Which ‘Rabbit Hole’ Do I Go Down?

December, 2017

We have been blessed, and cursed, by the quickening pace of technology coming into our industry. Blessed, because some of the technology has truly improved the customer experience and the bottom line. Cursed, some would say, because their lives used to be bound by a few simple pieces of equipment, but now they really have to think further outside the box than they have ever had to before.

The core technology that we have relied upon for the last 40 years for garages has been the parking access and revenue control (PARC) system. The purpose has always been to improve operations, reduce leakage and offer a better experience to our customer, the parker.

The traditional, or legacy, PARC systems have focused on three basic functions: entry, payment and exit. If you look at the current product offerings from the PARCS providers, they all offer a ticket-issuing device, a pay-on-foot (POF) machine and an exit verifier, all of it gated.

They also offer the capability of letting a parker pay a cashier at exit, but that is quickly disappearing from the landscape as more people become comfortable with a POF process or using credit-card-on-exit. Owners and operators like this trend, as it has the dual purpose of speeding up exits and reducing headcount, with the corresponding reduction in revenue leakage.

Over the last 20+ years, we have seen the accretion of new technology to the legacy PARCS infrastructure, such as AVI (automatic vehicle identification, aka RFID) and LPR (license plate recognition). Sometimes we deploy technology as a customer amenity and sometimes as an operational tool – in this case, both technologies have served both goals well.

We also have witnessed the introduction of mobile payments and parking guidance systems – again, great customer amenities. However, all of these technologies orbit around the PARC system – and therein lies the challenge.

Over time, as we have come to expect from technology, we have seen steady, incremental improvements in PARC system functionality, reliability and capability, in both hardware and software. Nevertheless, the technology is not where it should be, especially from a hardware perspective.

There is a reason that PARC systems exact a large penalty in maintenance contracts over their lifecycle – they need it, and some more than others.

The automotive industry is not a precise analogy, but look at the increase of reliability of cars today, compared with 20, 30 years ago. Looking under the hood, you can easily see the increase in technology (and cost), but it is coupled with a significant decrease in failures and maintenance.

Yet today in parking, we still expect to pay 10% to 12% annually for maintenance contracts – the same as we did 20, 30 years ago. Would you feel confident getting to work in your car every day or getting on an airplane if they had the same reliability profile as your PARC system?

As a result, today’s PARC systems have a heavy footprint in our garages, in terms of acquisition prices, maintenance costs and square footage. We have seen attempts to reduce the footprint, but they have followed the legacy, top-down mentality – a different means of entering maybe, but still in the mold of “what has always been.”

It’s time to rethink how we use technology, which is already available today, in new ways in order to lower the costs and amount of infrastructure with which we are currently saddled.

But first, let’s go down just a couple of other “rabbit holes” about our future.

The traditional, or legacy,
PARC systems have focused on three basic functions:
entry, payment and exit.

In one scenario, “connected” vehicles, upon approach to the entry gate, will signal their presence, and the PARCS will recognize the vehicle and its associated payment methodology. All of this will be accomplished with the simple addition of (another!) antenna at the entry and at the exit, accomplishing the “entry- payment-exit” process in a touchless, seamless way. We will still need all of the other currently installed technologies, because we will have many years of many millions of “dumb” iron cars on the roads and need to be able to accommodate them.

In a different scenario, autonomous vehicles won’t even need to park – they will just drop us off at the office and then go back home to service other family member needs, until it’s time to pick us up at the end of the day. Peripherally, today’s ride-sharing economy is a preview of this: Many times, people are now using a ride-share service to go out with friends, which in turns means lower valet parking revenues.

There are many other scenarios and variations springing up as people start to think about this more deeply.

Many people will say that such scenarios are so far in the future that they will be retired before they would have to deal with these things. Think of this another way: The average lifecycle of a PARC system is 7 to 10 years and connected vehicles are slated to enter the market around 2021-2022 – well within the life of the PARCS you are installing today. We make accommodations within our garages today for electric vehicle charging stations – just as we will add technology for connected vehicles when they come into service.

So, let’s agree that there will be new technologies on our immediate horizon and start thinking about how they will affect our operational environment. But at the same time, let’s stop thinking about the new technology as another “bolt-on” to the existing PARC system.

It is always a challenge, both marketing and technical, to develop and deliver good technology that straddles today and tomorrow. Some of the new(er) technologies emerging or in use today can be used together in new and creative ways that will loosen their current proximity to legacy PARC systems.

Customers will still pay, garage owners and operators will still get their money and their reports, but how it will be done will be a delight to those who have wanted to reduce their initial upfront costs and costly maintenance contracts, all with a much, much lighter footprint in the garage. Stay tuned!

Michael Bigbee, CEO Americas of Spaceek, can be contacted at at mbigbee@spaceek.com.