoided or approximately 0.4% of minimum wage annually. While the methodology has many limitations in terms of measuring the actual cost of harassment, it highlights that measures to mitigate harassment have substantial value, which should be considered when plan- ning a transport system. In the same fashion, the MaaS operator (or the policy maker) may choose to include pecuniary, infor- mational, or other incentives to encourage behaviors that create positive externalities (such as access- ing a metro station using a bicycle) or disincentive behaviors that cause negative externalities (such as using more polluting modes). Source: Kondylis et al. (2020) 65 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Box 10. Randomized transportation discount coupons: The case of 99/DiDi ridesourcing Since the arrival of ridesourcing in the Metropolitan Region of São Paulo (RMSP), there has been measurable use of this service as a last mile solution. About 7% of trips by 99/DiDi, a Brazilian-Chinese ridesourcing company, have origins and destinations at rail stations. And this use of ridesourcing to access rail stations is stronger in peripheral areas with lower penetration of high-quality public transit. In late 2018, the company implemented a pilot to investigate whether giving commuters a pecuniary incentive to access the public transit system via their services would increase the demand for public transit and for ridesourcing trips. The experiment offered riders a discount coupon for two weeks to get to and from a subway or train station of their choice via ridesourcing. Among their users, 4,650 individuals were randomly selected to participate and separated into a control and two treatment groups. The first treatment group was offered two 20% discounts per day limited to a total of R$10 discount per ride. The second treatment group received a single 50% discount per day. The results showed that the coupons influenced users’ behavior in the short-term. Having access to 20% or 50% discount coupons during those two weeks led to an increase of 1.3% in the proportion of rides taken to or from public transit stations. There was no visible difference between the two treat- ment groups that received different discount levels, indicating that even a relatively small pecuniary incentive could influence user behaviour in the short-term. However, the effects faded during the second treatment week, with no statistically significant coefficients for this period. This experiment showed that the cost of implementing nudge policies that work may not require high levels of subsidy. It is important to consider that the study was carried out in a few weeks and that, generally, people take time to change their behavior and prefer predictability in their daily travel. In an experiment that lasts longer, people’s willingness to make a change to their habit may increase— either due to the predictability of the discount or simply by the repetition of the new behavior. While the experiment focused on current ridesourcing users and there is no certainty of the perma- nence of these effects in the long-term, the results are encouraging as they indicate that well-planned policy and collaboration between mobility providers may influence consumers to choose greener travel modes. Given the habitual nature of travel behavior, longer experiments are necessary to assess the full cost-benefit of these policies. Source: Jacob and Ferreira (2020). 66 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Product design, such as the structuring of Improvements in mobility outcomes in develop- ‘mobility bundles,’ is another important MaaS ing cities will require coordinated efforts in MaaS mechanism to advance broader mobility goals. scheme development, sector policy, and infra- MaaS providers will generally offer mobility bundles, structure. First, MaaS providers need to utilize the which can be structured to promote the use of cer- mechanisms listed above—information, incentives, tain modes over others (Matyas and Kamargianni, and product design—to develop attractive MaaS 2019). While there is commonly an initial reluctance schemes that respond to identified customer needs. from the part of users to adopt the mobility bundle Larger mobility impacts, however, will require that concept, once they opt in, they are prone to try all the MaaS appeals to a wider population. To do so, MaaS different modes included in the bundle. Therefore, schemes will need to encompass a broader number the design of these bundles can be used to nudge of mobility services, offer various mobility bundle desired behaviors. For example, the ‘Whim Urban’ and pay-as-you-go options, and create affordable bundle in Helsinki included unlimited 30-minute services and packages tailor-made for low-income bike-sharing trips and taxi fare reductions for trips customers in various city geographies. Second, MaaS up to 5 km. This resulted in 97% of bike-sharing trips schemes can amplify the desired impacts of larger on the platform lasting less than 30 minutes and 87% policy or infrastructure changes (Lehner, Mont and of the taxi trips spanning 5 km or less (see Box 15). Heiskanen, 2016). For instance, the construction of a new cycling lane and bicycle parking facilities can be While many of the sustainable mobility benefits leveraged by increasing the number of bicycle share of MaaS come from encouraging multimodality trips included in new or existing mobility bundles; a through integration of services and product new policy raising the price of on-street parking can design, it’s important to recognize that transfers direct people to use ridesourcing more often14 and between modes have a penalty and may be a sub- consider purchasing mobility bundles with multiple stantial barrier for certain users. For example, the ‘green’ services in them; or the opening of a new elderly and other individuals with restricted mobility metro station may offer opportunities for a MaaS often face difficulty at interchanges between modes, scheme that integrates long-haul public transit trips which can be confusing and inconvenient. Without with first-/last-mile ICT-enabled mobility services adequate attention to universal access in transport to the new station. Third, after implementing MaaS infrastructure and service, the multimodal trips facil- schemes that are relevant to a wide range of users itated by MaaS may not be feasible for these users. and supportive policies and infrastructure, MaaS Therefore, the door-to-door user needs must be providers and governments can also collaborate to considered in trip planning. nudge consumers into making smarter, healthier, and greener choices. 14 Which in turn will require more kiss-and-ride curbside space. 67 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH 3.3 Impacts of MaaS in developing countries Developing countries are still motorizing. While from these services due to discrimination among motorization is low in most developing countries, it drivers or even embedded in the algorithms power- is rapidly growing, especially in Latin America and ing the service (Brown, 2018; Shaheen et al., 2017). Asia. The number of motor vehicles in the world is In particular, low-income people that cannot afford expected to reach about 2 billion by 2030 (Sperling ridesourcing fares and people requiring wheelchair and Gordon, 2008). By this time, 56% of the world’s accessible vehicles or other forms of assistance may vehicles will be owned by non-OECD countries, have benefited very marginally (if at all) from the compared with 24% in 2002 (Sommer, Dargay and introduction of ridesourcing services. Gately, 2007). The expected negative externalities of this growth are quite concerning, in terms of Furthermore, the broader societal impacts of increasing inequality in access, road crashes, con- car-based ridesourcing services have been wor- gestion, pollution, and reduced productivity. Even if risome. As they have been implemented to date, financial and technical constraints are overcome and car-based ridesourcing services have led to increases new, cleaner, and potentially safer technologies like in vehicle-kilometers-traveled often by substituting electric mobility and autonomous vehicles make up trips by active modes or public transit and have not a significant share of private vehicles, issues such as reduced car ownership (Diao, Kong and Zhao, 2020). inequality, congestion, and reduced productivity are While there is strong potential for these services to likely to remain. The goal of MaaS is, therefore, to complement public transit by serving as first-/last- focus on effective alternatives to the growing share mile solutions or replace costly fixed-route services of low-occupancy travel by private car or motorcycle, in lower density areas, government guidance and supported by strong governance of both mobility better integration with other modes through MaaS is and urban development (see Chapter 6). needed to truly unlock their potential in promoting multimodal lifestyles that do not require car own- While car-based ridesourcing has expanded ership (see Chapter 6. Governance). Without that mobility for some, inequities in access remain guidance, early evidence of the impact of ridesourc- an issue. A comprehensive review of ridesourcing ing on vehicle use and thus energy consumption and studies in both developed and developing countries emissions shows concerning signs. shows that having access to a car through ride- sourcing often improves the efficiency and comfort Impacts from motorcycle ridesourcing on urban of travel for users, particularly for people that do mobility vary widely among users. For instance, not own cars and some people that cannot drive in Jakarta, where motorcycle ridesourcing is quite (Tirachini, 2019). Ridesourcing services also improve popular, many users are middle- and higher-income rider-driver matching when compared to street citizens who used to travel by private car or taxi. For hailed taxis, reduce parking requirements (albeit these users, their shift to motorcycle ridesourcing sometimes at the expense of more vehicles-miles may have reduced their carbon footprint (Irawan et traveled), and have the ability to operate more al., 2019). Conversely, other motorcycle ridesourcing seamlessly as a complement to public transit trips to users are less affluent citizens who used to rely on improve first-/last-mile access. On the other hand, public transit. For these users, their carbon footprint not all users or neighborhood have benefited equally likely increased with their modal shift (Irawan et al., 68 MOBILITY AND TRANSPORT CONNECTIVITY SERIES 2019). Motorcycle ridesourcing in Jakarta has also behind this high-income skew in bike-share use worked as a first-/last-mile solution, serving trips relate to the allocation of stations in wealthier neigh- to and from the city’s high-capacity public transit borhoods (see Box 6) and the reliance on electronic system; the net change in carbon emissions after payment methods that might discourage lower the introduction of ridesourcing in these areas was income or unbanked users. Bike-sharing services marginal, with the pick-up distance (to fetch the pas- have helped re-shape the public opinion of cycling senger) being the deciding factor (Suatmadi, Cruetzig as a climate-friendly and healthy mode of transport and Otto, 2019). and helped raise awareness around the broader sustainable transport agenda among both policy On a trip-by-trip basis, bike-sharing services gen- makers and civil society. While cycling has a strong erate positive impacts for the users and for the potential to reduce emissions for a given passenger environment, albeit these impacts are of small trip15 (Massink et al., 2011), studies on the substitu- magnitude (for now). Bike-sharing services are very tion effects of bike-sharing services demonstrate that popular across the world and have shown to increase they primarily replace public transit, walking, or own cycling levels, improve the travel experience, and bicycle trips, and only to a lesser (but nonetheless enhance users’ health (Ricci 2015). While cycling was important) extent travel by car (Bigazzi and Wong, often associated with low socioeconomic status in 2020; Government of Mexico City, 2017; Kroesen, various countries (Dias Batista, 2010), bike-sharing 2017). There is also a strong potential for bike-shar- schemes in developed and developing countries ing to serve as a way to expand first-/last-mile access are generally used by higher-income populations to public transit services in key markets. (with a few exceptions). The most common reasons 15 Considering the lifecycle of bike-sharing systems, there are additional environmental concerns related to the impact of rebalancing the vehicles in these systems (often done by van) and the disposal of used vehicles that should also be carefully considered (see also Chapter 2. Supply). 69 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH MaaS has the potential to generate positive iv. Reinforcing these nudges with infrastructure societal impacts but only if firmly rooted in a sus- investments that promote greener modes—such tainable mobility framework. ICT-enabled mobility as improvements to public transit coverage and services and, for that matter, private MaaS schemes service, infrastructure for active mobility, and may not be naturally inclined to focus on societal transit-oriented urban development—and impor- benefits. They are typically conceived to capture a tantly, including the needs of all, including the demand niche and derive all possible monetary gains poor, in the design of systems. from fares and other revenue sources; the positive or negative externalities generated are not implicitly the concern of the providers. However, given the com- plexity of the transport system, a broader approach to MaaS may enable more systemic interventions to 3.4 Travel demand and MaaS advance societal goals. This will require that govern- in the wake of Covid-19 ments, civil society, academia, and the private sector develop a joint framework for service development The Covid-19 pandemic has affected demand and implementation, even when pursuing different for transport in a myriad of ways. Initially, social sets of goals. Under this framework, demand ele- distancing measures and fear of contagion cre- ments worth considering are: ated a strong decline in activity all over the world. Passenger travel was particularly affected. For i. Enhancing multimodality and encouraging users passengers, the pandemic brought huge declines in to shift from more polluting to less polluting travel on airplanes and by ground transportation, modes; with public transit being the hardest hit. The short- term effect of the lack of vehicular movement was a ii. Identifying ‘entry-points’ among young, not-yet- significant reduction in emissions. A few months into car-owning individuals with attitudes and life- the crisis, and especially after the first peak of cases styles more compatible with sustainable, shared had passed, road transport saw a resurgence leading modes (Rahimi, Azim and Jin, 2020), individuals to typical congestion levels while public transit rider- going through major life events who are chang- ship remained quite low compared to pre-Covid-19 ing their habitual travel behavior, and growing conditions. Emissions from ground transport also environmental and health concerns among the rebounded (Liu et al., 2020). The net, long-term general public; effects of the Covid-19 pandemic in the transport sector in terms of emissions, congestion, and air pol- iii. Nudging cleaner mode choices with monetary lution are still unclear given that behavior changes incentives and carefully crafted information pro- and mode shifts took place in multiple directions. vision and app-based defaults; and The following paragraphs outline the variety of the 70 MOBILITY AND TRANSPORT CONNECTIVITY SERIES effects the pandemic had on urban mobility and the With the decline in public transit ridership, com- potential role that MaaS can play in mitigating the peting motorized modes may advance. While car crisis and supporting “building back better.” purchases globally are still recovering, there is an imminent risk that lingering fears of Covid-19 infec- All over the world, public transit demand plum- tion will lead to an increase in car-purchasing fol- meted. The steep decline resulted from a combina- lowing the crisis; the driving force behind this is the tion of both decreases in economic activity and travel perception that one’s personal vehicle provides more in general and increases in fear of contamination safety and protection from the virus than public specifically while traveling on public transit. Only transit or other shared modes of travel (Ipsos, 2020). transit-dependent users who had to continue to During the height of the pandemic, motorcycles travel for work and had no alternative (such as a sales, despite growing considerably in richer coun- car or motorcycle) continued to use public transit in tries (Surico, 2020), slowed in Latin America, Asia, and the beginning of the crisis. They consisted mostly of Africa, with some regional disparities. Bicycle sales essential workers and people that could not afford on the other hand, have soared and many cities have time off work. Over a year into the crisis, public implemented emergency or pop up bike lanes (such transit demand is still much lower than business- as Bogotá, Colombia and Lima, Peru) to provide bet- as-usual in many cities, with strong consequences ter facilities for the bicycle as a Covid-safe mode. In to the fiscal sustainability of these systems. Many turn, with better air quality, biking may become more providers are reaching insolvency and services have attractive (Li and Kamargianni, 2018). After Covid-19, been reduced in many cities, with users facing even there is also an expectation that walking, biking, worse transport conditions (lower coverage and and micro-mobility might potentially become more frequency, service irregularity, and crowdedness) popular (Furcher et al., 2020), but the extent that this than they did previously. Yet some cities show resil- will happen will depend on governments making ience; the public transit network in Hong Kong, for the investments to implement more permanent example, is so much more efficient, affordable, and facilities to make these modes more efficient and convenient when compared with individual transport, safe. Anticipating and shaping the trajectory of urban that demand has mostly returned to normal as the mobility post-Covid-19 will be critical (see Box 11). pandemic has eased. 71 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Box 11. Travel behavior changes in the Covid-19 crisis: Are they permanent? One of the biggest impacts of the Covid-19 crisis has been the reduction in passenger transport demand, due to a combination of government lockdown, the economic crisis, and the fear of con- tamination when using shared transport modes. Beyond the effects of the economic crisis, which is directly correlated to travel rates, how much of what we are seeing in terms of the modal shift towards individual modes of transport (motorcycles, bikes) or substitution of personal travel (tele- working, teleshopping) is likely to linger? A key question for the transport sector is whether the crisis has resulted in a permanent change in preferences, or if behavior will revert to ‘business as usual’ when the crisis ends. While the current crisis is unprecedented, in terms of its scale of impact and government response, examining past crises can be informative. A clear example of modal shift in response to a crisis came after the London terrorist attacks in July 2005, when a series of bombs exploded in three London underground trains and one bus. Although the damaged underground lines reopened within weeks, the attacks had longer lasting impacts on the city’s commuting patterns. Londoners avoided under- ground journeys for months, often switched to other modes of transport such as cycling or personal cars. Bike retailers in London reported that sales quadrupled in the week following the attack and bike use increased by 13% from June to July. Research also suggests that one of the secondary impacts of the bombings was a 7-11% increase in vehicle particulate emissions, with long-term negative impacts on Londoners’ health. Later, with the implementation of the congestion charge policy, demand for pub- lic transit rose gradually, with levels of use returning in the following year (Transport for London, 2008). In the Covid-19 crisis, fear of contamination is likely pushing people out of public transit and into private vehicles. In Beijing, by August 2020 morning peak-hour traffic had risen above pre-Covid levels while public transit ridership remained lower than before the outbreak (Baiyu, 2020); commuters are likely opting to drive over taking public transit. In one survey of U.S. consumer sentiment, 20% of people who regularly used buses, subways or trains said they no longer would, while 17% of people indicated they would use their car more due to Covid-19 (IBM Institute for Business Value, 2020). The examples discussed above show that crises can stimulate lasting changes in mobility patterns, with some of these changes (such as growth in cycling) aligned with the sustainable transport agenda and others (such as growth of personal vehicle ownership and use) in the opposite direction. ICT- enabled mobility service providers may emerge from this crisis able to leverage increased interest in bicycles and other modes to help ensure sustainable transport behaviors persist. Most importantly, previous crises show that supporting policies are needed to promote sustainable behaviors and avoid negative consequences that can flow from people’s risk assessment in the wake of a crisis. Monetary, fiscal, or informational incentives can encourage greater use of active modes and prevent an increase in private car purchases, for example, when there are options like MaaS available. At a time when people will be feeling vulnerable, policies that increase trust in the safety of sustainable transport options are particularly important. Source: Sung and Monschauer (2020). 