Innovatorrsquos Brief for the Transportation Industry Innovation News Made Simple for You

Issue 1 bull December 2012

Perspective on Innovation From Ken Mihalyov Chief Innovation Officer Transportation Central and Local Government Sector Xerox ServicesResearch Lab Director Xerox Research Center Webster

Welcome to the premier edition of our Innovatorrsquos Brief for the Transportation Industry We hope you enjoy this look into innovation and what wersquore doing in the transportation industry around the globe

In accepting the role of Chief Innovation Officer about three months ago I am following in the footsteps of those who initially made the connections between the transportation-related businesses of ACS and the Xerox research centers around the world when Xerox and ACS joined forces in early 2010 The goal early on was to build on the deep knowledge that ACS (now Xerox) has of the tolling commercial vehicle operations parking photo enforcement and public transit businesses by finding opportunities to apply our skills to the challenges of these businesses

Our knowledge base has led to the creation of multiple new capabilities such as dynamic pricing for parking management and tools for the more effective display and interpretation of public transit behavioral and operational data These capabilities help address key issues that are important to users of transportation systemsmdashthe reduction of congestion in cities and helping managers of transportation systems gain new insights to aid in decision-making These capabilities are both innovativemdashdelivering something new that has valuemdashand inventivemdashbacked by a growing number of patent applications We have a long-standing culture of innovation

At the core wersquore generating an intimate understanding of customer pain points and opportunities in order to guide innovation effortsmdashbecause itrsquos all about making a difference Wersquore gaining understanding not only from the expertise of our people but through ldquodreaming sessionsrdquo with our customers And where it makes sense we also go where innovation happensmdashworking with select universities and external organizations who work in fields of interest These interactions all enable innovative solutions to be both broadly applicable for a set of customers but also customizable to the specific needs of a particular customer

As more data is generated by transportation systems in the future innovation will be sought from an analysis of that data to find hidden gems of insight Examples are things like trends in traveler behavior quality of service and overall optimization of traffic flow Recognizing that people are involved in using and managing transportation systems wersquove found that a good complement to data analysis is the social science aspectmdashstudying how people do work and use technology We use this information to provide feedbackmdashimproving peoplersquos lives After all innovation only matters if it makes a difference to you We call it progress

Inside this Issue

Perspective on Innovation

Dynamic Pricing

Mileage Based User Fees

Transportation Innovation Infographic

page 1 of 2

Dynamic PricingAn opportunity to improve parking managementOn-street parking in large cities can be an expensive headache But what if you were offered a better trade-off between prices and the ease of finding a parking space

Most on-street parking meters offer a single static hourly rate regardless of traffic and parking utilization Static rates generally promote cruising for cheap parking increasing congestion and travel times The latest practice of installing sensors is being used in large cities to track the occupancy of each block face The purpose Xerox researchers have found that dynamically setting prices ensures that hourly meter rates will drive the duration a motorist parksmdashincreasing turnover and availability of parking

When we say that prices change dynamically we mean that a timetable of prices is fixed in advance and is changed every few weeks We arenrsquot talking about the sort of hard-to-predict minute-by-minute price changes that are common for air fares which would make driversrsquo lives even more complex

Wersquore simply talking about adjusting prices for a scarce resourcemdashdemand management Demand management helps better utilize existing space reduces ldquocruisingrdquo for cheaper rates and less traffic congestion to waste driverrsquos time Additionally as prices increase some drivers shift to public transit carpooling or cycling

While revenues and savings are important for dynamic pricing the primary metric critical to ensuring the success of demand management is customer satisfaction A customerrsquos most valuable resource will always be time We all have the same amount and we all want more Itrsquos a scarce and precious commodity and when wasted itrsquos gone forever

Contact UsXerox State amp Local Solutions Inc12410 Milestone Center DriveGermantown MD 20876wwwxeroxcomtransportation

copy2012 Xerox Corporation All Rights Reserved Xeroxreg and Xerox and Designreg are trademarks of Xerox Corporation in the United States andor other countries BR4330

Dynamic pricing allows for time-savings from the beginning of the driverrsquos journey No more guessing where your car will end upmdashthe pricing the value you place on a space and your time have already made that decision for you before you left the house

Mileage Based User FeesUse as you cruisemdashalternative funding to the fuel tax

Itrsquos a simple idea pay for what you use As fast as the highway system has grown cities have grown even faster Transportation routes too often result in our most modern problems congestion fuel waste and crumbling infrastructure And the greatest risk The need for more funding to build more infrastructure to continue to develop cities and highways alike

Today fuel taxes no longer cover the costs of maintaining existing highwayshellipthe fuel tax dollar just doesnrsquot go as far as it used to But whatrsquos the alternative

Leaders today see mileage based user fees playing a

role in future funding for surface transportation The concept is gaining more traction by the year Tying user fees directly to the miles driven by a vehicle matches a usage pricing model favored by many businesses Turn on a light you pay for the electricity you use Cell phone users pay for the number of minutes they talk Use as you cruise It seems a fair model for transportation and more often policymakers are already favoring the conceptmdashwe believe in it too

