Intel's expected $1 billion acquisition of Israeli mobility app developer Moovit cannot be understood in the way that regular mergers are seen. Moovit sells to the public at large an app for planning journeys on public transport while Intel produces chips. But the two companies intersect not where they are operating or selling today but where they hope to be in the future - leading the smart transport sector and what is called Mobility as a Service.
Moovit has developed a smartphone app for navigating public transport that helps passengers plan the route of their journey to connect between various forms of transport in the most efficient way. While the public can download the app for free, Moovit is able to gather vast amounts of data about people's travel habits within cities and between them. The company's business model is built on the data that it sells to local authorities, and other companies working in the field of transport.
Thus Moovit is much more than the journey planning app that the consumer sees as an end user. Like vehicle navigation and traffic app Waze, Moovit is fed not only by the passive data from those using the app but also enjoys the volunteer activism of users who help enrich and improve the information that it gathers. This data concerns travel routes, bus stops and railway stations and more.
Together with the data that it obtains from Mobileye, Intel's most major acquisition demonstrates the importance that it sees in the transport sector and as future business growth engine, the data that it will obtain from Moovit can provide it with a broad picture of the overall behavior of the transport ecosystem, maps of routes and stops, the different public transport networks, and even the ability to cross reference how travelers want to travel with how they end up having to travel. In actual fact the real link-up here is between Mobileye and Moovit and it is no coincidence that Mobileye founder and CEO Amnon Shashua represents Intel on Moovit's board of directors.
Thus with Mobileye on the one hand and Moovit on the other hand, Intel can in the near future create a Mobility as a Service system for almost any city worldwide based on an infrastructure of these technologies and its processors and servers will be able to offer it in one bundle. The fact that Intel is an enormous company, with close connections to governments and regulators, will be especially helpful in allowing it to expand in the transport sector, where relationships with municipalities and government bodies are so important. For authorities it is important to do business with large and well-known companies with cash flows that will keep them operating for many years to come.
The timing of the deal in the era of coronavirus may sound surprising when taking into account that this is an app managing data during a period when people are reluctant to travel on public transport. On the other hand, people will prefer to plan their journey to ensure that they are on buses and trains for the minimum possible amount of time.
But these current considerations are not the story behind the imminent deal but rather the connection between smart transport and smart cities. This is a trend that started long before anybody had ever heard of Covid-19 although it some ways the current crisis may also have helped push the deal through. This is because there is a fast growing understanding that available data is important in the smart management of 21st century life and that it provides greater control and monitoring options for the authorities. In general, the coronavirus has made people much more digital and the marriage of Intel, Mobileye and now Moovit is a positive step in this direction.
Published by Globes, Israel business news - www.globes-online.com - on May 3, 2020
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