72 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Travel behavior is likely to change in the long- For example, some Asian cities adjusted their public term as a result of an increase in teleactivities, transit service plans, using real-time information to but it does not necessarily mean less travel. dynamically match service to demand. Technological Covid-19 has triggered an acceleration in digitali- innovation as pandemic response helped them zation16 and the rise of teleworking policies all over address crowding and contagion in public spaces. the world. In addition to increases in teleworking, Further, electronic payment interfaces allow for e-commerce transactions (or teleshopping) rose by contact-free fare exchanges, reducing person-to-per- 19% worldwide, including in developing countries. son interactions that could spread the virus during Still, the potential for teleactivities in developing the Covid-19 pandemic. Additionally, by providing countries is currently limited, with only 13 to 19% of updated information, for example on crowdedness occupations having the potential for remote work or re-routing, MaaS empowers the user to choose (ILO, 2020). And many countries are simply not ready; whether or not to travel (and possibly choose to they lack robust technological platforms, resilient have a service or a good delivered instead) or to shift internet infrastructure, and digital payment infra- towards another mode on a case-by-case basis. MaaS structure needed to support widespread teleworking could even go further and offer travel pre-booking, (Chakravorti and Chaturvedi, 2020). There are addi- especially during peak crisis periods. Finally, MaaS tional equity concerns when it comes to access to can also facilitate contact tracing, depending on local teleworking since the poor in both developed and regulations and acceptability of privacy issues. developing countries perform jobs even less predis- posed to teleworking. Nevertheless, a few elements MaaS has the potential to support sustainable are important to consider for developing countries. public policies during the recovery period. If First, digital payment systems are already a reality embedded in a sustainable mobility paradigm and in middle-income countries and growing quickly in complemented by targeted environmental and social low-income countries. Second, the share of telework- policies, MaaS can be strategically used to support ing jobs in cities is much higher than in rural areas, the “building back better” initiative. MaaS can mit- and this concentration might be significant in some igate intentions to purchase a car or a motorcycle larger cities, especially in middle-income countries. by offering a range of attractive and more efficient Third, teleworkers are potentially higher-paid profes- options—leveraging ICT-enabled mobility services sionals, with higher motorization rates. These three and public transit where each mode is strongest. elements make a more compelling case to assume MaaS can allow smarter trip planning, offering the that teleactivities in developing cities should be thor- user more information on off-peak hours or alter- oughly considered as a demand management policy, native modes of transportation. MaaS at “its best,” as they can help cities reduce gridlocks during the however, would occur when it expands accessibility commuting peak hours and may result in net avoid- to opportunities for people that were previously ance of trips (Andreev, Salomon and Pliskin, 2010). underserved by individual urban mobility options, preferences efficient and green modes of transport, MaaS has the potential to support sustainable offers an affordable price, and nudges people to public policies during a health crisis. The user-cen- make smart decisions accounting for the real costs of tric design, responsiveness, and flexibility offered different travel choices (see Chapter 6. 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MaaS platforms aggre- gate, distribute, process, and validate all flows of data and payments among policymakers and regulators, mobility service providers, and other actors participating in the MaaS scheme, while providing a seam- less experience for the user. • Data adequacy, compatibility, and security are fundamental to the viability of MaaS platforms. To ensure such viability, four aspects need to be considered: (i) high quality data availability, (ii) data stan- dardization, (iii) interoperability by design, and (iv) security, privacy, and ownership agreements. • Financial technology (fintech), digital payments, and ticketing are critical considerations in the deployment of MaaS platforms. Given that payments are often integrated within a MaaS platform, fintech plays a key role in MaaS deployment. From allowing in-app payments to providing subscriptions to mobility bundles and other incentive, digital payment systems enable higher levels of multimodal integration in MaaS schemes as well as new business opportunities for participating actors. While lower-income individuals have often found it difficult to access many online banking applications, new advances in mobile payment and alternatives such as smartcards can help over- come this barrier. • Two new trends facilitate ticket and payment integration in MaaS platforms: Open loop payments and account-based ticketing. • Many governments and other parties with limited experience in the development of digital applications tend to underestimate the resources required to successfully deploy and operate MaaS platforms. Considerable time and monetary resources are necessary to provide streamlined and user-friendly trip information, ticketing, and payment systems. 79 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH MAIN OPPORTUNITY/CHALLENGE FROM THE TECHNOLOGY PERSPECTIVE MaaS’s reliance on technology could either exacerbate mobility equity issues or catalyze efforts to bridge the digital divide and other inequities in access in developing cities. While emerging economies have lagged in the implementation of the technologies that underpin MaaS pilots in developed countries; however, local innovations in developing countries can bridge the digital and financial divides and unlock new opportunities for MaaS implementation. Issues surrounding universal access to smartphones and banking systems in emerging economies should not be seen as an obstacle to the imple- mentation of MaaS (which is built on these systems), but instead as a motivator of broader efforts to ensure technological inclusivity and access to banking among the bottom 40 percent. 80 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Technology is key to the development of MaaS countries, levels are still low. For example, Ethiopia platforms. Even though integrated, multimodal, has one of the world’s lowest smartphone pene- user-centric mobility has been a goal for decades, tration rates at about 11% (Newzoo, 2018). Middle- it is only recently that technology has enabled its income countries still have lower smartphone full realization. Technology enables the integrated penetration—e.g., around 25% in India, 40% in Kenya multimodal, multi-provider products and services and Indonesia, 55% in the Philippines, and 60% in and enhanced user travel experience at the core of Brazil and South Africa—compared to high-income MaaS. It is the digital advancement of the last couple countries—e.g., 66% in Japan, 81% in the U.S. and of decades that has enabled the plethora of new Australia, and 95% in South Korea (Silver, 2019). business models, connecting supply and demand There are also considerable gaps in smartphone for mobility in new and innovative ways. And as ICT ownership rates between older and younger gen- continues to develop (e.g., with 5G connectivity), erations (e.g., Indonesia) and between women and these flows of information and matching of passen- men (e.g., India) (Silver, 2019). Even with growing gers and vehicles is only slated to improve. Recent smartphone penetration, quality data networks advances in technology already enable the connec- are a problem in many developing countries. The tion of multiple mobility services in real time, provid- advancement of MaaS and its ability to benefit the ing information, trip booking, and payment options poor in these contexts will require dedicated strat- in one single platform. egies to bridge these gaps, such as implementing alternative user-interface tools or facilitating access Conversely, technology may be a barrier that to smartphones and internet connectivity. Therefore, prevents the poor from fully benefiting from addressing this “digital divide” is a critical component MaaS. Even though smartphone penetration and of MaaS implementation. internet data coverage are on the rise in developing 81 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH 4.1 Digital services integration MaaS platforms integrate a wide range of digital operational back end that processes and connects services, and function as intermediaries between service requests by users with various mobility demand and supply of mobility services (see providers. Each mobility service provider is also con- Figure 4). On the demand side, the front-end user nected to the MaaS platform, either through a deep interface (typically, the MaaS smartphone app) link, which summons the web (or app) content in the provides the direct link between the MaaS platform provider’s website, or through full API (application and the customers; through it, customers access program interface) integration, which enables direct the various MaaS services and products available. access to the providers’ data and the ability to submit Unbeknownst to its users who interact with a fully service requests and process payments. integrated front end, MaaS platforms have a complex Figure 4. MaaS functional structure End users Platform layer key functions Frontend layer App & website User interface/UX Customer management E-wallet (visual shoppng cart) MaaS Platform Retail layer Mobility retail Order ful lment Payment gateway Backend layer B2B/P2P platform API gateway Mobility service integration Dynamic multimodal routing/ matching API API API API API Order management Wholesale billing/booking/ticketing Service providers Data collection & storage/cloud computing Analytics Source: Adapted from Kanda (2019). Note: B2B = business-to-business; P2P = peer-to-peer 82 MOBILITY AND TRANSPORT CONNECTIVITY SERIES For mobility services to be fully connected to rapidly evolving nature of MaaS technology, platform MaaS platforms requires digital information and providers need to constantly improve, develop new payment integration. The level of integration will features, and integrate new services. determine the platform’s ease-of-use from the travel- er’s perspective. In some cases, governments may not be best suited to develop the technology for MaaS plat- • Integration of information allows users to access forms. There are many examples of public sector information on various modes and services in a development of MaaS platforms that have failed. smartphone app or other user interfaces. Only Governments have proven to be less effective in partial integration of technology platforms and being the sole developers of technology platforms data sharing is required. The MaaS platform has for MaaS, given their rigidity in procurement, legal direct access to key service information from constraints, election cycle discontinuities, lower tol- the mobility service providers (such as vehicle erance for risk and trial-and-error, and often slower availability, estimated travel time, etc.), while their development and response time. Furthermore, the booking and payment functions are not inte- skilled personnel needed to develop MaaS platforms grated; instead, users select the mobility provider (such as, systems engenieers, computer scientists, in the MaaS app and are then redirected to the back-end and consumer experience specialists) are specific provider’s app (on which they need to often lacking in the public sector, particularly in have a separate account) to book and pay for their developing countries. Therefore, the private sector trip. This deep linking prevents loss of contact with seems to be best suited for the development of MaaS the mobility providers, but requires the user to platforms, which require constant updates. download multiple apps, which offers a piecemeal user experience. Although governments may not be best suited to develop the technology for MaaS platforms, they • Integration of payment and booking requires full play a key role in the deployment of effective API integration. This enables the integration of all MaaS schemes. Government institutions can lead trip stages, including booking and payment, into the deployment of MaaS in partnership with private the MaaS platform. This level of technological providers though collaborative schemes or software integration is necessary to foster integration of as a service (SaaS) deployment. Alternatively, if mobility service provision and facilitate a truly governments decide to let a private provider lead seamless user experience. development and deployment, public authorities still play a key role in the definition of standards for the Developing the technology platforms for MaaS is technology, data and payments that will determine a resource intensive endeavor. Parties with little interoperability and fair competition within the sys- or no experience with digital applications tend to tem. Governments are also best suited for promoting underestimate the resources required to integrate transparency, coordinating stakeholder engagement trip information, ticketing, and payment successfully. and consultation, and issuing regulations (e.g., This includes time and monetary resources and regarding open data, competitiveness, safety, and highly advanced technical skills. Moreover, given the privacy) that facilitate the development of MaaS 83 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH platforms while safeguarding individuals’ rights’ and in a format that can be consumed by a wide ensuring societal gains. For example, MaaS schemes variety of software applications. GBFS (General that are envisioned and governed by a public transit Bikeshare Feed Specification) and MDS (Mobility agency, in partnership with private sector technology Data Specification) are more recently established developers, can be a great starting point. standards for data on ICT-enabled mobility services. Consistent and well-defined open data 4.1.1 Data integration standards can lower the cost and complexity of data integration; cities, mobility service providers There are various data sources integrated in a (both public and private), and MaaS providers MaaS platform from both the demand and supply all benefit from adopting and abiding by shared sides. Figure 5 outlines the complex data ecosystem data standards. within a MaaS platform. To ensure data adequacy, compatibility, and protection, it is crucial that data iii. Interoperability by design. Flexible data are (i) of high quality, (ii) standardized, (iii) interopera- approaches enable interoperability between ble, and (iv) adhere to clearly established security and different systems. Interoperability helps prevent ownership agreements to ensure privacy by design: lock-in to a specific vendor with proprietary technology and ensures a more flexible platform i. High-quality data availability. A MaaS plat- design. The development of a harmonized set of form’s ability to provide multimodal, multi interoperable data exchange formats and proto- provider digital services requires the exchange cols can help bridge different existing technolo- of multiple trip attributes for each of the partic- gies and standards. ipating mobility services in real time. The data need to be accurate and complete for the MaaS iv. Security, privacy, and ownership agreements. schemes built around them to succeed. Public The growing reliance on data, data services, transit providers in developing cities may require and technology raises new vulnerabilities and significant investments in their digital platforms, risks in the transportation field. Cyberattacks communications technology, and network con- may compromise the functioning of the trans- nectivity to be able to provide high-quality data to portation system and the privacy of individual MaaS platforms (see Box 12). users. Accordingly, all shared and collected data through the MaaS platform should be secure and ii. Data standardization. Data standards define protect privacy by design. State-of-the-art tech- the rules by which data are recorded so that nologies and procedures are necessary to store, information can be easily shared, exchanged and access, process, and deliver sensitive mobility understood. One example of a broadly used data data. Furthermore, data ownership rights and standard is the General Transit Feed Specification responsibilities should be agreed upon among (GTFS), which allows public transit agencies the different stakeholders to ensure fair and to publish their vehicle routes and schedules responsible data use. 84 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Figure 5. High-level conceptualization of a MaaS data ecosystem. Demand Side - Consumer Data Supply Side - Provider Data Third party User Profile: Travel data: hosting provider Scheduled public transport data: (data servers) Registration information Origin Timetables (required): Destination Modes Time of travel Stop locations Phone number Acceptable modes Travel costs Country of use Trips Provider Registration information Cost (optional): Available private transport Location MaaS options (shared or rental): Calendar access Interaction data: Platform Profile and payment: App purchases Mode availability Downloads Cost Name User agreements Location Date of birth Request Duration of availability Email Communication Payment method(s) Trips Address Cost On-demand transport options Favourite places (such as car or bike share, or taxis): IP address Third party (optional) Access times Photo (optional) payment Browser and/or Mode availability application type service Cost Sites linked from Location Duration of availability Source: Adapted from Cottrill (2020). Box 12. Integrating transport data: The Digital Matatus Project in Nairobi Many cities in the developing world rely on informal networks of minivans and buses to move people around, but these systems are largely invisible to planners (Shulman, 2015). To help solve this data gap, the Digital Matatus Project collected data for informal public transit systems in Nairobi, Kenya and made it available to the public. The project used mobile phones and other technologies, which are increasingly prevalent in developing countries, to collect and deliver data in a modified GTFS format for routes of informal transit providers. Data were collected using an application called TransitWand (developed by a company called Conveyal for the World Bank) by a small team of students that, for five months, surveyed each route multiple times to ensure consistency. The students either hopped on the bus or followed the bus in a car. 85 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH A strong interaction with the general community and the transit agencies generated trust in the data, ensuring later use. The data were made open to the public, which facilitated the development of many applications using the routing data (Ma3Route, Sonar Flashcast, Matatu Maps, Digital Matatus and Transit App), which are now in use among everyday travelers in Nairobi. The Kenyan government uses the data as the official transit map. Further, many international organizations have been using the data for their projects (e.g., ITDP, UN-Habitat, and the World Bank). This intense community participation has also created awareness on the benefits of sharing transit data among all stakeholders in the urban mobility ecosystem, instead of keeping the data only for operators with their own business objectives. Consistent data is the basis of a MaaS platform and shared and standardized data opens space for players to explore new services. Source: Shulman (2015) and Williams et al. (2015). 