Unlike the United States, China has never been a nation on wheels—until very recently. So, when China overtook the United States in car sales in 2009, the country’s transportation and intelligent transportation system (ITS) infrastructure was not yet ready.
Roads in many Chinese cities are narrow and there are few freeways even in mega-cities like Beijing and Shanghai. Traffic congestion, therefore, has become a daily nightmare for Chinese drivers in large urban areas.
High Traffic Now, More Traffic Later
Speaking at the 17th ITS World Congress in Busan, South Korea in October, the chief officer of ITS China at China’s Ministry of Science and Technology said China now has 199 million registered vehicles and more than 200 million registered drivers. Car ownership is expected to rise at a double-digit rate during the next 10 to 15 years.
These gigantic volumes generate problems, such as accidents, air pollution and congestion, dramatically illustrated by the 60-mile traffic jam in Beijing in August. Realizing that such problems needed to be solved immediately, the Chinese government has singled out ITS technologies and products as a national priority in its last Five-Year Plan, in the hope that ITS applications can enhance transportation safety, improve transport efficiency and reduce carbon emissions.
Furthermore, navigation and real-time traffic applications also will receive a big boost thanks to the Chinese government’s priority to promote the Internet of things (IoT) and the electric vehicle (EV) business, attempting to make these two sectors the nation’s next economic growth engines. Among the IoT projects, the central government has made connected-car development a top priority national project, as announced in late October. The central government may inject tens of billions of U.S. dollars during the first stage of this effort, with the number of connected cars to reach about 200 million units by the year 2020.
The goal of the government is to facilitate ITS development and roll out relevant policies that would unite efforts from companies on the value chain. As for the EV manufacturers, navigation and traffic apps are crucial to their projects as entry-level requirements by the government.
The three major Chinese map providers of AutoNavi, NavInfo and Ritu are providing real-time traffic services to clients for various platforms. AutoNavi’s MiniMap now offers traffic information services for 12 cities and continues to expand its coverage.
Another competitor in the Chinese traffic information space is Shanghai Digital Broadcasting Co. The company supplies traffic data for the Shanghai and Shenzhen areas and is the traffic information service provider for the Mio DigiWalker C516t PND.
Finally, state-supported China Satellite Mobile Broadcasting Corp. launched a China multimedia mobile broadcasting (CMMB)-based navigation service in September 2009, starting in 10 cities. CMMB is a mobile television and multimedia standard developed and specified by CSMBC.
A Huge Effort
China is a vast country with significant regional differences. As a result, developing national ITS projects in the country will be very difficult, requiring a huge amount of effort in order to achieve effective coordination among various regional ITS projects utilized across multiple platforms. Such difficulties present tremendous challenges for companies in the ITS business, and it does not seem likely that an integrated and standardized national platform for traffic information services will be available any time soon.
Therefore, ITS providers should take into account the complexities in China and figure out a unique approach to tap into the Chinese market, such as fostering ITS projects with distinctly Chinese characteristics. For example, providers should focus on offering full coverage to Tier 1 cities on the east coast where traffic jams are so common that traffic apps are in huge demand. Providers should also improve the accuracy of their information and diversify services in order to differentiate themselves from rivals.
As for Tier 2 cities where traffic congestion is not as bad and often caused by faulty traffic lights or drivers violating traffic regulations, it is up to the government to achieve intelligent control of traffic lights, as well as install systems such as speed surveillance, emergency traffic control and en route warning in order to improve overall traffic conditions in those areas.
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