London, United Kingdom - 28 Feb 2019

The number of public transit tickets delivered to a mobile device will grow from just over 4.5 billion in 2018 to 7.9 billion in 2023, forecasted ABI Research , a market-foresight advisory firm providing strategic guidance on the most compelling transformative technologies. This growth will be driven by both increasing consumer use and an increasing understanding by Public Transport Authorities (PTAs) that mobile will play a critical role in future-proofing business models as well as be the launch pad from which to diversify and place themselves in a central role in order to take advantage of the Mobility-as-a-Service (MaaS) opportunity.

Multi-modal transportation, MaaS, and Mobility on Demand (MoD) are now considered more critical in order to offer a seamless commuter experience alongside the rise of use cases including ride-hailing, e-scooters, and bike sharing. This is clearly where the public transit market needs to head, embracing the convergence between publicly and privately-owned transportation modes.

PTAs are perfectly positioned to leverage and recycle vast data mines related to their commuter bases, encompassing location, preference data, and payment information. Through these analytics, this information becomes a monetizable asset to which PTAs could allow other transportation vendors to plug into as part of a wider MaaS solution.

PTAs now need to embrace this paradigm shift, in order to place themselves at the center of the MaaS opportunity via the creation of centralized mobility platforms/applications, where multiple transportation services, whether PTA or privately managed and owned, can be consumed from a singular mobile device. Mobile ticketing enablement is the PTAs first step toward realizing this emerging opportunity.

“Today, OEMs (Original Equipment Manufacturers) including Samsung, Apple, and Google are leading the early mobile ticketing charge, leveraging open-loop payment platforms and reapplying to offer closed-loop ticketing support,” commented Phil Sealy, Principal Analyst at ABI Research. “These OEMs all have established mobile payment applications and PTAs are able to leverage these to take advantage of their already existing scale." ABI Research believes that partnerships between PTA and OEMs should be encouraged to not only ensure new levels of scalability but also to ultimately serve as a platform for PTAs to launch new services and eventually enter the MaaS market. For this reason, PTAs should not resist the advances of OEMs.

“It’s now ‘Do or Die’ for the PTAs; they need to embrace the paradigm shift toward MaaS. The first stepping stone is to launch a dedicated mobile ticketing platform/application. PTAs have the required pre-existing commuter base and with a mindset of service and partnership extension, could place themselves as the primary MaaS application provider. However, if PTAs do not begin to strategize and move toward MaaS, through platforms offering access to open APIs to MaaS aggregators like MaaS Global, others will come over the top and sweep the opportunity from beneath the PTAs feet. However, this will require a complete strategy rethink since current PTAs strategies are very much closed in nature, looking to maintain full control and/or become MaaS aggregators themselves. This closed mindset will inevitably widen the door to those vendors already leading the charge toward public transit displacement, such as Uber, which already has had a massive impact in London by taking control of previously profitable TfL (Transport for London) routes, and Lime from a scooter perspective,” concluded Sealy.

These findings are from ABI Research’s The Path to Mobile Ticketing technology analysis report. This report is part of the company’s Digital Security research service, which includes research, data, and analyst insights. Based on extensive primary interviews, Technology Analysis reports present in-depth analysis of key market trends and factors for a specific technology.