4.1.2 Ticketing and payment integration Digital ticketing and payment bring benefits to both transportation providers and users. Most For multi-provider MaaS schemes, digital tick- ICT-enabled mobility services have implemented eting, digital payments, and fintech are critical. digital ticketing and payment functionalities from the Digital ticketing refers to the ability to issue, store, outset, while public transit systems lag in their imple- and validate tickets for mobility services through mentation. For public transit providers, in addition a digital platform, typically a smartphone app to opening the doors to MaaS, digital ticketing and (although SMS-based functionalities also exist). payment decrease boarding times (which increases Digital payments enable the creation of ‘virtual cash service efficiency) and reduce fraud potential in cash wallets’ for mobility.17 Advancements in these various transactions. Moreover, a coordinated and unified technologies provide the ability to easily issue and deployment of digital ticketing and payment can pay for the products and services that are the core of eliminate the need for each public transit operator MaaS—from integrated, multimodal, multi-provider to have specialized ticketing hardware and software. fares for single trips, to more complex mobility For users, digital ticketing and payment eliminate the bundles—through smartphone apps and other risks associated with carrying cash and increase user platforms. convenience. 17 In typical transactions, the credit card/debit card brands charge a flat + percent fee over each exchange. This has limited the use of digital payments based on credit/debit for micro transactions due to the flat fee per transaction. However, in virtual wallets the transaction through the credit/debit system is only made once, whereby cash is stored as virtual currency and charges are made against that wallet. This opens the possibility to use digital payments more efficiently for micro transactions, while also creating a new parallel business model leveraging the virtual outstanding balances. 86 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Two features facilitate ticket and payment inte- • Account based ticketing. ABT is a fare collection gration in MaaS platforms: open-loop payments system in which the fare media (be it smartcard or and account based ticketing (ABT). These modern mobile phone) does not store tickets or monetary ticketing systems should be designed to work with value; but instead holds the reference number to other types of payment and ticketing systems, such a customer account in a cloud-based back office. as prepaid cards, tokens, QR codes, or other non-ABT Fare media readers collect this number and initi- technologies (see Box 13). ate the processing of the ticket to the customer account in the cloud. ABT ensures that if a users’ • Open-loop payments. A payment system is smartcard or smartphone is broken or stolen, a regarded as open loop when it is widely adopted new one can be issued carrying the full value of by different actors and when additional partic- the account. ABT also provides more information ipating actors can be added with ease. This is to the operators, unifying an individual’s trips in contrast with closed-loop systems, which are across different forms of payment and modes— owned by a single entity and cannot be used for providing a more comprehensive picture of travel outside payments without special dispositions demand. ABT can be designed to accept open or from the owning entity.18 Open-loop payment closed-loop payments. While ABT systems provide systems involve a liability shift, from mobility benefits to both users and operators, they have providers to credit/debit providers, introducing two main shortcomings: they heavily rely on data financial institutions to the world of MaaS. Open- networks (to verify if users have transportation loop systems allow mobility service providers to rights in their account) and are susceptible to move away from costly in-vehicle hardware for hacking (due to their data centralization). Still, ABT processing each transaction, to ‘lighter’ in-ve- is an important enabler of more advanced MaaS hicle readers that communicate with a central schemes as it can facilitate the distribution of server that processes transactions. Although the targeted subsidies, incentives, and more complex initial deployment of open-loop systems can be transactions. costlier and more complex, open-loop systems can provide cost reductions in the long run since Standardization, interoperability, security, and they utilize more economic hardware and do not privacy are also paramount in ticketing and require a dedicated recharge network (Streeting payment. As with the deployment of all technolo- and Howe, 2016). For existing systems, the tran- gies within the MaaS platform, the deployment of sition to open-loop will take time and resources; payment systems will require the development of therefore, it is likely that open-loop systems will standards that will determine interoperability and need to co-exist with closed-loop systems during flexibility. For example, open payment standards a transition phase. Nevertheless, open-loop and specifications are necessary in relation to payments ease interoperability for multimodal MaaS to ensure interoperability, reduce costs, and transportation, and, therefore, are an important accelerate payment integration. Therefore, it is key element in MaaS schemes. that governments ensure the interoperability and 18 First-generation public transit smartcard systems were generally implemented as closed-loop systems. 87 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH standardization of payment systems to avoid vendor In addition to this digital divide, certain indi- lock in and encourage healthy competition among viduals—particularly the elderly—also face a mobility service and MaaS technology providers. technological divide that may be a barrier to accessing MaaS. Accelerated use of digital products poses a challenge for the elderly who may not be as 4.2 The digital, technological, familiar with how to engage with technology. In order to ensure that these individuals have equal access to and financial divide and mobility services on MaaS platforms, special attention should be paid to the design of the API and, where sector informality possible, alternatives to app-based booking such as dial-a-ride options can co-exist for users who are not While technology has been a driver for the familiar with the operations of smartphone apps. development of MaaS platforms, it can also be an important barrier to MaaS adoption. The digital The larger share of unbanked people makes the divide refers to the uneven distribution in access or implementation of MaaS more challenging in use of digital technologies. In the context of MaaS, it developing countries. In 2017, 94% of adults had a can refer to the gulf between those who have smart- bank account in high-income countries versus only phones, mobile internet connectivity, and access to 63% in developing countries (Demirguc-Kunt et al., financial services that are digitally connected, and 2018). Globally, an estimated 2 billion adults lack those who do not. High smartphone penetration, access to formal financial services. This lack of access mobile internet availability, and financial inclusion to (digital) banking services can prevent people from are necessary to make MaaS accessible to all inhab- accessing MaaS and its benefits. itants in the city. Otherwise, individuals without smartphone and mobile internet and the unbanked Informality in transport provision might further cannot fully enjoy all the mobility services that MaaS constrain the deployment of MaaS. Informal public can bring. transit operators may find it difficult (financially and legally) to share their service information (e.g., The vast majority of people worldwide live within fares, routes, schedules, etc.) in digital platforms as range of a mobile-cellular network signal, but required by MaaS or to equip their vehicles with the the percentage of people using the Internet is necessary technology to enable MaaS. Ideally, a com- still limited. By the end of 2018, 51.2% of individuals bination of automatic vehicle location and automatic worldwide were using the Internet (ITU, 2018). This fare collection systems would inform the users of percentage varies significantly by country: around these services through the MaaS interface. However, 75% of individuals in high-income countries are despite the fact that these technologies have become online compared to around 40% in low- and mid- much cheaper over the years, they can still be unaf- dle-income countries (Bahia and Suardi, 2019). This fordable for small, local informal service providers. percentage is only 20% in the 47 least developed countries in the world. 88 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Alternative technologies can help bridge the (along with trip information) can be printed at digital and financial divides in developing coun- home, convenience stores, or internet cafes. SMS tries: smartcards and micropayments. Given the banking and ATMs provide alternatives to top up smartphone access, connectivity, and banking lim- MaaS accounts (be it the digital or the smartcard itations in many emerging economies, public sector version). Charging points at certain convenience agencies and private service providers are creating stores can be made available for unbanked indi- non-traditional technologies to bring a larger portion viduals.19 These are some of the options that the of the population into the digital world—and hence ridesourcing company GoJek offers its users to the world of MaaS platforms. top up their accounts (2020). • Traditional smartcards can serve as a MaaS user • Mobile- or smartphone-based micropayments interface for individuals with no smartphone also provide an alternative for the unbanked in access, where smartcards can also unlock bike- many developing cities, particularly in Africa. share and scooter-share vehicles. For frequent Therefore, MaaS fare and payment schemes system users, smartcards are being transformed should be designed with flexibility in terms of fare to enable payment for multimodal, multi-provider media and in terms of the types of digital pay- services. For less frequent users, digital tickets ments that can be received (see Box 13). 19 Note that individuals with Mobile Money, popular in African countries, are not considered unbanked in the MaaS context. These individuals could use their Mobile Money account to top up their MaaS accounts via their mobile phones. 89 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Box 13. Innovations in fare collection systems in Africa: Maputo, Mozambique Traditionally, fare systems have been viewed as a core activity of public transit service providers. However, fare systems are experiencing significant change, reflecting broader societal transformation and disruption in the ways people pay for and receive goods and services. Africa has been a center of rapid growth in micropayment services and mobile- and smartphone-based transactions as well as the technical, sales, and administrative platforms that support them. Yet most public transit fares in Africa are still paid using cash. There is an opportunity to tap into the payment and technology innovation in Africa to enhance transport services, especially among the dominant informal operators. In the capital city of Mozambique, the newly established Maputo Transit Authority (AMT) is currently introducing a new smartcard fare payment system (FAMBA). To start, the new FAMBA fare system will be installed on 400 buses that were recently purchased by the national government in 2017. Operators wishing to access these buses were required to form cooperatives, of which there are now eight, with fleets ranging from 30 to 70 vehicles, operating along six main corridors in Maputo. AMT has opted for a pure account-based, back office-centric fare system design. The user will pur- chase the card at one of 52 kiosks where associated accounts can be set-up, although there are plans to extend to ordinary retailers. The cards are loaded using cash, credit or debit cards, or mobile money services. The system takes full advantage of a wide range of fare media that may potentially be used for paying travel fares or for loading money, so long as such media can be securely linked to each individual’s back office account. It is also envisaged that the accounts individuals will set up in Maputo’s fare system will also have the capacity to be used to make micropayments for non-mobili- ty-related purchases in the future. The technology was specified with the objective of lowering the cost of designing, implementing, and operating the fare system. It can be extended with relative ease, providing integrated ticketing and interoperability across all public transport services within the Metropolitan Area of Maputo. Understanding that informal transit operators in the city often operate on very low margins and do not have the capital resources to invest in technological upgrades, the system will also be offered to minibus or minivan operators at a subsidized rate equivalent to only 30 percent of the cost. Yet finan- cial arrangements and other challenges of implementation are still to be resolved. In the future of transport services in Africa, standards such as FAMBA’s account-based design are critical as different participants in a system work together. This will be key in the development of fare systems and the payment and service integration aspects of MaaS. However, the approach towards integration should not be seen only from the lens of technological interoperability. Interoperability is a necessary but not sufficient condition for integration, as the latter also requires agreements among relevant participants. Source: Adapted from Arroyo-Arroyo, van Ryneveld, and Finn (2021). 90 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Similar workarounds are available that can Broader policies that facilitate and foster the bridge the technological barriers to include digital and financial inclusion of all will enable a informal transit providers and users in MaaS more inclusive deployment of MaaS. MaaS benefits platforms. Informal transit providers can join an from policies that directly tackle the digital divide by existing sharing platform or join forces, possibly with improving digital access and skills. The coordinated support from transportation authorities, to establish deployment and development of transportation and a new sharing platform. For example, in Delhi, India, ICT policies can help individuals beyond the deploy- private rickshaw operators have been successfully ment of MaaS. ICT policies can also allow for in-trip integrated into a MaaS platform (Roy, 2019; also see multitasking, which can improve travel experiences in Box 2). In situations where automatic vehicle location public transit and for-ride mobility services (Varghese equipment is not affordable, they can be replaced by and Jana, 2019). The deployment of MaaS provides a smartphone-based GPS tracker owned by the vehi- a unique opportunity to coordinate broader ICT cle driver. Further, offline MaaS app functionalities initiatives that improve digital, financial, and social allow individuals to download routes and tickets prior inclusion in developing cities. to the trip and WiFi hotspots can provide users with in-trip updates when well planned. References Arroyo-Arroyo, Fatima, Philip van Ryneveld, and Brendan Finn. 2021. Innovation in fare collection systems for public transport in African cities. World Bank, Washington, D.C. https://www.ssatp.org/publication/ innovation-fare-collection-systems-public-transport-african-cities Bahia, Kalvin, and Stefano Suardi. 2019. The State of Mobile Internet Connectivity 2019. GSMA Connected Society Program, London, U.K. https://www.gsma.com/mobilefordevelopment/wp-content/uploads/2019/07/GSMA-State-of-Mobile- Internet-Connectivity-Report-2019.pdf Cottrill, Caitlin D. 2020. MaaS surveillance: Privacy considerations in mobility as a service. Transportation Research Part A: Policy and Practice 131, 50–57. https://doi.org/10.1016/j.tra.2019.09.026 Demirguc-Kunt, Asli, Leora Klapper, Dorothe Singer, Sabuta Ansar, and Jake Hess. 2018. The Global Findex Database 2017: Measuring Financial Inclusion and the Fintech Revolution. World Bank Group, Washington, D.C. http://hdl.handle. net/10986/29510 Newzoo. 2018. Global Mobile Market Report. https://newzoo.com/insights/trend-reports/ newzoo-global-mobile-market-report-2018-light-version/ 91 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Gojek. 2020. “How to Top Up GoPay.” https://www.gojek.com/gopay/cara-top-up/ International Telecommunication Union [ITU]. 2018. Measuring the Information Society Report 2018 - Volume 1. ITU: Geneva, Switzerland. https://www.itu.int/en/ITU-D/Statistics/Pages/publications/misr2018.aspx Kanda, Tomoko, and Brian D. Taylor (2019). Advancing a Mobility-as-a-Service: Lessons Learned from Leading-Edge Public Agencies. UCLA Institute of Transportation Studies. Streeting, Mark, and Douglas Howe. 2016. Contactless Payments and Open-Loop Ticketing: What does this mean for transit authorities, and is there a business case for adoption? L.E.K. Consulting LLC, London, U.K. https://www.lek.com/sites/ default/files/insights/pdf-attachments/LEK_Mastercard_Contactless_Payments_Mark_Streeting.pdf Roy, Sidharatha. 2019. Delhi: Govt drive to make all autos install functional GPS device, panic button. The Times of India, December 29. https://timesofindia.indiatimes.com/city/delhi/govt-drive-to-make-all-autos-install-functional-gps-device- panic-button/articleshow/73012805.cms Shulman, Ken. 2015. Novel research project produces the first map of an informal transportation system in Nairobi. MIT News. https://news.mit.edu/2015/digital-matatus-project-makes-invisible-visible-0826 Silver, Laura. 2019. Smartphone Ownership Is Growing Rapidly Around the World, but Not Always Equally. Pew Research Center: Global Attitudes and Trends, February 5. https://www.pewresearch.org/global/2019/02/05/ smartphone-ownership-is-growing-rapidly-around-the-world-but-not-always-equally/ Varghese, Varun, and Arnab Jana. 2019. Interrelationships between ICT, social disadvantage, and activity participation behaviour: A case of Mumbai, India. Transportation Research Part A: Policy and Practice 125, 248–267. https://doi.org/10.1016/j.tra.2018.06.009 Williams, Sarah, Adam White, Peter Waiganjo, Daniel Orwa, and Jacqueline Klopp. 