The Doppler Quarterly Summer 2017 - Page 67

As a service provider (or as an incredibly forward-thinking 2PL), imagine what would be possible if you were able to ingest all of that real-time geospatial/ temporal and sensor data and combine it with real-time and historical weather data, news, organized labor/strike info, your company’s or client’s ERP-based shipment info, and even social media feeds into a massive data lake on which you can run your machine learning algorithms. You would then have the ability to publish a real-time, predictive index for the movement of all public goods and assets worldwide. You bet that there will be significant market interest in a service provider that can demonstrate looking backward with 90+% accuracy and forward with 80+% accuracy. In fact, there are companies who have built precisely this type of platform and service (I used to work for one). Priming the Pump and a Path Forward Okay, so you’re thinking this sounds great, and you’re wondering why aren’t these services broadly available? The short answer is still tied up in the hard realities of the ultra-low-margin global logistics market. GPS trackers have come way down in cost, but perhaps not far enough yet for all twenty million intermodal shipping containers. In fact, as of 2016, it’s been conservatively estimated that less than 5% of all containers are currently tracked, and the majority of those that are tracked are so-called “Reefers,” or refrigerated con- tainers, that have access to power with battery backup. Not unlike what the Public Cloud has already done for IT infrastructure, for- ward-thinking service providers need to find a way to shift the hardware track- ing cost model from CapEx to OpEx. At scale and over time, the hardware costs will continue to fall, but even at $20/unit, it’s still a lot of CapEx if you have to buy millions of them. Good luck trying to explain that to a finicky venture cap- ital or private equity firm though. At the same time this problem screams for an industry-wide consortium or alliance whose sole focus is the better interchange of these types of data in a secure manner. Everybody benefits from better visibility. Some more than oth- ers. As the global shipping market consolidates into the hands of a few brave (some would say foolish) companies, each with large market share, but with few seeing any profit growth in an already low-margin business, it could be a while yet before the vision of a truly automated logistics market becomes possible. These industry-wide challenges are tough to solve and require commitment on behalf of both individual companies and the overall market to address