The Commercialization of Transportation
Commercialization involves the extension of the operational scale of
transport systems insures
that it reaches its optimal market potential for the passenger and
freight markets. Although an optimal market size
can never be attained due to regulations preventing monopolies and differences
in consumer preferences (e.g. modal choice), the trend to ensure maximal market exposure
is unmistakable. Within transport systems, four
distinct cyclic phases of extension and functional integration can be
Each of these phases tends to be sequential and related to an historical
process of transport development. For instance, up to the mid 19th century,
most distribution systems were isolated and developed independently
from one another. Even global maritime transport was fragmented by national
flags and trading systems. As regional transport systems grew in the
second half of the 19th century, they gradually interconnected, but
moving from one system to the other required a form of transshipment.
By the early 20th century, most national transport systems were integrated,
but interconnection between modes was difficult. The next challenge
resided in the development of intermodal transportation, accelerated
by containerization and information technologies.
- Introduction. Initially, a transport system is introduced
to service a specific opportunity in an isolated context. The technology
is often "proprietary" and incompatible with other transport systems.
Since they are not interconnected, this does not represent much
of an issue.
- Expansion and interconnection. As the marketability and
the development potential of a transport system becomes apparent,
a phase of expansion and interconnection occurs. The size of the
market serviced by these transport systems consequently increases
as they become adopted in new locations and as new providers are
created to service those markets. At some point, independently
developed transport systems connect. This connection is however
often subject to a function of transshipment between two incompatible
- Standardization and integration. This phase often involves
the emergence of a fully developed transport system servicing
vast national markets. The major challenge to be addressed involves
a standardization of modes and processes, further expanding the
commercial potential. Modal flows
are moving more efficiently over the entire network and are able
to move from one mode to the other through intermodal integration.
A process of mergers and acquisitions of transport providers often accompanies this phase
for the purpose of rationalization and market expansion.
- Integrated demand. The most advanced stage of extension
of a distribution system involves a system fully able to answer
mobility needs of passengers and freight under a variety of circumstances, either
predicted or unpredicted demand. As this system tends to be global,
it commonly operates close to market potential. In such a setting,
a transport system expresses an integrated demand where
transport supply is tuned with the demand in an interdependent system.
There may be several competing providers of transportation
services, but their offer is comparable and usually focuses on
geographical niches or specialized services.