The irresistible rise of MaaS Global
As the pioneer of Mobility as a Service, Sampo Hietanen has developed the concept from an abstract idea to a real service that represents the biggest challenge to individual car ownership.
While Detroit is the spiritual home of the motor car, and California’s Silicon Valley is the heartland of new technology, Helsinki can present a strong case for being the future of travel.
The Finnish capital is not only home to MaaS Global, the company which has framed the most compelling vision of Mobility as a Service (MaaS), but is also host to the most comprehensive MaaS system on the planet, via MaaS Global’s Whim app.
MaaS Global was only formed in 2015 and didn’t launch Whim until the following year, but the clarity and boldness of its ambition to provide a more efficient, more attractive alternative to individual car ownership has become a reference point for transport and fleet executives trying to work out how humans will get from A to B in the 21st century.
Competing with the car love affair
“Why do people spend 85% of their personal transport budget on a car, when they only use it for 29% of their travels?” asks Sampo Hietanen, chief executive and founder of MaaS Global. “The answer is not that they are unaware of the discrepancy. The answer is that they want to keep the dream alive. The dream of getting anywhere, anytime. It is about the idea of freedom. People pay to get around, but also for the possibility to get around even when they don’t.”
For MaaS to succeed it has to keep that same dream alive – “any time, anywhere on a whim.”
Over the last four years the development of MaaS as a concept has both exceeded and frustrated Hietanen’s expectations.
“There were some predictions that we could have gone further and got here faster, but on the other hand I’ve been in transport all my life and I would have actually expected it to take longer,” he said.
“The pace of development is hard to predict but the direction is pretty easy.”
Early adopters and latecomers
For every transport supplier ready to seize the opportunities presented by MaaS, there’s another, it seems, that’s slower to respond.
“I would have expected the transport providers that stand to gain most, public transport, to have moved fastest, but it really hasn’t been that way,” said Hietanen.
Instead, it’s taxis and rental firms that have led the way. The car hire sector is well accustomed to the role of aggregators as a source of business, while taxis have been swift to appreciate MaaS as a new sales channel as they deal with the threat of ride hailing disruptors.
Whim is not in the market to compete with existing transport suppliers, “but to combine them with other modes to compete against car ownership,” said Hietanen.
Building consumer confidence
It’s still too early to have conclusive proof that Whim customers are moving away from private car ownership in significant numbers, but Hietanen said there are signs that MaaS is initially a complement to car ownership before becoming a substitute once users have confidence in the service.
To build this confidence, MaaS Global is aggregating a one-stop-shop of sustainable transport, such as bikes, buses, trains and taxis, supplemented by rental and car share when public and shared transport cannot meet customer needs.
These users currently choose between two arrangements: a free, pay-as-you-go (PAYG) service, which allows users to plan a trip and buy their tickets via an app; and subscription packages that include unlimited public transport tickets alongside varying levels of access to taxis, car share and rental depending on the monthly fee. While PAYG customers naturally outnumber subscribers, it is subscribers who account for the lion’s share of Whim journeys.
MaaS for business
The exciting new development for MaaS Global is a business subscription for corporate travellers.
“We have been getting quite a lot of inbound calls from companies that want to complement, supplement or give an alternative to company cars,” said Hietanen. “Many younger people who are given a company car are not that keen on it; it’s expensive, it’s a lot of hassle for the company, and it has to appear on the balance sheet, so companies are looking to see if we have enough coverage. We are now doing the first business subscriptions. It’s a different field. You have to make sure the coverage is good; companies would like a nationwide or international roaming subscription. This is what we are aiming for, and to some extent we already have it.”
MaaS must be one of the few industries where suppliers seem reluctant to satisfy a burgeoning demand. While the situation may be improving, it’s still the case that some transport suppliers want to own this space rather than collaborate with MaaS specialists. So will the winners be aggregators or transport companies that try to bolt additional services to their core business?
Sampo Hietanen turns this question on its head by asking what the end user really wants. Do they want access to all modes of transport within their city or just some elements? Would they prefer a choice of supplier or just a single option? And would they like a subscription that roams nationally and even internationally, or are they happy with one that only works locally? While genuine MaaS aggregators can provide answers to the first half of these three questions, transport providers with a vested interest in one form of travel tend to cluster around the more local options.
Committed to MaaS as a competitive field rather than a state-sponsored solution, Hietanen wants the competition to intensify, “so we compete with other MaaS operators head-to-head using the same traffic infrastructure as our competitors, the same taxis, same buses, same trains, same cars and same bikes.”
Rivals, however, will have to act swiftly to catch up with MaaS Global. The company already has live operations in Helsinki, Antwerp in Belgium and Birmingham in the UK, and expects to cover 16 more areas by the end of this year in six to 10 countries, including Singapore and the USA.
“And next year, probably much more,” said Sampo Hietanen.