Across the Digital Nation: Transportation ? Opportunities on the move

Rishi Sood

Buoyed by federal legislation plus technology refresh cycles and innovation, transportation agencies are at the forefront of significant technology change. Over the next three years, these issues will help shape new technology opportunities within this marketplace.

Reauthorization of federal transportation legislation supporting the extension or replacement of the Transportation Equity Act for the 21st Century, will have a major impact on the deployment of intelligent transportation systems by state and local governments.

This legislation, known as TEA-21, will provide significant funding for large projects and an impetus for a new wave of technology initiatives.

The continuing success of electronic toll collection systems, the emergence of congestion pricing systems and the development of greater intermodal management systems are all major technology opportunities.

The main issue is whether federal decision-makers will furnish single- or multiyear funding for them.

Similar federal legislation supporting national standards for driver's licenses now has coincided with a technology refresh cycle in the motor vehicle segment. Most digitized licenses were implemented in the early 1990s, and efforts to modernize things are beginning to brew.

States are increasingly interested in using biometrics and smart-card technology to provide greater security measures.

Moreover, there is greater awareness for the need to treat groups of drivers -- of trucks, hazardous waste carriers and the like -- with special services to increase customer satisfaction as well as monitor sensitive shipments.

Port authorities are another key growth segment under the Transportation Department banner. Given the increased homeland security focus on bridge, sea and airport authorities, these organizations are starting to build new technology plans.

Ports authorities are looking to implement key initiatives in operations management, radio frequency identification tracking systems and wireless communications.

They also are investing a lot of money on physical security technologies, such as secure identification and closed-circuit cameras. The Homeland Security Department recently authorized $50 million in the fourth round of port security grants, bringing the total allocation to just under $500 million.

The transportation segment is certainly unique. It is one of the largest areas of operational spending within government; the locus of activity is at the state level and can be subdivided into transportation, motor vehicles and port organizations.

Transportation tends to be one of the richer agency segments, because it is able to use a combination of funding to support ongoing expenditures and technology implementation. In contrast to many other agency segments, relatively few vendors have a carved out leadership positions.

As a result, state and local government vendors should assess the appropriateness of targeting upcoming transportation opportunities. Already, many federal firms with expertise in security have scored major wins in this segment.

For example, BAE Systems Integrated Defense Solutions Inc. won a prime contractor slot on a $4.4 million project to build a modern command and control center for the Houston Port Authority.

Lockheed Martin Corp. won a $2 million contract to develop a new security command center with the Port of South Jersey, and L-3 Communications Corp. won a $3 million contact with the Port of Virginia for a smart video surveillance system.

Similarly, a number of technology vendors created partnerships with major engineering firms to help generate new business opportunities. As the market begins to take off, the competitive landscape is bound to become clearer.

Rishi Sood is a vice president with Gartner Dataquest in Mountain View, Calif. His e-mail address is rishi.sood@gartner.com.

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