Massive social, economic and technology trends are converging to change mobility - how we move things from point A to point B, be they people, goods or containers. All of these drivers of change are self-reinforcing. We are at the start of a period of profound change: the ways by which we travel and move things will be very different from what exists in most of the world today. This is a revolution that will touch every corner of our lives.
What is future mobility?
Future mobility covers all modes of existing transport - and will create new ones. An increasing number of road vehicles - cars, trucks and buses - have greater autonomous capabilities and are moving towards the goal of driving us instead of us driving them. Electric autonomous vehicles transporting people or products around cities are seen as an important response to rising levels of urban pollution and traffic congestion. The race to innovate in this area is well under way.
Future mobility is not limited to road transport. Drones, which are currently used for inspection and surveillance tasks, will be able to transform industries like construction and retail by carrying heavy cargoes to inaccessible places. The revolution is also sweeping the railways sector; Rio Tinto announced that it will be rolling out the world’s first heavy freight driverless rail network in a remote desert region in Western Australia.
The factors driving change
Increasing urbanisation and the growth of mega-cities provides the conditions for change in mobility patterns and practices. The global demand for passenger mobility in urbanised areas is set to double by 2050.
Technology innovations in electrification, connectivity and autonomy are driving change. The pace of change will likely only increase, particularly because of the developments in AI, the Internet of Things (IoT) and developments in battery technologies.
Mobility as a service
The power of AI to algorithmically process larger amounts of data with growing efficiency is providing insights with which to create new services and business models, and make more efficient use of existing assets.
The increase in car-sharing and ride-hailing services, which already operate in many cities around the world, testifies to this. Enabled by smartphones and heavily backed by VC investment, these new business models are changing established patterns of mobility.
In line with other sectors of modern economies, the mobility sector is seeing a shift from ownership to access. Car manufacturers are investing in mobility services or partnering with ride-hailing firms in anticipation of a growth in shared economy models and further advances in automation. “The future of mobility is as a service,” says Johann Jungwirth, chief digital officer at Volkswagen Group.
Improving road safety
Safety is another key factor. According to the US National Highway Traffic Safety Administration, 94% of serious crashes are due to human error. More than 35,092 people died in motor vehicle-related crashes in the US in 2015. Across the EU there were approximately 26,000 road accident fatalities in 2016 - a figure which has stayed fairly constant for since 2013. Autonomous vehicles are predicted to greatly reduce this loss of life and cost to the economy.
“One goal with autonomous vehicles is to confront and diminish the toll of such deaths, with 1.25 million people killed on the world’s roads each year,” notes the World Economic Forum.
Environmental concerns, surrounding fuel consumption as well as air quality, are leading governments around the world to encourage the introduction of cleaner technologies and more efficient use of the transport infrastructure. Several European governments have announced future bans on sales of petrol and in particular diesel-powered cars, and their gradual replacement with alternative, zero-emission fuels - the Netherlands by 2030, Norway by 2035, and France and the UK by 2040. Auto manufacturers in China are obliged to ensure that at least eight per cent of their new-car sales are electric or plug-in hybrids and in 2020 that figure will rise to at least 12%.
Advances in battery technologies and the steady drop in the cost of lithium-ion batteries will further boost the wider adoption of EVs. In 2015, there were around 1.2 million electric vehicles worldwide. By 2040, there could be more than 300 million electric cars on the road. This could mean that “about 30% of passenger car kilometres could be powered by electricity”, according to a forecast by BP.
IoT technologies are increasing the ability to capture and share data - revolutionising services such as passenger information systems, smart traffic control and parking management systems.
Integration of transport services
Many cities and nations are looking to integrate new mobility modes (such as car-sharing and electric bikes) into urban areas and regulate parking capacity and usage. In cities, connected vehicles can send and receive signals from other vehicles, street lights, road sensors, and other devices to create a safer and better driving experience. When cars can drop off passengers and then make themselves available for other passengers, land currently occupied by car parking space can be repurposed. The efficiency of autonomous vehicles on highways, with their anticipatory and predictive capabilities which improve factors such as braking and acceleration efficiency, will increase road capacity resulting in less congestion.
Ambitious plans are being drawn up by governments. In Finland, for example, the Mobility-as-a-Service (MaaS) model aims to bring public and private service providers together - from travel planning and information, payments and the journey itself - to create a holistic urban transportation system that will deliver a service that can provide a reasonable alternative to personal vehicle use within a city. The Finnish Government’s Act on Transport Services has been developed to “establish the preconditions for the digitalisation of transport and enable a comprehensive overview of the transport system. The intention is to link different transport services, such as taxis and train journeys, into travel chains.”
The Dubai Autonomous Transport Strategy aims to transform 25% of the total transportation in Dubai to autonomous mode by 2030, involving five million daily trips and saving $6bn in annual economic costs. The Strategy aims to reduce traffic accidents and losses by 12% and increase the productivity of individuals by 13%. It will save 396 million hours annually on transportation trips and reduce the spaces allocated for parking.