2015. The digital matatu project: Using cell phones to create an open source data for Nairobi’s semi-formal bus system. Journal of Transport Geography 49, 39-51. https://doi.org/10.1016/j.jtrangeo.2015.10.005 92 MOBILITY AND TRANSPORT CONNECTIVITY SERIES 5. Business 93 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH KEY TAKE-AWAYS FROM THE BUSINESS PERSPECTIVE • MaaS business models offer a compelling value proposition to each participating actor. Customers, mobility providers, MaaS providers, and government agencies, can each benefit from the MaaS scheme in different ways. • MaaS business models require establishing multiple revenue streams. In order to cover the costs of service provision and offer attractive fares to customers, MaaS businesses commonly develop other revenue sources such as ancillary customer services, advertis- ing revenues, data revenues, and government subsidies. • MaaS business models are often first implemented as pilots. This approach allows all participating actors to identify unforeseen barriers to implementation, to assess the long-term viability of the business model, and to make any necessary adjustments. However, pilots should not be the end goal. MaaS schemes should be imple- mented with the goal of scaling up and making permanent successful interventions. • There is a solid business case for MaaS in developing countries. There is a glaring demand for the improvements in mobility that MaaS could deliver, and numerous ICT-enabled mobility services have already proven their viability in these contexts. However, there are a number of strategic interventions—including improvements to exist- ing transport infrastructure and new regulations around innovation and integration—that are necessary to potentiate the MaaS industry, which require government action. MAIN OPPORTUNITY/CHALLENGE FROM THE BUSINESS PERSPECTIVE Government intervention will be crucial to channel MaaS busi- nesses towards achieving strategic policy goals in emerging economies. While MaaS and ICT-enabled mobility services may be seen as marginal services diverting resources from advancing core transpor- tation policy goals, the reality is that government action in shaping this space is critical. Strategic interventions act as a catalyst and a signal to the market of where government wants the industry to evolve. 94 MOBILITY AND TRANSPORT CONNECTIVITY SERIES 5.1 A complex balance Structuring mutually beneficial opportunities against one another in a zero-sum game for every among various actors is the basis for the MaaS fare-paying customer. In such a system, transit business model. For instance, multimodal trip providers are typically concerned that, by integrating planner providers—like Google Maps, Citymapper, or fares with ICT-enabled mobility service providers Transit App—depend on mobility service providers (e.g., an integrated fare for a long-haul transit trip (public and private) to share their route, schedule, and a complementary first-/last-mile ridesourcing and vehicle location data openly. The trip planner trip), they open the doors to losing ridership to providers focus on developing and operating the those modes and risk their own long-term viability. technology platforms and customer facing tools that Similarly, the attractiveness to customers of an inte- enable trip planning functions. In this model, the grated fare scheme commonly depends on the dis- mobility service providers benefit from being part of count offered by the integrated fare product vis-à-vis an efficient tool that facilitate customers’ access to the individual fares for each trip; however, it is quite their services, while the trip planner providers benefit challenging for both transit and ICT-enabled mobility from ancillary business opportunities derived from services to offer further discounts when their individ- bringing customers on to their platforms (typically ual fares are already not enough to recover their own advertising or data sales). operating costs per trip. Multimodal, multi-provider service integration It is worth noting that not every actor partici- requires the standardization of fare policy and pating in a MaaS scheme is driven by economic fare media, increasing the complexity of aligning profit. For example, transit agencies20 and other gov- interests among mobility. Traditional urban mobil- ernment entities are primarily driven by policy goals ity systems set different modes and service providers and the overarching aim to advance public good. 20 Transit agencies being different than transit providers in this context, as transit providers are often private entities themselves. 95 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH MaaS creates a broader system for collaboration avings in transportation expenditures from fare • S among various actors and for resolving conflict- structures that incentivize multimodal mobility at ing interests. Coordination of multiple mobility both the trip and multi-trip levels; providers (both public and private) in a MaaS scheme allows for a more strategic distribution of revenues echnology tools and fare media that offer con- • T according to the value proposition of each actor venient access to multiple modes and mobility participating in the scheme. MaaS also facilitates service providers; creating new revenue opportunities around mobility services that can help deliver more attractive fare bility to optimize travel choices based on per- • A products or to compensate for other implemen- sonal preferences regarding travel time, cost, tation and operational costs in the MaaS scheme. route, or environmental impact, for example. Thus, implementations of MaaS will likely require a dedicated commitment from governments to bring Mobility operators: additional resources into the mix and to create new regulations that facilitate MaaS business models. pportunity to offer more comprehensive multi- • O modal mobility products to customers, leveraging each provider’s strategic market strengths; 5.2 The MaaS value • Increased access to a larger customer base and proposition new revenue streams; • Streamlining of fare media, data sharing proto- The first step to implementing a MaaS scheme is cols, and regulatory requirements across multiple to frame a convincing value proposition for each mobility providers; actor involved. The main actors in any MaaS scheme include customers, mobility providers, transit • Potential to leverage benefits of technological agencies (a unique kind of mobility provider), MaaS innovations developed by (and data collected by) providers, and government. Building on the work of partner service providers. Falconer, Felder, and Zhou (2018), the value proposi- tion for each actor includes: Transit agencies: Customers: • Opportunity to bolster the transit network’s coverage and enhance service efficiency through • I mproved ability to move about the city—regard- multimodal integration, thus increasing ridership less of location, time of day, day of week, or and expanding the customer base; purpose of trip—through coordinated mobility ° In particular, opportunity to address existing services tailored-made to address the increas- gaps in the transit network, including first-/ ingly complex travel needs of all sociodemo- last-mile connections in peripheral areas, and graphic groups; higher quality services during off-peak hours; 96 MOBILITY AND TRANSPORT CONNECTIVITY SERIES • Potential to reallocate resources away from low Governments: ridership, high cost routes towards high produc- tivity, oversubscribed routes, without compromis- • Improved mobility and accessibility for city dwell- ing overall coverage; ers, with potential to reduce congestion, local air pollution and carbon emissions; • Culture of innovation, which can lead to new part- ° Particularly, opportunity to enhance mobility nership models, new technology tools, growing for the bottom 40 percent and other user institutional knowledge, and improved customer groups through implementation of ICT-enabled satisfaction. mobility services and special fare products; MaaS providers: • Potential to allocate greater space for public transit, active modes, and green space rather than pecialization in a role dedicated to integration • S cars; and other value-add aspects of MaaS (e.g., tech- nology tools or fare products), leaving mobility • Reduced competition for customers on the streets service operations to mobility providers; by multiple modes and providers, moving towards a more coordinated, multimodal system; bility to improve product offerings over time • A from direct interaction with customers and com- • A more flexible and redundant mobility system prehensive data collected; that ensures resiliency in cases of extreme weather and other extraordinary events and • Sound business to negotiate discounted bulk pur- evolves organically with new technologies and chases of mobility services; service innovations; • Opportunity to structure a growing number of • Improved understanding of how people move revenue streams such as premium membership around the city that can inform transportation fees, advertising revenues, etc. infrastructure and service planning and new policies. 97 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH 5.3 Costs and revenues The primary challenge of implementing a prom- costs. Similarly, while the cost structures of ICT- ising MaaS scheme in the real world is striking enabled mobility services are less clear to the public a balance between costs and revenue streams (and vary across mode and provider), there are among participating actors. Most transit providers sufficient indications that their fare levels commonly have operating costs greater than their fare reve- do not cover their operating costs (see Box 14). As nues, thus requiring government subsidies to be private actors motivated primarily by profit, it is less viable. And participating in MaaS schemes involving likely that ICT-enabled mobility service providers integrated fare products with other providers as part agree to lower their fares or absorb additional costs of a mobility bundle often requires that transit agen- unless the long-term benefits of the MaaS scheme cies accept even lower fares or take on additional are evident. Box 14. Ridesourcing still on the path to profitability Ridesourcing companies such as Uber and Lyft have announced that they are on the path to prof- itability (Belon, 2020). Both companies have historically relied on heavy subsidies to attract riders and expand into other areas. The strategy still depends on “winner takes most,” a belief that the ridesourcing company with the largest market share will walk off with a disproportionate chunk of the industry’s profits. So far, things have not worked out that way. Didi Chuxing, which dominates the ridesourcing market in China, has taken on Uber in Latin America. As pressure to become profitable mounts in the ridesourcing industry, companies have decreased discounts and promotional incen- tives to the user. It is believed that ultimately autonomous cars will change the ridesourcing business model for the better, based on the idea that the driverless future comes relatively soon and reduces costs signifi- cantly. Even if autonomous vehicle technology is adopted on the most optimistic timetable, though, it may not do enough to bail out the business model, as maintaining a fleet of cars would be “a huge capital cost” that outweighs the savings from not having to pay for drivers (who bear vehicle costs in the current ridesourcing business model). 98 MOBILITY AND TRANSPORT CONNECTIVITY SERIES The implementation of MaaS schemes—by an • Mobility bundles. Customers pay a periodic independent MaaS provider or by a mobility pro- (generally monthly) subscription fee for using vider—brings about additional investment and selected services within the MaaS scheme. These operating costs. The investment costs relate to the subscription fees should amount to significant initial development of the MaaS scheme, and include savings for the customers when compared to capital costs, technology development, and brand regular pay-as-you-go fares over the determined creation and marketing, among others. The operating period of time. The mobility bundles may include costs cover the day-to-day operation of the MaaS an unlimited use of certain services (e.g., mass scheme and may vary according to the nature of the transit), a fixed number of trips or cash to spend scheme and the number of users or transactions. on other services (e.g., bike-share, ridesourcing, MaaS operating costs could include marketing and etc.), and special accommodations for multimodal customer service, operation and maintenance of dig- trips. Different bundles can target different mar- ital platforms, service provision, insurance, and data ket segments (see Box 15). security (Polydoropoulou et al., 2020). • Fare capping. MaaS schemes may also allow MaaS schemes can generate various revenue for customers to pay-as-you-go up to a certain streams to advance their overall viability. These amount of money or a given number of trips revenue streams can be categorized in two main by selected services. This arrangement assigns groups: (i) fare-based revenues paid by customers customers to the most convenient mobility when using mobility services and (ii) ancillary services bundle offered a posteriori. Fare capping may be and additional revenue opportunities derived from especially important for expanding access to cost the core mobility services offered. savings through the MaaS scheme for low-income customers that may have difficulties committing 5.3.1 Fare-based pricing and revenues upfront to monthly subscription fees. • Pay-as-you-go options. Customers pay a single • Cash flows. In pay-as-you-go and fare capping trip fare for utilizing any service(s) included in the schemes, customers only pay for services con- MaaS scheme, with fare levels potentially varying sumed and the revenues flow on a trip-by-trip according to different trip characteristics (e.g., basis. In the case of mobility bundles, the custom- mode choice, time of day, distance, etc.). Ideally, ers pay before consuming the services, so the customers pay a single, integrated fare for multi- scheme receives the cash up front at regular inter- modal trips. vals; at times, customers may not even consume all the services that they paid for under the scheme. 99 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Box 15. Tailoring mobility services and payment options for different customers: The example of Whim Helsinki Whim Helsinki is a Finnish MaaS platform that gives its users access to all city transport services such as public transit, taxis, bikes, and cars, under a single subscription. The MaaS app provides a pay-as-you-go option as well as four different monthly subscription plans tailored to frequent urban residents, students, and occasional weekend travelers. The urban’s plan includes a 30-day ticket valid on all public transit services: buses, metro, ferry, and commuter trains. The student’s plan offers the same benefit for half the price of the urban one. Another option is the weekend plan, which offers car rentals for any weekend, a 15% discount on all taxi rides, a 30-day public transit ticket, e-scooters and unlimited 30-minute rides with city bikes. The unlimited plan offers the same options, plus taxi rides (up to 5 km and 80 rides per month), valid for everyday trips. In Europe, people pay on average €616 per month for owning and running a car (Roadzen.io, 2021); the top membership package on the Whim app costs less. The Whim proposal allows customers to choose from the most convenient mobility bundle to meet their needs and pay accordingly—all for less than the cost of owning a car. Because they can plan, book, and pay for travel via a wide range of transport modes, the travel experience becomes more seamless and provides door-to-door conve- nience that is closer to that of owning a car. Therefore, the subscription-based business considers the user’s willing to pay for this sense of freedom, and the company’s profit comes from the difference between the monthly fee and the price paid to mobility operators. 5.3.2 Ancillary revenues and loyalty programs to increase revenue and provide additional value to customers with higher • Ancillary services to customers. The MaaS willingness-to-pay; scheme may offer complementary services to customers for an additional fee. For instance, • Advertising revenues. MaaS schemes have vari- customers could purchase premium member- ous opportunities to garner advertising revenues. ships that give access to special services and First, the more widespread the use of the MaaS benefits (such as priority response when booking scheme and its digital platforms (i.e., smartphone ridesourcing services through the MaaS platform) app and website), the more attractive those plat- or could participate in loyalty programs that forms become for advertisers. Moreover, based provide rewards for frequent use. The commercial on privacy regulations, app terms and conditions, airline industry serves as one example of ways and technological capabilities, there are also clear that MaaS might innovate with ancillary services opportunities to offer more targeted advertising, 100 MOBILITY AND TRANSPORT CONNECTIVITY SERIES connecting clients wishing to use the MaaS plat- Government subsidy will likely play a crucial form for marketing with specific niches of cus- role in structuring viable MaaS schemes that tomers based on common trip patterns or even have a tangible impact on core policy goals such real-time locations tracked through the MaaS app as universal access, climate change mitigation, use (an indirect monetization of data); and poverty reduction. Through strategic regula- tory initiatives, governments can help improve the • Data revenues. Depending on existing privacy alignment between private actors’ interests and regulations and app terms and conditions, the core policy goals. Nevertheless, governments may MaaS provider and other participating actors may only be able to tip the scales decisively to ensure sell different sets of data collected from custom- MaaS schemes prioritize public good by bringing ers to companies specializing in the development new resources into the mix. For example, prioritizing of data intelligence services for public and private short trips to transit, offering lower fares to low-in- actors (e.g., Streetlight Data, Teralytics) or other come customers, or providing equitable levels of interested parties. service to customers requiring wheelchair accessible vehicles, will decrease revenues or imply additional For-profit MaaS providers may transfer some of costs for private mobility providers. Government their costs to participating actors rather than subsidies may be necessary to make private pro- (or in addition to) exploring additional reve- viders’ whole and ensure the overall viability of a nue sources. For example, some MaaS providers MaaS scheme. The rationale for these government also charge mobility providers (not costumers) a subsides is a simple extension of the rationale for the transaction fee for every trip booked, paid for, and widespread subsidization of public transit today since completed through their platforms. In other cases, MaaS can be envisioned and implemented as a public MaaS providers negotiate bulk pricing deals that service delivered through a combination of public allow them to purchase large volumes of trips at and private actors.21 discounted fares from public transit and ICT-enabled mobility service providers; they then sell those trips at full market value (or at a smaller discount) through their platforms and pocket the difference (König et 5.4 Implementation al., 2016). Both of these strategies have the effect of transferring the MaaS provider’s costs (or at least a Most MaaS schemes are first implemented on portion of them) to the mobility providers participat- a pilot basis, so that participants can explore ing in the MaaS scheme. Therefore, in these business and refine the viability of the scheme. The path models, the MaaS scheme needs to contribute to the to implementing a MaaS scheme will often prove mobility providers’ value proposition through other to be more challenging than expected, especially channels (e.g., improved access to customers, multi- if the scheme incorporates transit agencies and modal complementarity, increased demand, etc.) to government subsidies. For example, implementation make it worth the participation costs. of MaaS often requires adjusting long-standing 21 For additional discussion on the role of government in MaaS, including bringing additional public resources, see Chapter 6. 