Toll Insight spoke with Bret Kidd, Chief Executive Officer at ETC (Electronic Transaction Consultants).
1. Please describe your career path that ultimately led you to join the tolling industry.
Though it’s hard for me to believe, I have over 25 years of experience in IT and professional services, almost all of that at the intersection of technology and either the transportation or public sector verticals. Perhaps it was fate or a form of luck, but every business that I’ve led required significant change and growth at the same time. So, I’ve developed something of a focus for “solving problems and building things.”
After earning my MBA, I joined Ernst & Young’s Strategic Advisory Services practice and later moved to Electronic Data Systems, where I focused on the transportation industry, leading accounts and the transportation portfolio through both the “dot-com” and “9-11” eras. Following Hewlett Packard’s acquisition of EDS, I led the Global Public Sector unit for the services business. The E&Y and EDS/HP experiences gave me deep insight into the power of technology to change entire industries, the centrality of Intellectual Property, the need to continually innovate and the criticality of talent in making all of it happen. Later experiences included founding and leading smaller IT services companies and going deeper into the travel-technology space at Travelport. Travelport is one of the three “global distribution systems” (GDS’) for the travel industry, where all travel products can be accessed and bundled by any travel agency. We provided a range of technology solutions through a transaction platform, which gave agency and airline customers access to much more powerful functionality than they could afford on their own, plus access to truly global supply of travel content.
When I first learned of the ETC opportunity, I saw elements of my prior experience converging into one business. ETC is all about developing and deploying technologies that improve customer operations. ETC was founded with an emphasis on innovation, and this remains a critical part of our culture. Plus, there are interesting parallels to Travelport’s “GDS” business and where the Intelligent Transportation Systems (ITS) space is headed. Through solutions like interoperability (where ETC was first to market in the early 2000’s), consumers can currently use many toll roads in a network through a single account, and over time, will be able to consume all types of mobility products, including parking, mass transit and related services – all this is very similar as GDS’ enable in travel. So, my experiences in the broader IT services realm bring some unconventional thinking for the ITS space; when combined with ETC’s experienced team, ETC solutions and the rapidly evolving needs of our customers and the broader industry, I hope this will contribute to a very successful outcome.
2. As a relative newcomer, what have been your observations about our industry to-date?
When I joined ETC, I found an industry on the verge of a revolution (or maybe a rapid evolution), with multiple outside pressures at work. There is the need for governments to use tolling revenues to close massive gaps in infrastructure funding, along with addressing other public policy objectives like traffic management and sustainability, where our technologies can assist. Most prominently, new, and emerging technologies are starting to exert influence on tolling under the broad and hitherto open-ended moniker of smart mobility – whether more fundamental technologies like IoT or 5G, or mobility-specific innovations like connected and automated vehicles. On top of emerging technologies reshaping the concept of individual mobility, we also see changing business models, such as a move to services from assets as well as interoperability, which can become essentially a clearinghouse for all forms of mobility… sold by transaction. Such disruptive changes are part of the broader economic shifts that influence every facet of running a business: they are at the root of it all.
And finally, long before COVID-19, nascent societal trends were also gearing up to change our industry, including remote work and distributed teams. Then, the pandemic dramatically accelerated them. The workforce’s leap towards virtual has impacted ETC’s own operations (which have become 90% remote) and the nature of the services we provide. COVID converted huge numbers of commuters to virtual workers and shifted many mass transit users to private vehicles. As a result, aggregate volumes on toll roads are at ~80% of pre-pandemic levels, but with traditional rush hour reduced and volumes spread throughout the day. The “new normal” has not yet been defined, and it will take even more time for new public policies to take shape.
3. What are some improvements and opportunities that you think we can target?
As noted earlier, I’m new to ITS, with nearly three decades of experience providing technology services in other industries. Every industry thinks that they are different from others, and to varying degrees, that is true. There are many unique aspects to the ITS space: the complexity of the technical challenge, the need for accuracy and speed, and the highly visible nature of the services provided are indeed rare combinations.
