A few years ago, a new ‘vehicle-for-hire’ company emerged out of San Francisco – Uber. Unlike the traditional process for taxis where a customer has to stand on the street to hail a cab, give directions to unknowledgeable drivers, or fumble with unmanageable payment devices, Uber is for the tech-savvy. Customers hail a cab using an app on their smartphone rather than on the street. The Uber driver texts them when they are outside the door. GPS navigation is used to ensure the best and fastest route to the customer’s destination. Prearranged payment options allow customers to walk away from the vehicle without delay.
If one doesn’t think this model is working, Uber CEO Travis Kalanick announced in January 2015 that Uber revenues were $500 million per year in San Francisco compared to the local taxi market at about $140 million per year. In New York City, Uber transports on average 3.5 million customers a month in 2015. Compared to the yellow cabs which transported 14.4 million customers, Uber is still a small company with much to offer. This tech-savvy company is responsible for taking away 2.1 million fares from NYC yellow cabs. The threat is evident when the New York City Taxi and Limousine Commission launched a pilot program in 2015 to install GPS-based fare meters in 1,000 of its 13,500 taxi cabs.
Why the Focus on Technology?
The convenience and widespread usage of technology by the customer forces companies to look at leveraging technology wherever possible. Furthermore, equipment is cheaper. The NYC pilot will be replacing numerous pieces of equipment, such as the Taxi TV, credit card reader, vehicle location system and taximeter, with a single tablet or smartphone. The use of technology provides a platform to perform several processes more effectively and efficiently including, booking and monitoring.
For the customer, an application will serve three likely purposes:
- Easily find taxis in the areas
- Book trips in advance
- Compare fares from several taxi services
Similar applications will allow taxi operators to:
- Monitor location and status of individual taxis
- Respond to requests from customers in real time
- Identify location and destination of customers in real time and match with closest taxi
- Enable customers to track taxi arrival to pick-up location
Initial Concerns with Mobile Technology
The immediate concern for adopting any mobile technology is driver training. Drivers must be somewhat tech-savvy to use any deployed system effectively, particularly regarding security. An unprotected smartphone during a short taxi ride can easily give a hacker access to potential customer data and system controls.
Bring Your Own Device (BYOD) programs may provide a good start for initially moving into the technology. Drivers can use a phone or tablet they are already feel comfortable. However, security can be a bigger issue on these phones: first, because the average user tends not to invoke existing security mechanisms on their private devices, and second, the potential problems of co-mingling of personal and company use of the device and data. Driver training is still important with BYOD programs, as well as a technology strategy to partition company applications from personal applications on the device.
Another alternative is to provide a tablet or smartphone which is used as a kiosk for driver and customer. The device is only used for business purposes and may be limited in functionality to ensure better security. Driver and customer training are likely concerns with this solution.
Technology Future for Taxi Industry
The adoption of technology in the Taxi Industry will not slow down in the near future. Many transportation companies are becoming increasingly competitive around the world because of the technology-reliant business model. As companies begin using technology, they will fund the development of innovative and proprietary applications. In November 2015, Japan announced its supporting the development of thousands of Robot Taxis (driverless taxis) in preparation for the 2020 Tokyo Olympics. These cars are designed to perform trips no longer than 3 kilometers. Between now and 2020, look for applications that impact the customer booking experience and GPS-based monitoring systems for use by taxi operators and dispatchers. Many taxi companies are also going a similar route by offering ride sharing, allowing customers to catch a ride with already engaged vehicles taking the same route.
To maximize productivity, taxi companies are expected to enforce strong mobility policies by using advanced device lockdown features in their MDM solutions. This feature prevents drivers from using their devices in ways that do not assist in performance of their designated activities. For instance, drivers won’t be able to download and use unnecessary apps, engage in social networking activities or consume cellular data unproductively.
Management of mobile applications and devices is a concern of great importance. Managing access to specific applications for the driver will spearhead security concerns. Platform builds will be established to define device and security settings. Those settings will be accessible using admin passwords. Updates to settings and applications require management to ensure every device is updated in a timely manner. The use of web services and SMS options will play a role in maintaining communication with frequent and one-use customers. As independent technologies develop, such as GPS applications and transaction management applications, taxi companies will leverage and adopt into their current or planned mobile functionality.