101 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH regulations typically not suited for MaaS (see Chapter Implementation challenges to MaaS will vary 6). It is also likely to require substantial stakeholder according to the scheme’s overall service con- negotiation, institutional reform of operators, and cept, the value proposition of the participating negotiation of mutually satisfactory contracts among actors, and local context and regulations. all actors given the uncertainties of whether cus- However, there are a few common challenges tomer demand and other revenues will follow expec- (and potential strategies to address them) that we tations. As such, pilots are often utilized to “test the describe below. waters” before making any type of commitment (e.g., regulatory changes, larger investments, etc.) towards The implementation of any MaaS scheme long-term service implementation. In addition, pilots requires that the participating actors establish may begin as smaller-scale partnerships or co-op- new relationships based on collaboration and erations between just a few modes or service pro- trust. Because MaaS schemes aim to integrate differ- viders, before scaling up to include others (Lucken, ent mobility service providers that often regard each Trapenberg Frick and Shaheen, 2019). other as competitors, early consideration and align- ment of distinct objectives is critical. Common points Even when a MaaS scheme succeeds in meeting of contention that should be addressed upfront key business and policy targets set by participat- include: (i) data sharing provisions, (ii) fair display ing actors during its pilot period, its long-term and marketing of different services in the MaaS plat- future and scalability are not guaranteed.22 It form,23 and (iii) distribution of risks, shared costs, and is not uncommon for private mobility providers to revenues (see Box 16). agree to lower profit margins during a short pilot period or for government agencies to absorb the There is a critical trade-off between speed to mar- costs of a one-time pilot. However, it is significantly ket and equity in MaaS implementation, both of more onerous for private actors to commit to which require a focus on customers. The fast pace accepting lower profit margins for an extended (and of innovation and competition in MaaS commonly undetermined) period of time or for governments to pushes both public and private mobility providers to approve new (and potentially larger) recurring costs. strive for fast implementation of new services to cap- Accordingly, planners need to design their pilots with ture market share. And, if a new service is not deliv- the awareness that these challenges await around ering on expectations, there is a tendency to adopt a the corner, proactively using pilot implementation to ‘fail-fast’ mindset, cut losses quickly, and go back to gather key data to build a convincing business case the drawing board. These tenets of business innova- to present to decision-makers in support of scalable tion, however, may go against governmental goals to and sustainable service in the long-term. advance the public good and protect disadvantaged communities. For example, regulations require 22 Hensher et al. (2020) discuss experiences in which it has been difficult to build on MaaS pilots. 23 This is especially important if the MaaS provider is also a mobility provider within the scheme. In this case, potential partners may be concerned that the host will favor their own services and jeopardize or hide other brands. 102 MOBILITY AND TRANSPORT CONNECTIVITY SERIES government agencies to conduct comprehensive market for a new MaaS scheme requires significant outreach processes to ensure impacted communities upfront investment in needs assessments and stake- have a say before long-term decisions are made holder engagement. Customer acquisition for a new about deploying a new service or cutting an existing MaaS scheme relies on effective matching of the type one. Accordingly, implementing a MaaS scheme com- and quality of services offered with the needs of local monly requires creative strategies to achieve speed customers and clear communication of the launch to market while collaborating closely and honestly of the service. Furthermore, there may be a need to with local communities. Even if framed as just a pilot, explain unfamiliar and innovative concepts to poten- MaaS schemes need to develop and grow a strong, tial users. diverse customer base. Careful consideration of the Box 16. MaaS for sustainable policy goals: The case of UbiGo, Gothenburg The UbiGo MaaS pilot is a good case study on the challenges to create better conditions for sustain- able urban travel and finding a profitable business model. The Go:Smart pilot was a six-month field test in Gothenburg, Sweden, in which 195 participants tested the UbiGo MaaS scheme for everyday travel. The service integrated both public and private mobility service providers into a new type of ‘public transit.’ The project’s goal was to reduce the number of private vehicle trips, increase the share of transit trips, and reduce emissions. The trial aimed to demonstrate how new business models and partnerships could reduce the need for private car ownership in favor of MaaS (Sochor et al., 2015). Public transit is the core UbiGo service; however, UbiGo did not profit on this service since customers would not buy the service if public transit within UbiGo were more expensive than normal. The only positive financial results came from car-sharing and car rental services. The experiment was successful in changing behavior—about 42.5% of participants stated changes in transport mode towards more public transit. As the targeted group (inner city) had such good access to public transit, they overestimated their use of car, and purchased combos with an amount of car travel that was left underutilized and, in the end, requested a refund. As a consequence, while partici- pants were highly satisfied, UbiGo did not achieve a profit. UbiGo’s MaaS pilot showcased that profitability and achieving environmental goals may not be nec- essarily aligned. However, it is possible that, as business grows, companies can get better deals with public transit providers and improve the financial returns. Additionally, the experiment was a success in reducing car use and therefore generate positive environment outcomes. The Swedish society may therefore choose to partially finance this societal objective with taxpayer’s money, as the reduction in car use can bring economic and environmental benefits worth a government subsidy. 103 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Local and regional governments will likely need Chapter 3). For higher-income residents, many look to restructure existing urban mobility regula- to private vehicles or car-based ICT-enabled mobility tions to support MaaS schemes. Most policy and services as a more convenient way to get around regulatory frameworks for urban mobility have despite the many negative externalities of this been structured around the traditional ‘ownership’ choice. MaaS businesses have a clear opportunity to model (see Chapter 1). More recent adjustments in provide novel combinations of services to meet the response to the rise of ICT-enabled mobility services demands of different user groups by leveraging the typically offer temporary relief rather than a strong combined potential of existing public transit services basis to leverage the potential of MaaS. Therefore, (formal and informal) and the growing number of new regulatory structures will be needed to support ICT-enabled mobility services. MaaS businesses (see Chapter 6). The rapid adoption of ICT-enabled mobility There is no one-size-fits-all MaaS scheme. MaaS services in developing cities suggests that MaaS and mobility providers often assume that a successful businesses may also be viable in these contexts. MaaS scheme in one context can be easily replicated The vast majority of car-, bike-, and scooter-sharing, in another. In practice, however, differences in regu- and ridesourcing services were first conceived in latory environments, local travel patterns, local trans- Western Europe and North America. Yet, over time, portation infrastructure and services, and customer they have expanded widely in Asia, Africa, and Latin demographics, needs, and preferences make repli- America. Whether multinational or domestic com- cability difficult. Therefore, MaaS schemes need to panies led the charge, ICT-enabled mobility service understand and adjust their business models to the providers demonstrated an ability to devise thought- particularities of the local context in order to succeed ful strategies to adapt business models to the (Kargas et al., 2019; Polydoropoulou et al., 2020). specificities of the transport system, the regulations, and the culture of each new city. Implementing MaaS business models in emerging markets will require similar flexibility in approach and will bring about 5.5 MaaS implementation in new challenges. emerging economies MaaS is still a burgeoning idea in Western Europe and North America, where most implementations There is a solid market for implementing MaaS have been qualified as pilots; as such, the lessons in developing cities. While most cities in emerg- learned may not yet offer a clear path for devel- ing economies boast high shares of public transit oping cities to follow. Certain foundational com- and active transport use, there are clear needs for ponents of MaaS—such as open data from mobility improvement in citizens’ ability to move about the providers and the adoption of new, integrated fare city. This is particularly true for low-income individ- collection technologies—have limited availability uals, women, and people with reduced mobility that in emerging economies. And while governments bear substantial costs and limitations to access their in Western Europe and North America have been places of work, education, or other key services (see willing to play a more proactive role advancing MaaS 104 MOBILITY AND TRANSPORT CONNECTIVITY SERIES through strategic investments, vision-setting, and to evolve. Other early government priorities should structuring of new regulations, regulatory frame- enable new MaaS businesses to coordinate with works and capacity is often lacking in developing public transit services, such as: countries. Lastly, for governments in emerging economies, the required investments of resources to i. the full digitalization of public transit data (i.e., develop a MaaS scheme may be more onerous and open, reliable, and complete route, schedule may compete with many other pressing needs. and vehicle location feeds from all public transit services) and Governments in emerging economies need to channel MaaS businesses towards strategic pol- ii. the development of multimodal fare payments icy goals. The search for control of bigger market systems that can incorporate new providers and shares and profits may naturally push ICT-enabled implement creative new products. mobility service providers towards multimodal portfolios that follow the MaaS paradigm. However, Governments could also dedicate funding to ensure if governments do not implement a clear policy the viability of MaaS businesses that pilot services vision and complementary regulations, competition specifically addressing equity of access, pollution, or among MaaS businesses may bring about many climate change. In the long-term, MaaS businesses of the negative consequences already seen from and government will only be properly aligned competition among public transit providers in through new regulatory frameworks that balance developing cities and may fail to serve the needs out and potentiate the shared goals and ambitions of users priced out or not covered by the for-profit for MaaS from both private and public actors (see services. Governments can start with clear visioning Chapter 6). that signals the market how they want the industry 105 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH References Bellon, Tina 2020. 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Center for Neighborhood Technology, November 21. https://www.cnt.org/blog/is-ridehailing-equitably-available-across-chicago. König, David, Jenni Eckhardt, Aki Aapaoja, Jana Sochor, and I. C. MariAnne Karlsson. 2016. Deliverable Nr 3 – Business and operator models for MaaS. Project Report, Mobility as a Service for Linking Europe (MAASiFiE) funded by CEDR [Conference of European Directors of Roads]. Kargas, Catherine, Marko Javornik, Marius Macku, Carme Fabregas, Filippo Logi, Jana Sochor, Josep Laborda, Elisa Falliti, James Datson, Piia Karjalainen, and Lidia Signore. 2019. Main challenges associated with MaaS & approaches for overcom- ing them: Study of MaaS Alliance governance & business models working group. MaaS Alliance, Brussels, Belgium. https://maas-alliance.eu/wp-content/uploads/sites/7/2019/02/Main-challenges-associated-with-MaaS.pdf Lucken, Emma, Karen Trapenberg Frick, and Susan Shaheen. 2019. “Three Ps in a MOD:” Role for mobility on demand (MOD) public-private partnerships in public transit provision. Research in Transportation Business & Management, 32: 100433. https://doi.org/10.1016/j.rtbm.2020.100433 Polydoropoulou, Amalia, Ioanna Pagoni, Athena Tsirimpa, Athena Roumboutsos, Maria Kamargianni, and Ioannis Tsouros. 2020. Prototype business models for Mobility-as-a-Service. Transportation Research Part A: Policy and Practice 131, 149–162. https://doi.org/10.1016/j.tra.2019.09.035 Roadzen.io. 2021. “The Real Cost of Owning a Car – EU”, June 23. https://roadzen.medium.com/ the-real-cost-of-owning-a-car-eu-efa814dde33a Schaller, Bruce. 2018. The New Automobility: Lyft, Uber and the Future of American Cities. Schaller Consulting, Brooklyn, NY. http://www.schallerconsult.com/rideservices/automobility.pdf SFCTA [San Francisco County Transportation Authority]. 2018. TNCs and Congestion. Final Report. SFCTA, San Francisco, CA. https://www.sfcta.org/projects/tncs-and-congestion Sochor, Jana, Helena Strömberg, and I. C. MariAnne Karlsson. 2015. Implementing Mobility as a Service: Challenges in integrating user, commercial, and societal perspectives. Transportation Research Record: Journal of the Transportation Research Board 2536, 1–9. https://doi.org/10.3141/2536-01c Westervelt, Eric. 2019. Ride-hailing revolution leaves some people with disabilities behind. NPR [National Public Radio], August 21. https://www.npr.org/2019/08/21/753034337/ride-hailing-revolution-leaves-some-people-with-disabilities-behind 106 MOBILITY AND TRANSPORT CONNECTIVITY SERIES 6. Governance 107 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH KEY TAKE-AWAYS FROM THE GOVERNANCE PERSPECTIVE • The public sector has faced a great challenge with the rapid rise of ICT-enabled mobility services. The public sector has almost been caught by surprise with the disruptive force of these services and has frequently been either too passive or too inter- ventionist in the regulation of ICT-enabled mobility services, often as a result of an outdated regulatory environment unwelcoming to innovation. • Regulations of MaaS should focus on desired outcomes and principles, rewarding positive impacts, and taxing nega- tive externalities. For MaaS to achieve the ambitious goals of improving mobility, accessibility, equity, and sustainability, it is important that governments prepare for and proactively shape mobility service and technology innovation through mode-agnos- tic regulations, space allocation, and pricing schemes that reward travel that is greener, more efficient, and inclusive. To achieve these goals, policies that disincentivize private car ownership and use are especially important for the success of MaaS. Financing and funding mechanisms must be made available as a result of these regulations. • Any MaaS governance and regulatory framework in devel- oping countries needs to address information, payment, and service integration, but also equity and climate consid- erations. The governance framework of MaaS can span from a hands-on format—where mobility providers connect to a government-run platform—to an open network of providers of transport, information, payments, and maps—where the govern- ment’s role is to coordinate rules and standards, nudging positive behaviors and curbing negative externalities. In either case, the arrangements and policies should not stop at a neutral integra- tion model; instead, they should explicitly embed societal goals through, for example, prioritization of investments, subsidies, and allocation of space to the most efficient and green modes. 108 MOBILITY AND TRANSPORT CONNECTIVITY SERIES • Data is the new regulatory currency in the MaaS governance framework. Managing this new paradigm will require the public sector to gain new skills, particularly around the development and use of technology. Data standardization, sharing, integration, storage, and privacy are all elements that the public sector must either facilitate through regulation or undertake to improve the success of MaaS. • A specialized agency will likely be necessary for MaaS to thrive. A MaaS agency, potentially evolving from an existing Metropolitan Transportation Authority (MTA), must have jurisdic- tion over all modes, with a focus on system and service integra- tion. Data analytics will be a key component of this new agency, which should be capable of assessing impacts on each part of the system and be empowered to innovate, conduct pilots, and propose regulations. MAIN OPPORTUNITY/CHALLENGE FROM THE GOVERNANCE PERSPECTIVE To take advantage of the full range of ICT-enabled mobility services in an integrated way, MaaS governance must be outcomes- and goals-oriented. MaaS governance must strike the right balance between pricing negative externalities and promoting innovation and new entrants to the market. This will require the public sector to act as a facilitator and will rely on the development of analytical capacity, flexibility to try new models, and persistence to reform the regulatory environment so as to provide a level playing field across all existing and new modes and services. 