Bacon's Rebellion

James A. Bacon


 
 

Awesome!

Demand-Side Economics

 

The government remedy for traffic congestion is to increase supply by building more roads. Craig Franklin's solution is to use real-time traffic data to manage demand.


 

The Conventional Wisdom says the Common-

wealth faces shortfalls in transportation funding over the next 20 years amounting to tens of billions of dollars. Without new sources of revenue, Virginians will endure a dystopic future of overloaded highways, chronic traffic congestion, lost productivity and grueling, high-stress commutes. But, then, the Conventional Wisdom never reckoned on Craig Franklin or the extraordinary creativity of free markets.

 

Franklin, CEO of Leesburg-based Trichord Incorporated, is bringing the information technology revolution to Virginia’s roads and highways, a realm not normally known for a frantic pace of innovation. He modestly refers to himself as a “value added reseller” of the SAS-1 traffic sensor manufactured by another Northern Virginia company, SmarTek Systems in Woodbridge. SAS-1, says Franklin, provides state-of-the-art accoustic technology to calculate the number and speed of vehicles in multiple lanes of traffic. Franklin powers these sensors with solar collectors and hitches them to wireless technology to transmit real-time traffic data to his servers.

 

The integration of technologies is cool. But what's truly revolutionary is what Franklin does with the information. In years past, traffic data has sat in data vaults accessible only to the Virginia Department of Transportation. But Franklin is pumping it out to businesses and commuters, who can use it to make better-informed decisions on where and when to drive. He can deliver real-time traffic data over the Internet -- see WTOP TV's traffic feature -- or to your cell phone. He can tell commuters how long it will take them to drive down Interstate 95. He can alert corporate fleet managers when congestion is clogging up traffic along key routes.

 

Trichord's information services are to VDOT's primitive roadside traffic signs what Interstate highways are to dirt roads. By putting detailed and actionable information into the hands of thousands of Virginia commuters before they hop into their cars and commit themselves to particular routes at particular times, Craig Franklin represents the vanguard of a movement that will empower motorists and businesses to reshape the demand for highway transportation. Inevitably, planners will have to re-think policies predicated on the notion that the thirst for mobility can be addressed only by adding more supply -- more roads, more buses, more mass transit, all requiring billions of dollars of more taxes.

 

Change won't come overnight. At present, Franklin is collecting information only along Northern Virginia's Interstates; his service does not cover dozens of other vital arteries such as U.S. 29, U.S. 28, U.S. 50 or the Fairfax County Parkway -- and it isn't yet clear whether commuters will pay for Interstate data without also knowing what's happening on alternative routes. Also, like state government, Trichord is constrained by finances. The pace at which Franklin can install sensors on more routes is limited by his ability to generate cash from existing investments. But there are competitors close on his heels. If he can't make it happen, someone else will. 

 

The underlying idea is not new. The federal government has been researching "Intelligent Transportation Systems" for 15 years or more, funding dozens of test projects around the country. But the feds have been unable to move beyond small-scale studies. Meanwhile, VDOT has installed dozens of its own sensors along Interstates and feeds it back to the public through programmable, roadside signs. The system, advanced though it may be by the standards of state transportation departments, is primitive compared to the technology that is readily available. "Warning, Congestion Ahead in Five Miles" does not give a driver much information to go on. Franklin is the first person to figure out how to make a business out of collecting traffic data and putting it into the hands of people when they can use it to alter the timing and route of their trips -- and the first to figure out how to pay for the information.

 

A computer engineer by training, Franklin moved to the Washington metro area in the late 1980s to work for a government contractor on a ballistic missile defense project. In 1992, he switched lanes into transportation project, delving into work on intelligent vehicle highway systems. In 2000, he launched Trichord with the help of some outside investors.

 

Trichord provided a range of services at first, selling consulting services and acting as a value-added reseller of traffic sensors. In February 2002, his board made a vital decision: Focus on selling data. Says Franklin: "Our primary role now is as a wholesaler of real-time traffic data."

 

Trichord negotiated a deal with VDOT, allowing it to deploy its own sensors along Virginia interstates in locations where VDOT didn't already have them, and to share data with the transportation agency. Since then, Franklin says, five other companies have either sought or entered into similar agreements, although, to his knowledge, no other private company has yet installed its own sensors on VDOT right of way.

 

Now Trichord is developing channels to re-sell the data. It has closed deals with WTOP, a Washington-area television station that provides extensive traffic and commuting coverage. It has contracted with RatRace USA to deliver data to subscribers' cell phones, and it retails its own Jamtracker product aimed at fleet managers. Long-term, says Franklin, he hopes to deploy sensors along the Interstate in Hampton Roads and Richmond, and then along other major arterials. He'll also move into Maryland when he can close a deal with the Maryland transportation department.

 

Franklin doesn't oversell his technology -- he doesn't pretend that it's some silver bullet that can save Virginia from the scourge of traffic congestion. But he does contend that providing real-time traffic data can affect demand. Acting on the information he supplies them, some people will start their commutes earlier or later in the day than they normally would, spreading demand for road access over time. Some people will plot alternate routes, redistributing demand from overloaded arteries to to less congested byways. Finally, some will put their car keys in their pockets and take the bus or Metro. Perhaps most important of all people will use the information to take much of the guesswork, uncertainty and stress out of commuting.

