The fee for the service would be significantly less than if the agency were to procure a similar system and deploy it. Consider that it is always less to pay a monthly cell phone bill than it is to build a nationwide cellular network! The software is centrally managed and with fewer unique software features to maintain, the service model allows the vendor to achieve economies of scale and hardware/software synergies, thereby allowing them to provide the service at a lower overall fee per user.
Lastly, if multiple local agencies have signed on to receive EFC, AVL or RTPI as a service, the use of the hosting environment enables inter-agency usage, sharing and interoperability. Data is centrally stored and managed so it is an easy technology leap to create multi-agency shared instances of the technologies. Now, a single smartcard can be used across multiple agencies and authorities. Intermodal or inter-agency real-time passenger information can be made available to the ridership. The transit ridership will also realize benefits from the technology service model.
Benefits of Service Strategy
From the above model, it is easy to see that transit agencies can realize a host of benefits from the service-based product offering, including:
• Lower total cost of ownership for cutting-edge technologies with constantly increasing feature sets
• Cutting-edge technology availability — any size agency can enjoy the benefits of a large-scale, feature-rich CAD/AVL, RTPI and EFC implementation.
• Greatly reduced IT management and maintenance requirements for the agency.
• Higher system level availability through the use of centrally hosted software and hardware resources; enterprise class disaster recovery sites and 24/7/365 hardware monitoring
• Quicker implementation of technologies through the use of standard software and feature mapping to transit agency needs.
• Easily introduce regional interoperability between agencies and the use of these technologies to provide value to the ridership.
While reading the example, we wondered why the firm didn’t go to a cellular provider, purchase the handsets, and provide each employee with a monthly cellular service plan. Instead of building its own cellular network, the firm could have accomplished the same thing quicker, cheaper and with more features. Thankfully, cellular providers like ATT, Verizon and Sprint do exist. If it is makes sense to go with a cellular provider, then why does the transit industry continue to purchase unique, custom-built solutions for AVL, RTPI and EFC systems? Transit authorities should be asking the vendors in the transit space who sell AVL, RTPI and EFC systems to offer their technologies as a service.
Vendors would host the technology and offer a complete range of advanced features to all subscribers for a monthly fee. Vendors would maintain the infrastructure and refresh the hardware during the life of the service contract. All on-going software development would be brought into to the core software, thereby offering an ever-increasing feature set to the subscriber agencies. Agencies would not have to provide a large staff for maintenance as the system is completely remotely hosted and monitored.
The overall total cost of ownership burden should be significantly reduced for these agencies over the life of the system’s use. Cloud computer and software as a service architecture are becoming more and more prevalent in our daily lives. Technologically speaking, there is no reason why vendors could not supply these technologies as a service to transit agencies. In this time of economic challenge, where cost awareness and procurement efficiencies are sharply in focus, this model introduces numerous benefits and advantages over the historical procurement strategies. Vendors exist to serve the needs of the agencies, and should offer this technology procurement to agencies just as agencies should push vendors to pursue this model and realize all of the inherent efficiencies that come along with it. Craig Daniels is a business development manager with VIX Technology USA and can be reached at email@example.com.