109 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH The public sector has not been able to keep governance and regulatory frameworks that bet- up with the fast pace of the digital mobility ter incorporate innovative mobility technologies revolution and has been reactively regulating and consider mobility systems from a multimodal ICT-enabled mobility services based on outdated perspective. Governments need to be strategic frameworks. Municipal public governments were and proactive in creating policies that leverage the startled by the arrival of ICT-enabled mobility ser- flexibility and innovation of the ICT-enabled mobility vices. At first, they simply observed and studied service providers to achieve MaaS goals. This chapter the operations and impacts of these services. As outlines the need for government action in shaping it became clear that ICT-enabled mobility services MaaS schemes; describes common challenges in brought with them negative externalities, cities terms of governance and regulation, equity, and began to focus new regulation on curbing these climate change mitigation that must be addressed by impacts, such as increases in vehicle-kilometers the public sector in developing MaaS; and provides traveled, competition with public transit, road safety common actions that can help governments over- risks, and unequal access for the bottom 40 percent come these challenges. (see Chapter 3. Demand). Moreover, an enormous political and administrative effort has emerged to understand the new business models and design new regulations for each ICT-enabled mobility ser- 6.1 The role of government vice. These ongoing efforts have been hampered by outdated regulatory frameworks that were made to For MaaS to achieve its ambitious goals in support a mobility-as-ownership rather than a mobil- improving mobility, accessibility, equity, and sus- ity-as-service paradigm. tainability, its implementation must be actively shaped by the public sector (rather than driven The concept of MaaS—a digital revolution by the goals of ICT-enabled mobility service that has a direct impact on how people move providers). For passengers, MaaS should improve in cities—brings an opportunity to reinvent and offer a seamless travel experience—with greater 110 MOBILITY AND TRANSPORT CONNECTIVITY SERIES availability, decreased travel times, and improved telecommunications capabilities, as well as new comfort—that is affordable and safe. Governments MaaS-oriented companies. For example, Chunghwa should pursue these user-centric mobility goals as Telecom (the largest telecom company in China) is well as broader, societal goals such as reducing pri- the main consortium partner in the UMAJI Taipei- vate vehicle ownership and use while increasing the Yilan MaaS pilot (Chang, Chen and Chen, 2019); Trafi use of low-carbon modes like public transit, walking (a mobility software company) is the company behind and cycling. This can help decrease congestion and the MaaS digital platform Jelbi in Berlin; and MaaS GHG emissions and improve the quality of public Global (a dedicated MaaS operator) is the MaaS pro- shared space. MaaS can be intentionally imple- vider of Whim in Helsinki. Although digital in nature, mented to provide transport to underserved popu- their services influence how people move and affect lations, such as low-income communities, women, the public space and infrastructure of cities. older adults, people with disabilities, or those that have physical, financial, and digital barriers to access- The public sector is best positioned to lead the ing urban mobility options. Finally, governments can stakeholder engagement and visioning necessary use MaaS frameworks to guarantee fair competition to push MaaS forward. In developed economies and foster innovation among mobility actors. These where MaaS has been piloted, lack of collaboration public sector goals contrast the goals of private among stakeholders has been an even greater mobility providers, which aim at increasing ridership barrier to MaaS than technology itself (Audouin on their own platform—an approach that does not and Finger, 2018). Some aspects that can obstruct automatically result in the most efficient and effec- cooperation are unaligned interests between private tive mobility system for society. mobility providers and the public sector, unclear expectations, clashes with existing regulations or 6.1.1 Proactive government leadership unwillingness to share data. For example, the initial in MaaS implementation refusal of Helsinki Metropolitan Transport Authority (HSL) to open its seasonal ticket for resale tempo- Given the intention to transform the ownership par- rarily hindered MaaS developments in the city. Its adigm into a service paradigm for mobility, govern- reluctance was linked to fears of losing the direct link ments must have an orchestrating role in MaaS. with its customers, not obtaining use data and seeing its brand fade away (Audouin and Finger, 2018). Despite the plethora of digital-based mobility providers currently operating, governments 6.1.2 Levels of public sector involvement in continue to be responsible for urban mobility ICT-enabled mobility services and MaaS planning to achieve societal goals. Actors in the mobility ecosystem now go well beyond transport Most policy and regulatory frameworks for urban operators, transportation authorities, and traditional mobility have been structured around public ticketing providers; they include the digital platforms transit management and the traditional car that match supply and demand, provide route infor- ownership paradigm. The immediate regulatory mation, plan trips, integrate payment and digital response to the rise of on-demand shared mobility ticketing platforms, map services providers, provide has typically been to limit their services to mitigate 111 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH their perceived negative impacts—including, ride- implementations of MaaS in Europe were accompa- sourcing’s unfair competition with taxi drivers (see, nied by different governance and regulation strat- for example, Box 4) and public transit. Frequently, egies, varying from hands-off interventions mainly initial reactive regulations tried to cap the number of focused on framing the overarching conditions for cars and scooters or entirely prohibit their services, market entry (if any), to hands-on interventions, which often resulted in an increase in unregulated which directly take the lead in MaaS implementa- transport while lengthy judicial disputes took place. tions. Some city governments have fostered MaaS For instance, Buenos Aires, Argentina, and Bogota, concessions with the aim to increase public transit Colombia, are still battling against ridesourcing pro- patronage or decrease public transit funding (e.g., viders while services have not stopped. In practice, Amsterdam or West Midlands), while others have services are running freely, and municipalities do implemented their own MaaS schemes to ensure that not currently have the regulatory tools to steer them public transit remains central to urban mobility (e.g., toward societal goals as a starting point for MaaS. Helsinki or Berlin) (Hirschhorn et al., 2019). More recently, some cities have restructured Between a hands-on and a hands-off strategy for their policy approach for ICT-enabled mobility MaaS implementation, governments might want services around data-driven regulations to nudge to focus on (i) data-sharing for better planning behavior. With evidence of both the positive and and behavioral nudging and (ii) developing an negative impacts of ICT-enabled mobility services open infrastructure for data and fare integration. (see Chapter 3. Demand), cities like São Paulo, New The public sector does not need to own and run a York, and Mexico City have implemented a second MaaS platform, but does need to develop infrastruc- wave of regulations based on data assembly and ture for analysis. For instance, taxing ridesourcing services in the city-center, incentivizing services in underserved i. data-sharing, which informs mobility and urban areas, or carrying out auctions of the curb space for planning, but also real time transit operations parking scooters. The data-currency has become and nudging mechanisms; and the core of this second wave of regulations, which a focus on outcomes rather than simply restricting ii. fare integration, through open loop payments ICT-enabled mobility service providers. By setting and account-based ticketing (see Chapter 4. basic safety and quality of service standards for oper- Technology), which allows subscription services ations as well as nudging positive behavior by taxing and subsidies to the bottom 40 percent. negative externalities, these policies offer a basis for a MaaS policy and regulatory framework that looks at Table 3 provides an overview of the advantages mobility holistically. and disadvantages of different levels of public sector involvement and strategies for MaaS The public sector can opt to pursue different implementation. levels of involvement in MaaS, according to needs, opportunities, and context. The early 112 MOBILITY AND TRANSPORT CONNECTIVITY SERIES Table 3. Advantages and disadvantages of the different MaaS implementation strategies Private MaaS Public MaaS Open-loop implementations implementations implementation Main advantages • Unleash the innovation • Best control and steer of • Promote public transit as potential. modal shifts that take place the anchor of MaaS, while as a result of MaaS. providing incentives to • Best exploit the related busi- attract ICT-enabled mobil- ness opportunities. • Best guarantee longevity ity service providers to of the scheme and spatial • Minimize the necessary pub- join in and leverage their coverage (Holmberg et al., lic spending. potential. 2016). • Allow private sector inno- • Promote public transit as the vations in providing one anchor of MaaS, while pro- or many MaaS platforms. viding incentives to attract ICT-enabled mobility service • Public funding for IT providers to join in and infrastructure, tech leverage their potential. development and human resources only for data platform and payment/ fare integration. Main disadvantages • Lower steering to ensure the • Require the largest amount • Requires a high level broader sustainability and of public funding for IT infra- of institutional capacity societal goals of MaaS. structure, tech development to coordinate an open and human resources. and distributed network • Can hamper inter organiza- toward MaaS goals. tional learning and invest- • Public actors tend to have ment decisions limited digital maturity. • Can be subject to the risk of monopolistic market developments and lead to continuous increases in user mobility prices and the cre- ation of “walled gardens.”24 Mitigation strategies • Careful design of the • Incentives that promote the regulatory and legislative public sector to innovate frameworks. • Incentives that promote the • Continuous monitoring of private sector to collaborate. MaaS-related developments. 24 Walled gardens are closed ecosystems in which the MaaS provider decides whether a third party enters their system. Even if open ecosystems bring more value, walled gardens can provide more profitable businesses during early developments. The pre-regulated American telecommunication sector from the 1970s offers an example of such a scenario. Back then, the telecommunications operator Bell System only allowed their owned telephone devices to be connected to their system. 113 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH 6.2 Governance and regulatory challenges To leverage the potential of MaaS, cities will need variability across urban markets and over time as the to address critical governance and regulatory services themselves and government response to barriers. In particular, governments in cities around them have matured. For example, while some cities the world will need to address issues such as: took early action to try to limit or prohibit services from operating (e.g., ridesourcing operations in i. undefined or conflicting responsibilities among Bogota, Buenos Aires, and London), others used government agencies and jurisdictions; minimum entry standards and data-driven oversight to shape their deployment and use (e.g., ridesourc- ii. lack of fair and stable regulatory frameworks for ing and scooter-share in São Paulo; see Box 18). ICT-enabled mobility service providers; Governments have also regulated the new markets iii. unclear data-sharing and data-privacy practices; that these mobility service providers create. For example, New York City established a minimum wage iv. deficient standardization and interoperability of per hour for drivers, others regulated trip fares, payment systems; and and others implemented systems similar to old taxi medallion models (e.g., for motorbikes in Manila). v. outdated procurement regulations that do not allow for piloting ICT-enabled mobility services. There are unresolved tensions between the need for data-sharing in MaaS schemes and both reg- Undefined responsibilities between government ulatory protections to personal data privacy and agencies and jurisdictions contribute to conflicts proprietary interests in business information. in governing the growing ICT-enabled mobility Data are the main connector in the MaaS network. ecosystem. The lack of integration among govern- Data allow not only the MaaS platform to integrate ment actors responsible for planning, operating, and operations and payments, but also the public sector overseeing transport and urban development is not to give the correct incentives to players to generate new; almost all transport agencies and institutions the desired outcomes. In operations, although fur- suffer from fragmentation, insulation and lack of ther interoperability standards are needed, public coordination—from overlapping national, state and transit and ICT-enabled mobility service providers municipal level jurisdictions, to agencies working in are beginning to create an open data infrastructure. silos in charge of a single mode of transport. There For example, they now share real time data such as is already a constant struggle to plan and govern bicycle/dock availability at each station or location, truly multimodal cities. MaaS adds complexity to location of idle car-sharing vehicles, and integrated the mix, including new layers of actors to the gov- ridesourcing and micro-mobility operations—all ernance ecosystem—the technology, telecom, and through application programming interfaces (APIs). payment providers. The most evident tension comes from government data requests to private ICT-enabled mobility service A lack of fair and stable regulatory frameworks providers. These requests often cover trips attri- for ICT-enabled mobility service providers leaves butes, such as number of trips and their origin and MaaS in a grey area. Regulations for ICT-enabled destination (location and time) driver attributes, such mobility services are still evolving, with significant as gender and age and characteristics of riders. First 114 MOBILITY AND TRANSPORT CONNECTIVITY SERIES and foremost, mobility providers fear that sharing discounted rides in underserved areas, pilot last-mile data might be leveraged later for operational restric- solutions with a set of subway stations. Governments tions. Second, mobility providers have concerns over may also want to be able to push out subsidies exposure of proprietary information and private data and incentives to customers, or integrate financial on riders and drivers. technology companies (fintechs) into a new model of online clearinghouse. However, current regulations Lack of regulations for standardized interop- are not suited for more shared risk profiles in pro- erable payment systems for public and private curement contracts, nor do they allow governments mobility providers is a critical barrier to MaaS and ICT-enabled mobility service providers to pivot implementation. Beyond trip planning and infor- quickly to different arrangements when they are not mation integration, payment and fare integration is achieving the desired outcomes. essential to offer users a seamless travel experience. Payment and fare integration also allows for dynamic fees and subsidies that can support a more equitable mobility system. Governments need to be able to 6.3 Equity challenges nudge behavior through micro-targeting fees and subsidies around the city, across modes, and for While addressing the governance and regulatory different times of day. The rigid, closed payment barriers discussed above will help MaaS meet systems typically in place are not well suited for a mobility goals, further government action is nec- MaaS system that aims to achieve equity and climate essary to align the MaaS framework with goals goals; they also curb competition, preventing smaller of equity and inclusion. A fully developed MaaS players to join in (see Chapter 4. Technology). Public system does not guarantee equity; clear provisions transit systems generally rely on closed validators; must be made for low-income users, those without any new payment method—for instance a credit card digital access, unbanked populations, and those with brand—needs to be approved and validated to enter mobility impairments. the system. The process is usually lengthy and is a barrier to new market entrants. ICT-enabled mobility services, such as ridesourc- ing, shared bikes, and scooters, can reinforce Outdated procurement regulations that cannot rather than mitigate unequal access to the city adjust to new business structures of ICT-enabled infrastructure if not properly located and priced mobility service providers make piloting MaaS with equity considerations in mind. For example, difficult. Typically, government procurement regula- bike-share vehicles and stations and e-scooter tions were designed to reflect the needs of big infra- deployment has been concentrated in wealthier structure investments, large IT systems deployments, neighborhoods and has only recently expanded and purchasing supplies. They were not thought to lower-income, less profitable areas (see Box 6). out with ICT-enabled mobility service providers in Studies tend to find that higher-income individuals mind (i.e., technology companies whose business are more frequent users of ridesourcing (Sikder, revolves around transportation). Many MaaS pilots 2019; Tirachini and del Río, 2019), although in some might require government agencies to procure at contexts there has been an increase in ridesourcing least a part of the MaaS services themselves—for use in low-income areas, such as in New York City instance, contract a micro-transit provider to provide (Atkinson-Palombo, Varone and Garrick, 2019). While 115 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH motorcycle ridesourcing is a more affordable way to likely than women (15%) to own smartphones (Silver, get around the city, many of these mobility services 2019). Even with increasing smartphone penetration, remain unaffordable for the bottom 40 percent many still lack quality mobile internet coverage. for regular use or as a first-/last-mile alternative While most people worldwide now live within range (Tirachini, 2019). of a mobile-cellular network signal, there are signif- icant gaps in access to LTE/WiMAX mobile networks The digital divide can exclude citizens from between the highest-income countries (around 97%) accessing MaaS. While smartphone penetration is and lower-income countries (around 38%) (ITU, 2020). increasing rapidly in lower-income countries, levels are still low when compared with higher-income The larger share of unbanked individuals in countries. For example, smartphone ownership in developing countries also makes the implemen- countries like India (25%), Kenya and Indonesia (40%), tation of MaaS more challenging. Financial inclu- the Philippines (55%), and Brazil and South Africa sion is on the rise globally but in 2017, an estimated (60%) are still much lower than ownership in the 1.7 billion adults remained unbanked, with most of United States and Australia (81%) and South Korea these individuals living in developing countries (WB, (95%) (Silver, 2019). There are also considerable 2018). While the percentage of adults with a bank gaps in smartphone penetration between older account is around 94% for high-income countries, and younger generations and, in some countries, it hovers at only 63% for lower-income countries between men and women. In Indonesia, those 34 and (WB, 2018). There are also persistent gender gaps in under are 53 percentage points more likely to have financial inclusion; globally, 72% of men have a bank a smartphone today than those ages 50 and older account while 65% of women do. Furthermore, as (Silver, 2019). In India, men (34%) are much more banking services are increasingly online, the digital 116 MOBILITY AND TRANSPORT CONNECTIVITY SERIES divide can exacerbate existing inequities in financial The implementation of MaaS will likely increase access. In high-income economies, 51% of adults competition for space at the curb, on the reported making at least one financial transaction in sidewalk, and on the road. The dynamic pace the past year using a mobile phone or the internet. of innovation in the provision of mobility services In contrast, in developing countries this number creates new pressures for the use of road, curb, and drops to 19% of adults (30% of bank account own- sidewalks (ITF, 2018). In particular, the rise of ICT- ers) (WB, 2018). Since ICT-enabled mobility services enabled mobility services is challenging traditional, largely depend on bank accounts or credit cards for static ways of managing the curb. In addition to bus payment and mobile internet connectivity to access stops, parking for private cars, and space for goods service interfaces, these issues present persistent delivery, curbs must now accommodate car-sharing challenges to the equitable implementation of MaaS vehicles, ridesourcing pick-up and drop-off points, (see Chapter 4. Technology). and the deployment and parking of docked or dock- less bikes and scooters. When it comes to sidewalks, Providing universal access for individuals with there are growing safety concerns for pedestrians as impaired mobility is also a challenge. For exam- users of bikes and scooters ride them on sidewalks ple, there are many individuals that cannot drive or and park them irresponsibly. When it comes to road operate vehicles, making ‘to rent’ mobility services space, MaaS could potentially reduce car ownership, like car-sharing, bike-sharing, and scooter-sharing but studies have also shown that it could increase the inaccessible. Among ‘to ride’ mobility services, the numbers of cars running with empty seats through- ridesourcing business model (with its supply of out the city (Schaller, 2017; Wenzel et al, 2019) and independent vehicles and drivers), has also struggled thus increase VMT (Henao and Marshall, 2019; to provide wheelchair-accessible vehicles for people Tirachini and Gomez-Lobo, 2019). Increased VMT with impaired mobility at the same level of service or could mean increased congestion if ridesourcing price as their service by regular vehicles. trips occur at peak periods, increasing competition for road use with other, more efficient modes. 