 

Fortuitously, the revolution in Intelligent Transportation Systems coincides with a major rethinking in Virginia policy circles on how to cope with traffic congestion. Since the defeat last year of the sales tax-increase referenda, designed to raise money for massive new highway and transit construction, transportation lobbies have shifted tactics. Now, in Northern Virginia at least, they're touting the idea of converting HOV lanes to HOT lanes. These High Occupancy Toll lanes are not limited to carpoolers -- a declining species on Virginia's highways -- but can be used by anyone willing to pay the extra charge.

 

Contrary to the characterization of critics, HOT lanes aren't just for Yuppies in Beamers too spoiled to slog it out in the slow lanes. HOT lanes create a fast-track alternative for any driver in a time pinch, whether they're running late to the office, a business appointment or day care.

 

The drawback of HOT lanes is not that they are "unfair," but that they require drivers to possess more information about traffic conditions than they currently have. If a driver encounters traffic congestion after he's passed the HOT lane entrance, the toll alternative does him no good. But if drivers subscribe to Trichord's data services -- RatRace USA costs $9 per month -- they know ahead of time how much delay they will encounter. They can weigh the savings in time against the cost of the toll before getting into the car.

 

Delivering real-time traffic data to motorists will help them take full advantage of the transportation options that HOT lanes will provide them. Real-time data combined with HOT lanes represents a win-win scenario for everyone. Motorists enjoy more alternatives, thus more control, over their commutes, while the state collects tolls, paying for the conversion from HOVs to HOTs and perhaps even raising enough money to fund other transportation projects.

 

While Trichord has an undisputed coolness factor working for it, it's not the only Intelligent Transportation System game in town. A key vendor, SmarTek Systems, manufactures accoustic sensors that can be deployed in a traffic corridor to monitor traffic conditions and coordinate traffic signals. Typically, cars engage in stop-and-go driving, rushing from one stoplight to the next. Smart transportation systems would expedite "platooning," or the movement of large cohorts of cars at high speeds through sequenced stoplights. "If you have detection in advance of the stoplights, you can adjust the timing and extend the green light," explains Greg Peiper, a SmarTek v.p.

 

At a cost of roughly $100,000 to rig a major intersection with sensors, overheard beams and communications boxes, a major transportation corridor with 50 stoplights could be outfitted for around $5 million. Coordinating the works might cost a couple of million more. (Arlington County recently hooked up 65 intersections to an "adaptive signal control" system for $2.4 million.) Now, do the math. What makes more sense -- use sensors and signal controls to squeeze an extra 10 percent to 20 percent capacity out of a transportation corridor for $7 million, or add an extra two lanes (one each way) at the cost of tens of millions of dollars per mile?

 

Achieving incremental gains by tweaking traffic light signals, the rate of flow on Interstate on-ramps and other such micro-projects doesn't make a statement of "Your Tax Dollars at Work" as bold as a construction crew laying a carpet of steaming asphalt. But it may be vastly more economical in urban environments where the cost of acquiring right of way and widening roads can be prodigious.

 

The advantages of Intelligent Transportation Systems seem so obvious I can't understand why the Warner administration hasn't elevated it to a top priority -- or why Republican legislators aren't pushing the executive branch to move more aggressively. Fearing that I might be overlooking something, I checked in with Philip Shucet, the Commonwealth Transportation Commissioner, for a reality check.

 

Collecting and disseminating real-time traffic data is part of the transportation solution, Shucet says. "I don't believe we've finished building our infrastructure yet. But realizing the enormous cost and environmental impact associated with the infrastructure, it's only prudent to look at traffic demand management. And technology is part of that."

 

Real-time traffic data would work best where there are alternatives to driving, such as buses and light rail, Shucet says. If Virginians don't do a good job of providing those alternatives -- and they do cost money -- "the situation isn't likely to change much."

 

But the commissioner conceded that real-time information might well make HOT lanes work more effectively. A public-private partnership has put a HOT lane proposal on the table in Northern Virginia. If information technology could bolster the financial returns on that project, he suggested, it might inspire similar proposals elsewhere in the state. Combining real-time traffic info with increased private investment in transportation projects could make a big impact.

 

Likewise, Shucet sees potential to use sensors and real-time data to push more cars through existing transportation corridors. Traditionally, VDOT has focused attention on road and highway construction. Perhaps it's time to put more emphasis on operational efficiency as well, he says. "We've got to think about how our organization is going to change and adapt" to achieve operational excellence.

 

Given the magnitude of the transportation problems Virginia faces, sensors, signals and HOT lanes by themselves won't keep up with ever-increasing traffic counts. In the long run, Virginia must address the increasingly scattered, low-density pattern of development that forces people to take longer and more frequent car trips to get anywhere. But reforming the way we design and build our communities and transportation systems requires fundamental reforms to governmental structures that have no prospect of taking place any time soon.

 

At the same time, Virginia voters have demonstrated repeatedly that they are in no mood for tax increases. Unable to raise taxes and unwilling to reform Virginia's dysfunctional pattern of development, policy makers have few alternatives. Either they aggressively explore ways to apply state-of-the-art sensor and signaling technologies, in conjunction with market mechanisms like HOT lanes, or they consign the rest of us to a lifetime of ever longer, teeth-grinding commutes.

 

-- October 20, 2003

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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You can berate Bacon at jabacon@

baconsrebellion.com

 

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