A growing number of experiments
A growing number of experiments, conducted in real-world conditions, are taking place around the world. Different players are jostling to prove their technologies and be first to market.
The development of self-driving vehicles could lead to greater take-up of car sharing. According to the World Economic Forum projections, 42% of all self-driving cars (which could represent up to 8% of the total global car fleet) will be shared by 2030. By 2040, 53% of all self-driving cars will be shared.
The picture is a constantly evolving one. Every month, new initiatives are announced by the large technology companies and by the auto manufacturers. Waymo, the autonomous vehicle division of Google’s parent company, Alphabet, plans to launch the world’s first commercial driverless car service in early December, according to this report by Bloomberg. Volkswagen has announced a venture with hardware technology firm Mobileye, which is owned by Intel, to establish an autonomous ride-hailing electric vehicle service in Israel. Audi’s 2018 A8 model is the world’s first Level 3 autonomous driving car to go into production. The company is currently testing autonomous vehicles in China. GM plans to start a ride-hailing service with its Chevrolet Bolt in 2019; the vehicle will be fully autonomous, not having a steering wheel or pedals.
In public transport, the Swiss city of Sion has extended its pioneering driverless bus service, which to date has carried more than 60,000 people since its launch in 2015. The canton of Geneva has also announced plans to trial driverless buses. The French company EasyMile has deployed its EZ10 driverless electric shuttle bus at over 50 sites in 20 countries spread over Asia, North America, the Middle East and Europe.
Dubai’s Roads and Transport Authority (RTA) has held the first passenger tests of its self-flying taxi service, officially known as the Autonomous Air Taxi (AAT).
These developments are not without ethical, social and regulatory challenges.
The interplay between humans and autonomous systems throws up profound and difficult questions. In the event of an accident, who decides on the course of action to prevent (or minimise) deaths - the driver or the machine? Will autonomous cars be programmed to redistribute risk and thus endanger some people (such as a cyclist) more than others?
Even as they proliferate, drones face many regulatory hurdles in many jurisdictions - including their size, operator line of sight, the airworthiness of larger drones, security concerns and liability in the event of accidents.
The traditional division of roles in the mobility sector is being challenged today and could change dramatically in the future.
The automotive sector faces a future that is fundamentally different from its past. Electric vehicles (EVs) challenge the future of the internal combustion engine. The shared economy challenges the business model of individual product ownership. The greater use of connectivity and autonomy increases the demand for sensors and software, thus generating more data - which will be at the heart of these reshaped mobility ecosystems.
Data ownership and security
In this context, the issues surrounding data ownership and security are complex. Who owns the data that an autonomous car generates? It is estimated that the average connected car will produce four terabytes of data a day. Who is allowed to use it? To whom does it belong? Does it belong to the company that “generates” the data or should it be shared so it can be independently validated and used by other companies - which would both enhance security as well as lower the barriers to market entry.
Is the individual who owns a semi-autonomous car the owner of the data that it generates - as the vehicle is private property - or can, or should, the manufacturer have rights of access to this data? This in turn raises issues of personal data privacy.
There are also cyber security concerns. These are not just about hacked vehicles crashing but about data privacy in a world of increased ride-sharing and car-sharing, or the hacking of manufacturer-to-vehicle communications. As this Deloitte paper observes, “cyber risk poses perhaps the greatest threat to the future of mobility, and data governance, privacy, and protection will likely be of paramount importance.”
Patents and standards
The ICT industry is familiar with Standard Essential Patents (SEPs). These are patents which are considered to be essential for the implementation of a certain standard. The SEPs have to be licensed under Fair Reasonable and Non-Discriminatory (FRAND) terms - whoever owns the patent must license it on the same terms to all those who seek it.
With a history of fighting over ever-growing and evolving SEP portfolios and technical standards (just think of the development from 2G to 5G), this is familiar territory to the ICT giants.
It is new for the automotive industry, which has hitherto settled its IP disputes amicably behind closed doors and well away from the courts.
But such an approach reflects earlier times - when the car was a dumb, unconnected vehicle that was controlled only by its driver.
Yet the emerging generations of autonomous vehicle must be always connected, and capable of communication and interoperability with its immediate environment. In short, standardisation and SEPs are essential already and will play an ever-increasingly important role in the future.
Already, the first skirmishes in this battle are taking place. The chip manufacturer Broadcom has brought Audi and VW before the Mannheim District Court enforcing seven patents in a total sum of 13 individual actions. The patents relate to chips for wireless communication in a car.
So IP is at the heart of the future of mobility - and both the technology and the IP landscape are continuously evolving. Future mobility is bringing many different players into a new environment. How each of these players respond will have massive ramifications.
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