6.4 Climate change Increasing rates of private car ownership and use in developing countries is a direct opponent of mitigation challenges MaaS. While motorization is low in most developing countries, it is rapidly increasing, especially in Latin America and Asia. The expected negative externali- MaaS implementation can play a role in climate ties of this growth are quite concerning, in terms of change mitigation, particular as a tool for plan- increasing inequality in access, road crashes, conges- ning mobility services around public transit and tion, pollution and reduced productivity (see Chapter for nudging individuals towards more sustainable 3. Demand). Without appropriate measures to curb travel choices. In order to make the most of MaaS the ownership and use of private cars, ridesourcing, for climate change mitigation, governments need to bike-sharing, and other operations within MaaS will address competition for public space and increasing remain niche transport services. rates of private car ownership and use. 117 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH 6.5 Overcoming barriers: Governance and regulatory framework for the MaaS city While there is no one-size-fits-all MaaS scheme, here managers and facilitators, focusing on the integra- we lay out how governments can better leverage tion of physical and digital infrastructure across a the flexible business models of ICT-enabled mobility variety of mobility providers (Goldsmith, 2019). This service providers to strengthen public transit and will also mean that transit agencies must continue achieve greater sustainability: to plan for long-term transit infrastructure projects while being ready to pilot smaller, quick-deployment i. Strengthening (or creating) a mobility-as-a-ser- projects to test and catalyze innovations in mobility vice agency and expanding capacity for manag- services. Further, agencies will need to plan across ing mobility innovation at all relevant levels of public and private sector participants from beyond government; the traditional transportation ecosystem, for instance fintechs and data companies. ii. Building a MaaS regulatory framework that encompasses all modes around a backbone pub- Potentially evolving from an existing lic transit system; Metropolitan Transportation Authority (MTA), a MaaS agency must have jurisdiction over iii. Financing and pricing an equitable MaaS system all modes, with a focus on system and service through incentives; integration. Creating or empowering an existing MTA to reduce silos and jurisdictional conflicts when iv. Proactively managing curbs, roads, and planning transportation projects with network-scale sidewalks; impacts is essential. Activities from different public agencies will need to be jointly managed and have v. Establishing data-sharing agreements; IT systems integrated into a MaaS agency, including: (i) mobility and urban planning, (ii) systems opera- vi. Establishing inter-operable payment systems; tions, and (iii) monitoring. A MaaS agency properly and equipped with open and interoperable systems that can actively incentivize travel behavior through vii. Supporting accessibility of MaaS for disadvan- subsides and fees will need public servants with new taged populations. skills. It will require the development of technology to share and receive real time data and information 6.5.1 Strengthening or creating a and to integrate public transit fare systems with new Mobility-as-a-Service agency fintech and private mobility actors. As the mobility space diversifies and becomes A city’s data analytics team will be a key compo- increasingly digital, governments will need a nent of new MaaS agencies. Many cities around the new institutional entity: a MaaS agency. While world have already implemented small and efficient transportation planners have traditionally consid- data analytics teams that use data to inform plan- ered themselves to be in the business of physical ning and project implementation. Examples include infrastructure provision, there is a growing need Boston’s Citywide Analytics Team, New York City for governments to position themselves as mobility Mayor’s Office of Data Analytics, Washington Lab@ 118 MOBILITY AND TRANSPORT CONNECTIVITY SERIES DC, UK Behavioural Insight Team (formerly the UK Finally, a MaaS agency will need freedom to Nudge Unit), Peru Minedu Lab, and Rio de Janeiro’s reimagine procurement regulations to allow test- NudgeRio. A few cities even have data analytics ing, piloting, and pivoting. For example, São José teams that specifically address mobility challenges, dos Campos, Brazil, has enacted an ‘innovation law’ such as São Paulo’s Mobilab. Almost all units start that allows testing and evaluation of pilot projects with a small team of two or three people, focused related to public works, especially by startups. This first on achieving quick wins. Integrating these skills law facilitates more flexible implementation of inno- and experiences into a MaaS agency will help it be vation in urban infrastructure and services. more ambitious, data-oriented, and open to inno- vation. It can also provide an important entry point for building capacity within resource-constrained governments (see Box 17). Box 17. Building capacity and laying the foundation for MaaS governance: The case of Sierra Leone’s Directorate of Science, Technology, and Innovation Policymakers may worry about whether their governments have sufficient institutional capacity—such as financial resources, trained staff in transport management and operation, and even robust urban transport policies—to engage with technological and digital innovations in the mobility service sector. While it is important to recognize the diversity of government capacities among developing countries, it should not prevent policymakers from innovating with urban mobility services. Where government capacity is relatively low, policymakers may want to focus on a few core activities, such as: articulating societal goals for sustainable mobility and coordinating among different actors to deliver innovation that align with those goals. And, where capacity is limited and it is difficult to have specialized skills in all ministries, city governments may consider creating a unit that promotes transversal innovation across economic sectors, including transport (e.g., New York City Mayor’s Office of Data Analytics or the UK Behavioural Insights Team). Sierra Leone is an encouraging case of how to foster innovation in a context of constrained gov- ernment capacity. In 2018, Sierra Leone established the Directorate of Science, Technology, and Innovation (DSTI), linked to the President office, to mainstream innovation and technology within the public sector. It works across ministries, civil society, and the private sector. It is staffed with a diverse group of thinkers, strategists, coders, analysts, and artists, including lawyers, sociologists, finance spe- cialists, designers, engineers, and data scientists. It is supported by an Inter-Governmental Advisory Board, composed of senior government officials, parliament, and the justice department who all serve as enablers of DSTI initiatives, and a Citizen’s Advisory Group that serves as a consultative community composed of members of the private and civil sectors. 119 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH The DSTI is an example of a government effort to integrate innovation within the public sector and develop technical capabilities within ministries. In particular, DSTI has worked with the Ministry of Transport and Aviation (MOTA) to develop initiatives to tackle the most pressing mobility issues in Freetown, giving digital innovation a strategic role in the design and implementation or urban mobil- ity. The urban transport sector in Freetown, Sierra Leone’s capital, is dominated by informal transit operators. Poda-podas (mini-buses) and commercial two and three-wheelers provide access to jobs where formal public transit is scarce, especially in the poorest areas of the city. However, quality of services is often low (with vehicles being poorly maintained and aggressively driven) and competition among fragmented operators contributes to congestion, pollution, and road safety issues. Because data on these informal public transit services is lacking, it is difficult to plan how they can be improved and integrated as part of a multimodal urban mobility system. Therefore, DSTI and MOTA have worked together to use mobile phone data to improve data collection and planning for these informal public transit providers. DSTI, MOTA, and the World Bank, worked with the DataCollaboratives Initiative and WhereIsMyTransport to create the first comprehensive map of the bus network—including routes run by publicly-operated buses (formal transit) and poda-podas (informal transit). A group of bright and motivated students from Fourah Bay College made this map- ping possible, using mobile phones to map routes and gather other information, such as fares and bus frequency. Additionally, Freetown is one of the most vulnerable cities in the world to climate change and natural disasters, especially flashfloods and landslide, which puts the urban transport system at further risk. The same group of students mapped the flooding of road infrastructure using Road Lab, gathering data about the state of existing drainage pipes and culverts. Then the World Bank partnered with the Ministry of Communications to make use of call data records to compare the different mobility patterns in dry and rainy seasons and identify which areas were the most impacted by rain. To fur- ther leverage the potential impact of the data collected, the World Bank, DSTI, MOTA, and SensiTech Innovation Hub collaborated to organize the first-ever Resilient Urban Mobility Hackathon in August 2019 to gather local ideas on how to solve urban mobility issues, while also helping to build an inno- vation ecosystem in the country. The winning submissions were a cashless payment system for public transit with adapted features for persons with disability; a platform for citizens to report road and drainage issues with great impact in flooding mitigation in Freetown; and a bus routing system with emergency response. In the context of a country with limited public sector capacity, where it is difficult to have specialized skills in all ministries, having the support of DSTI was critical in the deployment of data, technology, and digitalization in the urban mobility space. Setting up a single, specialized entity, like DSTI, to sup- port all ministries in mainstreaming innovation could be a cost-effective way to lay the foundation for future deployment of MaaS and support coordination and capacity-building among critical public and private actors. Where the governing bodies for the transport sector do not have human and financial resources to lead the deployment of MaaS, entities like DSTI could coordinate with academia and private providers to develop the technological, financial, and incentives systems to align innovation in urban mobility with societal goals. 120 MOBILITY AND TRANSPORT CONNECTIVITY SERIES 6.5.2 Building a MaaS regulatory framework regulate each mobility mode as it emerges). Only with this level playing field can ICT-enabled mobility that encompasses all modes service providers be efficiently leveraged by the pub- MaaS provides an opportunity for a more inte- lic sector to achieve broader goals of accessibility, grated, multimodal governance and regulatory equity, and sustainability. This framework should framework for mobility and urban planning that be performance- or outcome-oriented, establishing addresses key issues in current mode-specific minimum requirements for safety, quality of service, regulatory frameworks. While government actions and customer protection. These service regulations towards ICT-enabled mobility services has evolved should be coupled with rules for pricing externalities from reactive policies to consideration of more across modes to better align travel behavior with nuanced pricing and regulatory mechanisms, a more MaaS goals. sophisticated and comprehensive governance and regulatory frameworks is needed to support MaaS. Permits are a good instrument to define and Such a framework must be: enforce minimum standards to operate. In Mexico, Brazil, and Chile, national ridesourcing regu- i. thought out with ICT-enabled mobility service lation created a special driving license for drivers of providers in mind as part of an integrated ridesourcing vehicles. These licenses allow the flexi- network; bility that the job market requires, while guarantee- ing minimum levels of professionalism and safety by ii. include data-based regulations that use pricing requiring, for example, a basic criminal background (including fees and subsidies) to nudge behavior check. Other municipal regulations also set minimum towards desired outcomes, and while mitigating safety standards for ridesourcing vehicles, requiring negative externalities; and maximum age, airbags, and automatic braking sys- tems (e.g., Santiago, Mexico City, and Cape Town). iii. allow for innovation using open and interopera- Similarly, most scooter operators are only granted ble data-sharing and payments systems. permits if their vehicles have a certain speed limit. However, permits are not analogous to taxi medal- A MaaS governance and regulatory framework that lions and should not be used to limit a priori the integrates mobility services through data offers the number of vehicles (whether shared bikes, scooters, best opportunity to micro-target fees and subsidies cars, or vans). Caps on the number of vehicles do not to improve access to transport to the bottom 40 guarantee level of service and restrict the market percent, who are disproportionately dependent on to new providers, decreasing competition and inno- public transit. vation and opening space for more informality in service provision. Cities might reduce administrative and political costs and create a stable environment for MaaS The MaaS regulatory framework, which looks by creating a common regulatory framework at mobility holistically, should be applicable to that levels the playing field for ICT-enabled all transport modes and services. For instance, a mobility service providers (rather than trying to curbside regulatory approach should levy fees on 121 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH behaviors that are common to every form of trans- 6.5.3 Financing and pricing an equitable port (e.g., stopping to onboard or offload riders or MaaS scheme through incentives drivers). Every new mode of transport should share this pricing of curbside use with existing modes. MaaS will require alternative sources of financing Flexibly charging for the use of a valuable city asset to offer effective alternatives to the growing rate makes such an approach scalable to all foreseeable of low-occupancy travel and strengthen public future mobility services. This pricing approach can transit. MaaS financing to achieve societal goals and should be applied neutrally to both personal poses a difficult challenge for city officials. The chal- and shared forms of mobility. Fees may vary based lenge is to create a dynamic, virtual clearinghouse on the mode, the trip, and characteristics—such as that collects and distributes resources to reduce neg- vehicle occupancy, time of day, location, or other ative externalities and nudge behavior. It will require factors—but the pricing scheme would apply to all new skills, the intense use of technology, and, most modes, preventing ICT-enabled mobility service importantly, the right pricing of benefits and exter- providers from arguing that the fees are dispropor- nalities. Governments will need resources to steer tionately burdensome or unfair (Goldsmith, 2019). a MaaS scheme toward societal goals. For example, This approach can also ease tension involved in con- resources will be needed to versations with ICT-enabled mobility services, who would see a leveled playing field for negotiations. i. develop the public sector’s technological infra- For instance, Chicago and City Tech Collaborative are structure (systems for data and fare integration) piloting app-based curbside management pricing and capacity (skilled human resources); that tries to balance competing priorities (such as food deliveries, street parking, passenger pick-up ii. enhance infrastructure for public transit and and drop-off, loading zones, and public transit stops active modes; and priority lanes) based on time- and location-spe- cific use. While cities such as Paris, Copenhagen, and iii. provide discounted subscription services for the Zurich have correctly started to limit the space for bottom 40 percent; and parking (addressing the issue through supply), other cities such as Madrid introduced dynamic parking iv. subsidize first-/last-mile trips or service provision pricing (opting for a fee-based approach). In Madrid, in underserved areas and at underserved times the parking fee varies according to the type of vehi- of the day. cle—whether they emit more or less GHG—the dura- tion of parking, and if parking is in a low emission These alternative resources should come from new, zone in the city center. This system, implemented in multimodal pricing schemes such as curb use fees July 2014, creates financial incentives for drivers to or city-wide congestion charging within the MaaS park for shorter periods of time, mostly for pick-up scheme. and drop-off, and in areas and times of the day with lower traffic. 122 MOBILITY AND TRANSPORT CONNECTIVITY SERIES The task of pricing externalities evenly across all i. the spatial distribution of transport services (e.g., modes should be at the core of a MaaS scheme availability in underserved areas of the city versus to better align travel behavior to MaaS goals. wealthier areas); The MaaS regulatory framework must have clear ii. road use during peak and off-peak hours and in guidelines of how behavior will be priced. This will, certain areas of the city; in turn, inform the structure of fees and subsidies in the transport network. These fees should reflect the iii. curbside use and parking in high-demand loca- priorities given to public transit and active mobility in tions and times of the day; and MaaS schemes. Guidelines should address: iv. complementarity versus competition with public transit. Box 18. Smart regulation through pricing use: The example of São Paulo In 2016, in response to increasing pressure from ridesourcing companies, taxi drivers and the public, the city government of São Paulo approved a regulation to increase minimum requirements for safety, comfort, hygiene, and quality of vehicles and drivers of ridesourcing services and to charge a distance-based fee for the use of road space. The regulation was built on a policy mechanism that allowed city government to create pricing incen- tives for ridesourcing companies to deliver services that complement public transit and taxis. The policy mechanism was originally designed with higher distance-based fees for use in congested areas and peak-hour and to give discounts for persons with disabilities, female drivers, and trips in off-peak periods and in underserved areas. By combining the proposed regulation with real-time data and analytical capacity, São Paulo was moving in the direction of charging road infrastructure while maxi- mizing the social benefits of these services. The regulation was designed with the idea of leveling the playing field but encountered resistance from ridesourcing companies. The companies believed the fee should be applied to all road users, including private vehicles, which would incentivize a reduction in car ownership and use. Additionally, some companies strongly resisted data sharing requirements for accountability of the fees for fear that this data might be leveraged later for a cap on the number of vehicles or other operational restrictions. Instead of sharing data directly with the government, the largest player in São Paulo hired a specialized firm to provide audited data to the government. 