Mixed results for public-private traffic management partnerships

David Crawford looks at the somewhat patchy success to date of trying to involve the private sector in operating traffic management centres
UTC / January 25, 2012
The VMZ centre in Berlin
The VMZ centre in Berlin

David Crawford looks at the somewhat patchy success to date of trying to involve the private sector in operating traffic management centres

Many city authorities that are interested in developing modern Traffic Management Centres (TMCs) lack the financial resources to do so on their own. One possible solution that has recently been tried lies in developing Public-Private Partnerships (PPPs) for setting up (or upgrading) a TMC and/or managing its day-to-day operation.

The issue is one of those investigated by the European NICHES+ project, which ended in April 2011. This set out to encourage innovative ways of making urban transport more efficient and sustainable, and – in the process – has produced guidelines for potential TMC implementers that highlight recent PPPs as models for future initiatives.

Among these, Berlin’s VerkehrsManagementZentrale (VMZ – traffic management centre) PPP scheme ran for 10 years to 31 December 2010, following an award from the Land (state) of Berlin – to a private consortium between automotive corporation DaimlerChrysler Services and electronic giant 189 Siemens – of a design, build and operate contract. In April 2001, the two partners founded a joint operating company, VMZ Berlin Betreibergesellschaft.

Berlin owned the TMC infrastructure and covered the initial investment costs in hardware and software, while the two partners split the operating costs. The centre was seen as providing implicit traffic control by traffic advice rather than explicit traffic control, which remained a public-sector responsibility.

Mixed results

The private consortium provided, free of charge, basic mobility services (such as information on current roadworks and parking availability, congestion maps, live webcam pictures and route planners for private and public transport users). The original idea was that it would earn income from providing, for a fee, supplementary value-added services which were intended to finance the operation and recoup the investment.

Examples included customised travel planning, displayed via SMS or upcoming smartphones, as well as options to pre-book car parking spaces over the Internet and gain alternative ontrip route guidance to avoid congestion. Again there were hopes that hotels would order branded location maps with access and routing information.

But efforts to sell such services proved unsuccessful and, in 2006, DaimlerChrysler left the consortium. JörgLange, Head of the Berlin Road Traffic Authority, which now has full ownership of the centre: “The basic idea, 10 years ago, was to create new markets and so produce revenues for the consortium – but that failed.

“The possibility of earning money from selling traffic data still exists. But I think that this might perhaps cover less than five per cent of the total costs.”

In December 2010, the residual Berlin Betriebsgesellschaft won a conventional commercial service contract to run the renamed Verkehrsinformationszentrale (VIZ – traffic information centre) until 31 January 2020. The city of Berlin is now paying for the operation.

In legacy terms, Siemens sees PPP as important for giving it a prime opportunity to introduce and showcase, as a new product, its SITRAFFIC CONCERT computer platform. It has also been able to deploy, for the first time in a sizeable array, its solarpowered, infrastructure-independent Traffic Eye Universal (TEU) detectors, linking them directly into CONCERT.

Says Siemens spokesperson Ellen Schramke: “The great benefit we havegained is the experience of running astate-of-the-art TMC. We have hadvisitors from all over the world coming to Berlin, which we regard as the benchmark”.

It has also paved the way for the current Ruhrpilot scheme in the German Land of North Rhine-Westphalia, where Siemens is leading a consortium of fourprivate companies in a service contract. The scheme, the largest to date in Germany, covers a conurbation of five cities, with a combined population of 5.5 million and 13 separate transport authorities.

Developments in Italy

In Italy, the 5T (1673 Turin Traffic and Transport Telematics Technologies) multimodal project system was created as a PPP, with partners including locally based automotive 1674 Fiat and ITS specialist 1675 Mizar Automazione, to attract private investment into the €16 million (US$22 million) development of a metropolitanarea traffic operations centre integrated with a real-time public transport monitoring system. This has now expanded across the wider region of Piedmont.

Says 5T Senior Researcher Massimo Cocozza: “The private-sector members took part to enable them to develop and test new systems in the hope of creating new markets. It was a very good opportunity for both sides. Turin gained a very advanced system for mobility management, the latter gained valuable experience and the references.” As in Berlin, 5T is now a fully publicly owned company.

