Business scenario
Increasing safety of road users, including drivers, vulnerable road users (VRUs), such as pedestrians and cyclists, is among the key focus areas of C-ITS services. In-vehicle warning services for drivers (such as motorcycle approaching indication, warning system for VRUs, emergency vehicle warning, slow or stationary traffic warning, road works warning) aim to alert the driver in the case of a potential adverse incident to enhance driver’s and other road network users’ safety. This bundle of services is particularly valuable when the driver is distracted, visibility is poor, or traffic density is high. In order to operate the service, data is collected on the speed and location of the driver through sources such as road-side units, vehicles, and VRUs. In case a potential incident is detected, the service emits a warning signal to the driver (or automatically takes control) to avoid an incident. In turn, this improves the safety of both the driver and other traffic users (e.g., pedestrians, cyclists, powered two-wheeler riders, and other VRUs).
Business model blueprint
In the business model blueprint depicted, the driver is offered a safe travelling experience via the safe driving bundle (in-vehicle warning services). The bundled service is offered by the service provider through an application either on a smartphone or on an on-board unit. When necessary, the application signals a warning to facilitate the car driver to react timely and adapt to the environment. As such, it enhances the awareness of the driver and improves his or her decision making. This leads to a safer and more comfortable travel experience, as potential accidents can be avoided.
The traffic operator (or in case integrated, the city/municipality) is responsible for generating and distributing traffic data, including those related to the behavior of other road users in the vicinity of the driver. This data is consequently integrated by the service provider to provide warning signage when needed. The traffic operator benefits from less accidents as awareness of the driver is increased. The software provider maintains the platform on which the service operates and receives a fee from the service provider.
Financing for the business model is supported through the joint efforts of the traffic operator and insurance companies, which distribute and promote the service over vehicle drivers in their insurance package. As the likelihood of an accident that involves vehicles equipped with the bundle is lesser, the insurance companies are less frequently required to pay out to compensate for incurred damages. Moreover, this may also lead to an improved corporate image, as the insurance company actively invests in social responsibility. Part of these retained profits consequently can be invested in ensuring that the service remains financially feasible in order to maintain these benefits. For the traffic operator, economic costs can be avoided as the likelihood of accidents is reduced. Part of these savings can contribute towards stimulating the viability of the business model blueprint.
Business model viability
Under moderate levels of adoption of the service solution, the business model design already produces (financially) viable results for the actors involved in the model. Reduction of road accidents, in particular fatalities, generate significant economic / monetary benefits for both the insurance companies and traffic operator, which offset the cost incurred with regards to financing the service deployment and operation (conducted by the service and software provider). Accordingly, stimulated use of the service (achieving a high penetration rate), enables all actors to generate a viable business scenario.