123 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH São Paulo was a pioneer in designing a pricing mechanism to regulate ridesourcing services and has influenced other Latin American cities, like Mexico City. But the actual implementation of the mecha- nism is not making the most of the opportunities provided by the new regulation. Fees and discounts deviate little from the regular distance-based fee; therefore, the pricing structure has a negligible impact on nudging behavior. Further, as ridesourcing services account for a small percentage of road use in the city, an expansion of the pricing policies into a more comprehensive approach (including all types of vehicles and proportional to the negative externalities they produce), would be able to produce at-scale results. Although not being used to its fullest potential, the regulation has generated revenues for the city (around USD 30 million per year), which should be directed towards mobility infrastructure enhancements throughout the city. Sources: Alonso Ferreira et al. (2018); Darido, Alves and Targa (2016). While all mobility providers and modes should Congestion pricing is an effective tool to discourage be subject to a system of subsidies and fees that low-occupancy vehicles driving in the city center, par- induce the most sustainable, multimodal travel, ticularly during peak times. Current implementations pricing and other policies that disincentivize using automatic number plate recognition, such as private car ownership and use are especially in London and Stockholm, are based on entering important for the success of MaaS. Fees should be a charging zone. In its first year, London’s scheme imposed on activities in proportion to how efficiently reduced congestion by 30%, and more people are they use scarce public space or add negative exter- using active modes and public transit than ever nalities to those public spaces. Therefore, fees should before (C40 Cities Climate Leadership Group, 2019). penalize car use and high emissions to vehicle capac- Since its implementation in 2003, the congestion ity ratios, particularly in certain areas and times of charge has generated over £2 billion in revenue day. Fees should also disincentivize long-term use of (around £150 million per year), all of which has been valuable curb space in certain areas for parking and reinvested into London’s transport infrastructure instead facilitate greater turnover through onboard- and services, particularly public transit (C40 Cities ing and offloading. Conversely, financial incentives Climate Leadership Group, 2019). In Stockholm, since should be given to individuals and mobility operators its introduction in 2007, the congestion charge has that favor high-capacity vehicles. Additional subsi- reduced congestion and generated revenue, which dies, discounts, or exemptions may be warranted for is being partially invested in the expansion of the mobility providers that rebalance their fleet to reach city’s metro (Trafikverket, 2015). New mobile phone- traditionally underserved and low-income neighbor- based technologies could allow for dynamic pricing hoods and who provide services for first-/last-mile according to the type of vehicle (e.g., low and high trips to and from public transit. capacity or low and high fuel efficiency), time of day, and location in the city. This could pave the way for This means MaaS schemes will function best distance-based pricing rather than pricing by trip, when coupled with pricing tools such as conges- which can have perverse consequences for shorter tion charging, low-occupancy vehicle charges, trips by car. and dynamic pricing for curb and parking space. 124 MOBILITY AND TRANSPORT CONNECTIVITY SERIES 6.5.4 Managing curbs, roads, and sidewalks The emergence of ICT-enabled mobility ser- vices requires that cities take a more proactive MaaS schemes require integration of transport approach to curbside coordination and embrace infrastructure and services—including physical the curb as a valuable asset. Historically, cities have and operational connections among modes. paid little attention to curbs, which have been used Public transit stations and large commercial loca- primarily as space for parking that is usually free or tions provide critical nodes for MaaS infrastructure cheap. However, as the use of the curb for passenger integration. Allocation and management of parking and goods pick-up and drop-off has diversified, cities spaces at these critical locations as well as adjust- now need comprehensive curbside pricing schemes ments to fees and incentive structures can help that account for the number and type of vehicles encourage new modes to feed into public transit. using the curb, location, and time of day. These For instance, some airports in major cities have pricing schemes should prioritize transit and active replaced a portion of parking spaces for loading and modes as efficient and sustainable uses of urban unloading of shared-mobility passengers (e.g., Rio space. In fact, NACTO (2017) found that a metered de Janeiro, Boston, and Mumbai). This policy could parking space serves only 15 private cars a day, but be extended to public transit terminals and large that same curb space can serve 100 riders as a pas- commercial hubs. Many metro and train stations senger drop-off zone or 1,000 riders as a bus stop. have already implemented bicycle parking, but it is still insufficient for realizing the full potential of There are a number of practical examples of how integrating active modes with public transit. While to equitably manage the curb through financial bicycle parking is more space efficient then storing incentives and fees. Cities such as Portland, Oregon cars, high-capacity parking for bikes and scooters and São Paulo, Brazil use an auction system to can become expensive, particularly where the cost of allocate parking spaces for shared bikes, scooters, land is high. Expansive bike-sharing schemes (docked and cars. Other cities have passed new regulations or dockless) can be part of the MaaS scheme to that stipulate that bikes or scooters must be parked support the integration of cycling with public transit, in repurposed car spaces instead of on sidewalks to while reducing the need for parking space because reduce barriers for pedestrians (e.g., Paris, Beijing, of higher utilization of the shared vehicles. In India, and Santa Monica). When it comes to the equita- rickshaw startups have emerged that specifically ble distribution of ICT-enabled mobility services, target the first-/last-mile to public transit; New Delhi- Minneapolis passed new regulation to ensure that based Oye offers a fleet of electric rickshaws that scooters and bikes are distributed in underserved travel to and from metro stations only. Following areas and near transit stops. this trend, the Delhi metro has partnered with ETO Motors to pilot a fleet of e-rickshaws; dedicated The same technology that allowed for the emer- space for pick-up and drop-off and battery charging gence of ICT-enabled mobility services can be points are provided by Delhi Metro. used to manage the curb and sidewalks to ensure efficiency and safety. For example, improved 125 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH geofencing technology25 can be used to prevent To facilitate information exchange and mutual riders from parking scooters and bikes on sidewalks. learning, there is a need for clear and compre- Additionally, vehicle speed limits can be set accord- hensive policies and agreements that specify how ing to location and zones can be locked where it is to aggregate, store, and access certain types of forbidden (e.g., unsafe) to ride. data. These data sharing and use agreements must cover: (i) the definition of ownership of each dataset, 6.5.5 Establishing data-sharing agreements (ii) all permissions regarding which parties can use each dataset, and (iii) the purpose and projects that MaaS both relies on and enables multi-way data can use each dataset. These agreements can help sharing among all parties involved in the scheme. overcome concerns related to user privacy and pro- Recognizing that public and private providers have prietary business information. They can also protect different incentives and goals, they have a common interests in monetizing data. Data can either be purpose in sharing data with the MaaS platform: stored by public agencies, by third party data trusts offering a seamless riding experience for travelers. If (located at universities or think thanks), or by inde- public sector transport authorities and private sector pendent data aggregators. U.S. and European cities operators each provide real-time information on already hire independent data companies to aggre- the location of their vehicles to the MaaS platform, gate data and offer analytic tools for managing and then users can access information on all available planning bus systems. The World Bank Open Traffic mobility options in one interface. Governments and Partnership partnered with major ridesourcing and private sector operators can also both benefit from navigation services to combine and make public receiving data shared and collected by the MaaS their traffic data, providing Manila’s government and platform. Data on trips made and modes used allows the public with the latest, high-quality information government to integrate operations and evaluate to help with infrastructure and traffic management utilization, access, equity, proper parking locations, decisions. While examples of successful data-sharing and more in real time. Private operators may have arrangements exist (see Box 19), tensions between access to a larger pool of riders when they offer, governments and mobility providers remain a integrated mobility services. For instance, in some challenge. Here innovations in the Internet of cities in China, a passenger can book and pay for a Things (IoT) might help; MaaS may consider taking bus or train ride through DiDi’s ridesourcing app; in a “self-sovereign identity” approach where subjects the U.S., Uber partnered with mobile ticketing pro- own and control their own data instead of having it vider Masabi, to let riders book and use public transit stored and managed by a third party, and leverage tickets in their app. Private mobility providers may a decentralized blockchain technology to enhance also benefit from partnering with local governments privacy, control, and decentralization (Fedrechesk et in providing lower-cost, more-efficient public transit al., 2020). It is important to resolve regulatory pro- service to niche populations, such as paratransit. tections to personal data privacy so that government 25 A geofence is a virtual perimeter for a real-world geographic area. Shared bikes and scooter’s operators use geofencing to limit the areas where their services area allowed. 126 MOBILITY AND TRANSPORT CONNECTIVITY SERIES and mobility providers can openly discuss the fair protects sensitive personal information while still balance between protection of proprietary interests offering data granular enough to be useful for urban in business information and data sharing for mobility and transportation planners. planning. Additionally, it is critical to establish open inte- The data shared should be anonymized to pro- gration protocols for seamless trip planning, real tect sensitive personal information about drivers time operations, and incentives. To ensure data and users, while still being sufficiently granular adequacy, compatibility, and protection, it is crucial to provide insights to planners and providers. that the data is of high quality, standardized, interop- Location data should be treated as personally erable, and has clearly established security and own- identifiable information since, even when data is ership agreements to ensure privacy by design. The anonymized, an individual can be identified if his project Digital Matatus, in Nairobi, Kenya is a great or her exact location is cross-referenced with other example of the efforts required to ensure usability information. Therefore, data sharing policies should (see Box 12). A collaborative and inclusive data carefully consider the appropriate level of reporting gathering process generated the necessary trust in for location data. For example, ridesourcing reg- the community, resulting not only in an intense use ulations in São Paulo and Mexico City require trip by many international organization for planning pur- origins and destination latitudes and longitudes poses, but also use by many different private sector to be rounded to three decimal places (equivalent initiatives that developed routing apps. to approximately a 200m radius). This approach Box 19. Data sharing and data governance arrangements: The World Development Report and the example of Estonia’s X-Road system While traditional government sharing agreements have centered around open data, MaaS requires a new level of data sharing among governments, private sector mobility service providers, and other stakeholders in a manner that is standardized, interoperable, and secure. How can governments, private actors, and individuals be incentivized to partake in these sharing agreements and trust that their data will be protected? At the core of any MaaS platform, there is a need for real-time data sharing among stakeholders. Data is the main connector in the MaaS network, and therefore determining the optimal data governance and sharing schemes is critical for unlocking the full potential of MaaS. However, these kinds of data governance arrangements remain in their infancy. The legal and regulatory frameworks for data are often inadequate in developing countries, which all too often have gaps in critical safeguards as well as shortages of data-sharing measures. 127 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH Establishing appropriate data governance has several benefits that go beyond the application of MaaS, including new capabilities and opportunities to: (i) track performance and improve service delivery and customer experience; (ii) offer citizen engagement tools; (iii) engage the developer com- munity, resulting in the development of analysis tools, dashboards, and mobile phone apps; and (iv) improve the citizens perception of transport services as being modern, up-to-date, and high-tech. The 2021 World Development Report focused on these issues and provided the context for a new social contract around data—that is, an agreement among all participants in the process of creating, reusing, and sharing data that fosters trust that they will not be harmed from exchanging data and that the value created by data will accrue equitably. As an example of this the WDR highlighted the success of Estonia’s X-Road, a national data system. X-Road is an open-source data exchange layer that allows linked public and private databases to automatically share information, ensuring confidentiality, integrity, and interoperability between data exchange parties. It combines a technology (i.e., an enabling technical architecture and a series of protocols) with governance in the form of a ‘once-only principle’ enshrined in national law. Under this system, citizens have to supply government agencies and participating businesses with their information only once (avoiding duplicating requests). It is then automatically transmitted to other participating entities. X-Road’s cryptography protocols also enhance transparency because they log entries into the system and give individuals detailed insights into who is viewing their data and for what purposes. The X-Road arrangement builds on and enhances Estonia’s social contract on data by providing trust, equity, and value. Its transparency engenders trust. Its national scope, available to all, promotes equity. Its ease and comprehensiveness provide value. To work well, this digital data system depends on some “analogue” components. Cooperation is fostered between government and the private sector and between components of infrastructure. Change management is built into the entire system, from its foundations in national law (and the social contract) to its design, uptake, and upkeep. A culture of trust and data sharing is encouraged. Source: Adapted from The World Bank (2021). 128 MOBILITY AND TRANSPORT CONNECTIVITY SERIES 6.5.6 Establishing interoperable payments systems payment and unlocking of bicycles with a municipal transit card rather than a mobile phone. These cards The integration of payments system is key to the can be topped up by debit and credit cards, or, to success of MaaS. Integration of payment systems address the issue of the unbanked, by cash at local enables a seamless experience for users, but also markets and kiosks. In South East Asia and India, provides important infrastructure for furthering motorcycle- and car-based ridesourcing companies policy goals such as equity and climate change (e.g., GoJeck, Grab, and Yulu) also offer alternative mitigation. For example, by integrating payment payment methods that allow the unbanked pop- systems, agencies can offer subscription packages ulation to use their services, such as topping up a that incorporate subsidies for individuals in the balance in the app through cash payments to drivers, bottom 40 percent. Similarly, to encourage the use of recharging it in minimarts, or using SMS payment public transit rather than single-occupancy vehicles, services provided by telecom operators. Other integrated payment systems allow MaaS to offer companies sell pre-paid cards in local stores and extra options for first-/last-mile connections to tran- pharmacies that can be used for any of their mobility sit, increasing its coverage and encouraging greater services (e.g., Uber Cash). ridership. No matter whether governments opt to build their own MaaS platforms or integrate with a Complementary policies and programs are also platform developed by a private provider, having needed to enable populations with special needs an open loop, account-based ticketing system will to access ICT-enabled mobility services. There are allow service providers to see all mobility options in some examples of the public sector partnering with the system and combine them in win-win situations, ICT-enabled mobility services to provide on-demand, gaining access to a larger pool of riders (see Chapter door-to-door paratransit services. In Singapore, 4. Technology). mobility provider Grab partnered with healthcare institutions to offer an on-demand dedicated fleet of 6.5.7 Supporting accessibility of MaaS wheelchair-accessible vehicles. for disadvantaged populations Finally, incentives, tax credits, pilot programs, The public and private sectors must work and targeted discounts need to be established together to address access for those without to address affordability of ICT-enabled mobility mobile phones or banking systems. Without pro- services for the city’s lowest-income travelers. active action, existing inequities in access to digital Examples of targeted subsidies in transport can technologies will carry over to MaaS. Therefore, its be found in many cities and countries around the implementation should be accompanied by mea- world. Bogota, in Colombia, has a successful case sures that address the ‘digital divide’. For example, of targeted subsidy using the public transit smart- installing kiosks and screens—either stand-alone card. The program has shown to increase access to or in bus stops—could allow riders to access employment opportunities and improve individual’s Wi-Fi, maps, the MaaS provider’s trip planning and socioeconomic status. MaaS has the potential to payment application, emergency calling or other expand this kind of policy and to allow for dynamic features. Alternative ways of trip booking, such as testing of a range of different incentives, including through dial-in services, could also be supported. environmental incentives, such as the ones discussed For example, Medellin, Colombia and Fortaleza, in Chapter 3. Demand. Brazil have public bike-sharing programs that allow 129 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH References Alonso Ferreira, Marcela, Fernando Túlio Salva Rocha Franco, Ariela Giuli, and Fernando de Mello Franco. 2018. 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CC BY 2.0 Page 68: Chhor Sokunthea. World Bank Page 80: Melbourne Bike Share by Gavin Anderson. CC BY-SA 2.0 Page 88: Tokyo 3984 by tokyoform. CC BY-NC-ND 2.0 Page 94: Meeting Point by Ikhlasul Amal. CC BY-NC 2.0 Page 96: Green Minibus in Thonburi by Ian Fuller. CC BY-NC 2.0 Page 109: Y1A1181 Nairobi by Ninara. CC BY 2.0 Page 115: Mother & Son Crossing in Front of Rickshaw, Allahabad India by Adam Cohn. CC BY-NC-ND 2.0 133 ADAPTING MOBILITY-AS-A-SERVICE FOR DEVELOPING CITIES: A CONTEXT-SENSITIVE APPROACH