Sampo’s Blog: The Massive Opportunity of Living as a Service

By MaaS Global • July 2, 2020

By Sampo Hietanen, CEO and Founder of MaaS Global

Mobility as a Service is set to change how the world moves, but if we only focus on transportation, we may be missing the bigger picture. If Amazon had kept focusing solely on books, it would not have changed the world of retail. If Apple had kept pumping out great desktop computers, it would not have changed the way the world communicates. If Facebook had stayed the frat house it was in the beginning it would not have changed how the world advertises.

Now, MaaS Global is not trying to imitate the business models of these monopolistic companies. In mobility, monopolies are part of the problem, not the solution. I’m bringing these successful disruptors up because they teach us how we must keep our eyes open for major changes around us.

When disruption occurs, the greatest benefits don’t necessarily come from one sector alone, but from inventions that combine services from different fields. This I expect to be the case with mobility too. Mobility is a support structure for life, not an end. We have to get to work, to the supermarket, back to the family, out to get some exercise… Only adolescent boys think – or used to – that sitting in a car is the purpose of life.

The MaaS revolution is not driven by technology, but rather a change in values and lifestyles. Sustainability is becoming ubiquitous, experience economy is challenging the stuff economy and urbanization is a megatrend. To understand the future of mobility and the opportunity is to think what mobility connects to.

The biggest (and the most rigid) industries in the world, in addition to transportation, are real estate, health, food and energy. They are all changing, but a lot what we see is marginal. The big stuff is yet to come. All these sectors connect seamlessly to mobility: where you live is the starting point of it all, how and how much you move has direct consequences to your health, food is all about logistics and energy powers it all. Seeing transportation as a symbiotic activity with these sectors is a healthy strategic and business model check.

Let’s take a closer look at living. It’s the biggest consumer business of all and real estate is the biggest of all businesses. How MaaS can have a profound impact is best demonstrated by looking at one single parking space built at a suburban development. We recently studied a new development nearby with a friend and calculated that the overall cost of each spot had been about 50 000 euros. In Finland parking spaces don’t go for that price so it ends up camouflaged in the cost of the apartment or its maintenance or it’s paid through taxes.

What if we spent that money differently? With 50 000 euros you could get our Whim Unlimited package that satisfies all your mobility needs for more than eight years. And during all those eight plus years, you’d be saving the cost of owning and maintaining a private car, on the average 500 euros a month.

So, what if, at a new development you could use the space reserved for cars for housing or parks while saving the inhabitants a ton of money? Mobility would not be a separate issue and cost but it would come with the residence, as a service. The prerequisite is a MaaS infrastructure you can trust in: it must be fast, convenient and resilient, come strike, bankruptcy or pandemic. To develop that kind of infrastructure requires a scale that we have not seen – yet.

This is one of the possible futures we are exploring at MaaS Global. Last year we started a strategic partnership with one of the world’s premier real estate companies Mitsui Fudosan that is also a MaaS Global investor. Together we are exploring in the Greater Tokyo Area what it would mean if MaaS services were included in the rental agreement of an apartment.

In introducing MaaS there’s always the chicken and egg problem. Without a robust supply the demand does not develop and vice versa. With a strategic partner like Mitsui Fudosan this is not as much of a problem. The goal is to find new business models for urban development. If a model looks viable, an operator like Mitsui Fudosan has the muscle and the strategic capabilities to scale it from a few families to whole neighborhoods, of let’s say 500 000 people.

This can profoundly alter how new neighborhoods are built, but also where they are built. If, through MaaS solutions, the new development is not dependent on trunk lines, i.e. it does not have to be situated next to a railroad or a highway, this has a huge effect on the zoning possibilities and the real estate game.

As the MaaS market develops we will see plenty of mergers and acquisitions. Some of them will be driven by size in search of market positions and synergies. Some of them, and I believe this is what the winners will do, are driven by strategy: what are the larger lifestyle changes that are possible, desirable, sustainable, and offer fantastic business opportunities.