The UK experience

In the UK, the 10-year, £160 million (US$252 million) National Traffic Control Centre (NTCC) PPP project set out to provide accurate traffic information for road users and transport operators throughout England from a control centre near Birmingham, in the English Midlands. It followed a successful preliminary Midlands Driver Information System trial.

The 503 Highways Agency (HA), which is responsible for the English motorway and trunk road network, entered into a PPP with Traffic Information Services (TIS), a wholly owned subsidiary of global services company 1676 Serco, under the UK Government’s Private Finance Initiative. This ran the NTCC for 10 years, in cooperation with the police and local highway agencies, recouping its investment via performance-based payments from the HA.


The NICHES (New and Innovative Concepts for Helping European transport Sustainability towards implementation)+ project has investigated 12 innovative urban transport concepts and supported six ‘champion’ urban centres and regions.

Its work has culminated in the production of an urban transport innovation box of guidance manuals and implementation scenarios (including the one on private financing of TMCs).

A coordination action funded by the European Commission under the Seventh Framework Programme for Research and Development (FGP7), it was managed by European cities and regions grouping POLIS.

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Unlike the Berlin case, the contract included no provision for earning revenue from commercial value-added services. “We made our profit by meeting all our key performance indicators,” says Serco’s Matt Beeton. “At the same time we made additional investments in technology, which will help us in future contracts.”

Examples include a method for faster outputting of traffic messages to roadside variable message signs and an advanced display screen system. Serco is currently pursuing future global opportunities for TMCs, says Beeton.

The company bade unsuccessfully for a seven-year, £57 million (US$91 million) follow-on contact, which started on 01 September 2011, to run the centre’s traffic data processing and publication elements, renamed the National Traffic Information Service (the change from ‘management’ mirroring that in Berlin). The successful bidder is the Network Information Services joint venture between infrastructure services group 499 Mouchel and electronic systems specialist 596 Thales UK.

Republic of Ireland

Among planned smaller-scale initiatives Cork, in the Republic of Ireland (a NICHES+ ‘champion city’), has been unable to progress previously announced proposals to explore private finance for a UTMC-based mobile travel information service aimed at reducing car use in the city centre by making public transport more attractive. The reason is the country’s current economic situation.

However, the city council has commissioned infrastructure consultants 1677 Atkins, as an extension to an existing asset management contract, to develop proposals and options for the planned replacement of obsolete traffic management equipment. Senior Traffic Executive Engineer Ian Winning has said that options for private finance may form a part of the consideration of ways of developing the best possible system for Cork.

Belgium – another approach

Belgian company Be-Mobile has evolved another approach. The private-sector provider of traffic information services has developed a model for running these in partnership agreements with the country’s regional government-owned Flemish, Walloon and Brussels traffic management centres, and the police.

It takes their input and integrates this, together with Floating Vehicle Data (FVD) and mobile phone-derived data, into its traffic information feeds. Be- Mobile holds licences to operate IT IS Holdings' FVD technology and traffic platform, and has an exclusive contract with 1678 Proximus, the largest Belgian mobile phone operator, to process its network data into traffic flow information. The company derives its income from: providing premium traffic information services to road users; selling data to broadcasters and websites; and providing data and consultancy services to governments.

“We see the market becomingincreasingly international, and are now expanding elsewhere in Europe,” says the company’s Steven Logghe.

Be-Mobile is currently developing partnerships with highway/traffic authorities or media organisations in Greece, Luxembourg, the Netherlands, Portugal and Turkey to set up local traffic information centres.


The recent history of PPPs for TMCs, therefore, flags up some undoubted operational successes but also evinces a lack of willingness by the travelling public to pay for information services and soencourage private investment. Outside Europe Danny Vroemen, ITS Manager at Dutch-headquartered engineering technical services provider 769 Imtech, and a consultant to NICHES+, sees limited prospects - pointing out that, in Asia and Latin America, TMCs are often part of larger projects and/or run by the police.

In the US, Congress has budget-cutting on its agenda, and there is awareness that funding for major transportation and infrastructure projects could be in danger. There has been interest in general in the scope for PPP-type solutions, but evidence of concrete progress in the TMC sector has so far been slow in emerging.

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