It sounds a bit like a crazy concept but the technology already exists to bring mileage based user fees to daily life In fact trials in several states (and other nations) prove that existing devices and systems can efficiently collect data on mileage use communicate the data to processing centers efficiently analyze and document the data then collect fees from users And since wersquore already doing it in other areas of our lives the concept isnrsquot too far off base

Our transportation analytics expertise and experience help customers in the sector make sense of data turn trends into revenues and keep consumers moving We pave the way for organizations to compete in toll road management and open-payment systems

We build sustainable modes of transportation analyze fare data manage parking space systems forecast the next new thingmdashand even think about who is going to pay for it and how can we keep the burden minimal

Some consumers and organizations worry the costs of implementing new technology and doing away with fuel tax legacy systems will be exorbitant Others believe a change will mean more money out of pocket than they pay with fuel taxes And youwhat do you think

Innovation in TransportationAn Evolutionary Guide

In our business therersquos a lot to be said about innovationmdashwhat wersquove been using for years without any thought had to start somewhere right And those items have become a foundational part of our lives Herersquos a look back at innovations in transportation that brought order and efficiency to our transportation system and the people and companies that applied them in a meaningful way

Dynamic pricing makes parking simple video

page 2 of 2

Innovatorrsquos Brief for the Transportation Industry Innovation News Made Simple for You

Dynamic PricingAn opportunity to improve parking managementOn-street parking in large cities can be an expensive headache But what if you were offered a better trade-off between prices and the ease of finding a parking space

Most on-street parking meters offer a single static hourly rate regardless of traffic and parking utilization Static rates generally promote cruising for cheap parking increasing congestion and travel times The latest practice of installing sensors is being used in large cities to track the occupancy of each block face The purpose Xerox researchers have found that dynamically setting prices ensures that hourly meter rates will drive the duration a motorist parksmdashincreasing turnover and availability of parking

When we say that prices change dynamically we mean that a timetable of prices is fixed in advance and is changed every few weeks We arenrsquot talking about the sort of hard-to-predict minute-by-minute price changes that are common for air fares which would make driversrsquo lives even more complex

Wersquore simply talking about adjusting prices for a scarce resourcemdashdemand management Demand management helps better utilize existing space reduces ldquocruisingrdquo for cheaper rates and less traffic congestion to waste driverrsquos time Additionally as prices increase some drivers shift to public transit carpooling or cycling

While revenues and savings are important for dynamic pricing the primary metric critical to ensuring the success of demand management is customer satisfaction A customerrsquos most valuable resource will always be time We all have the same amount and we all want more Itrsquos a scarce and precious commodity and when wasted itrsquos gone forever

Contact UsXerox State amp Local Solutions Inc12410 Milestone Center DriveGermantown MD 20876wwwxeroxcomtransportation

copy2012 Xerox Corporation All Rights Reserved Xeroxreg and Xerox and Designreg are trademarks of Xerox Corporation in the United States andor other countries BR4330

Dynamic pricing allows for time-savings from the beginning of the driverrsquos journey No more guessing where your car will end upmdashthe pricing the value you place on a space and your time have already made that decision for you before you left the house

Mileage Based User FeesUse as you cruisemdashalternative funding to the fuel tax

Itrsquos a simple idea pay for what you use As fast as the highway system has grown cities have grown even faster Transportation routes too often result in our most modern problems congestion fuel waste and crumbling infrastructure And the greatest risk The need for more funding to build more infrastructure to continue to develop cities and highways alike

Today fuel taxes no longer cover the costs of maintaining existing highwayshellipthe fuel tax dollar just doesnrsquot go as far as it used to But whatrsquos the alternative

Leaders today see mileage based user fees playing a

role in future funding for surface transportation The concept is gaining more traction by the year Tying user fees directly to the miles driven by a vehicle matches a usage pricing model favored by many businesses Turn on a light you pay for the electricity you use Cell phone users pay for the number of minutes they talk Use as you cruise It seems a fair model for transportation and more often policymakers are already favoring the conceptmdashwe believe in it too

It sounds a bit like a crazy concept but the technology already exists to bring mileage based user fees to daily life In fact trials in several states (and other nations) prove that existing devices and systems can efficiently collect data on mileage use communicate the data to processing centers efficiently analyze and document the data then collect fees from users And since wersquore already doing it in other areas of our lives the concept isnrsquot too far off base

Our transportation analytics expertise and experience help customers in the sector make sense of data turn trends into revenues and keep consumers moving We pave the way for organizations to compete in toll road management and open-payment systems

We build sustainable modes of transportation analyze fare data manage parking space systems forecast the next new thingmdashand even think about who is going to pay for it and how can we keep the burden minimal

Some consumers and organizations worry the costs of implementing new technology and doing away with fuel tax legacy systems will be exorbitant Others believe a change will mean more money out of pocket than they pay with fuel taxes And youwhat do you think

Innovation in TransportationAn Evolutionary Guide

In our business therersquos a lot to be said about innovationmdashwhat wersquove been using for years without any thought had to start somewhere right And those items have become a foundational part of our lives Herersquos a look back at innovations in transportation that brought order and efficiency to our transportation system and the people and companies that applied them in a meaningful way

Dynamic pricing makes parking simple video

page 2 of 2

Innovatorrsquos Brief for the Transportation Industry Innovation News Made Simple for You