Wireless Applications

Logistics Deemed the Best Early Market for Traffic Information

August 8, 2006

ABI Research believes the commercial sector will offer the best initial opportunity for advanced real-time road-speed and traffic-flow data services.


OYSTER BAY, NY /BUSINESS WIRE/ -- ABI Research believes that the commercial sector, especially logistics operators and delivery fleets, will offer the best early market opportunity for the coming wave of advanced real-time traffic information services.

It has been widely assumed that the early market for real-time traffic services and advanced road-speed information will be navigation systems deployed in the consumer segment. Most existing navigation offerings use RDS-TMC as their backhaul and are inexpensive to customers. But more advanced services—including real-time road-speed and traffic-flow data—require connections with considerably greater bandwidth.

"Advanced real-time traffic information services must handle complex two-way data transfers, requiring much more bandwidth in both directions. It remains to be seen whether consumers will be willing to pay for that," says principal analyst Dan Benjamin.

But in the commercial sector, where time is money, the prospects seem more certain. "If the content providers, such as Navteq, Tele Atlas, Inrix, LandSonar, and Traffic.com, can deliver highly accurate road-speed and traffic-flow information, they will find a huge market in the commercial world," Benjamin believes.

If logistics companies such as Federal Express, United Parcel Service, and even local delivery services and taxi fleets can cut a few minutes off each trip, if they can do more intelligent route and schedule planning, and if they can reduce their fuel costs, they stand to save a great deal of money. Accurate real-time traffic-flow and road-speed information allow dispatchers to avoid costly delays as they develop. Even shaving off 10 minutes of driving per vehicle per day will deliver substantial financial returns.

"Granted," notes Benjamin, "there are integration issues to be resolved, and the traffic-data providers are going to have to deliver on their promise of high-quality information. But given that the logistics companies already have (and are paying for) advanced telematics systems, they should be ready to pay a premium for traffic information that will enable them to use their resources to the fullest."

ABI Research's "Real-Time Traffic Information" study evaluates the use of cellular, satellite, RDS-TMC, VICS, DSRC, and digital radio technologies for real-time traffic systems, as well as the use of embedded roadway sensors, acoustic sensors, video, radar, microwave, RFID, and DSRC for collection of traffic information. It identifies key market drivers and contains quantitative forecasts that cover North America, Europe, and the Asia-Pacific region. It forms part of the firm's Automotive Infotainment Research Service.

Founded in 1990 and headquartered in New York, ABI Research maintains global operations supporting annual research programs, intelligence services, and market reports in broadband and multimedia, RFID and M2M, wireless connectivity, mobile wireless, transportation, and emerging technologies. For information, visit the company's Web site or call 516-624-2500.


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