However, there are lessons, techniques, technologies and even business models that are proven elsewhere and very leverageable in ITS. Take a basic example: cloud computing. Cloud has been proven to be a safer, more reliable, less expensive alternative to on-premises operations for over a decade. However, ITS RFPs have only been asking for cloud-based solutions since about 2019. ETC now deploys cloud-based solutions for multiple clients, with excellent operational results.
What if there were other proven approaches from other industries, like SaaS solutions and transaction platforms that would provide ITS players with access to more features and functionality, but at much lower costs and better reliability than possible with a single-instance deployment? What if ITS players would consider more standard solutions that could be deployed more rapidly at lower risk, and best of all, bring in revenues faster?
All of this and more is possible, but it will take a few progressive ITS leaders to partner with ETC to pave the way. It will mean more flexibility in RFP requirements to allow for innovation and adaptable business rules, which will permit more standard solutions, delivered cheaper, faster, and with lower risk. This doesn’t mean unproven solutions; on the contrary, ITS customers should expect to see the solution fully operational as part of the decision-making process. ETC has successfully competed in “proof of concept” projects in the past and would absolutely do so when proposing new approaches/technologies.
Finally, much has been written about corporate challenges with adjusting to today’s demographic trends, brought about by millennials and Gen Z. Certainly, millennials and Gen Z do not fit traditional molds, but then again, when was talent ever synonymous with convenience and conventionality? The success of today’s technology firms is rooted in a balance between the know-how of the older generations of technology workers and the fresh outlook of the younger ones, who are more attuned to market trends. Finding that balance and offering a work environment that is attractive to such a workforce is where we see improvement opportunities. In the past few years, we have actively pursued them, with advanced policies such as a very liberal telecommuting (2-4 days/week, even before COVID), flexible time off (FTO), and more.
4. Recently, ETC was acquired by Quarterhill. Why did this acquisition happen, and why is it a strategic fit?
The acquisition happened because Quarterhill shares our vision for the growth and potential in ITS, and, for tech-enabled mobility as an essential solution to help expand and upgrade transportation infrastructure. Quarterhill’s vision is to be the global leader in ITS, and it has committed publicly to investing $400M to make this a reality. So, with Quarterhill, we have joined a platform for growth in both our core U.S. market, as well as globally.
The synergies with Quarterhill will help grow ETC’s existing portfolio and expand into adjacent markets by leveraging riteSuite™, our suite of mobility-focused products. Of course, ETC will continue to provide added value to its existing and long-standing customer portfolio while broadening its customer base. We will augment our existing solutions to extend into markets where Mobility-as-a-Service (MaaS) and ITS systems merge.
ETC's strength in tolling and mobility is complementary to Quarterhill's International Road Dynamics (IRD) business, which is a leader in Commercial Vehicle Operations and Enforcement. Joining forces under Quarterhill enables ETC and IRD to collaborate on revenue synergy opportunities, with product expansion and geographic expansion being two areas where we can support one another.
For Quarterhill, ETC was a transformational acquisition that will significantly scale its ITS business and expand its presence in the strategic U.S. market. With Quarterhill’s commitment to growth, IRD as a “sister company,” and more investments to come, ETC is absolutely going to be on offense for years to come.
5. What can the tolling industry expect going forward in terms of your market engagement?
Although this is a pivotal time for ETC, with an evolving mobility technology platform and new projects under our belt, the first thing to expect from us is the continuation of our customer-focused approach and project delivery excellence. This underpins everything else for us, as evidenced by our customer references and the average tenure of our customers, which is over 12 years.
The market can also expect continued innovation. ETC has had many industry “firsts”: first in All Electronic Tolling, first in dynamic pricing, first in interoperability and, in anticipation of the ongoing trends, ETC was one of the first tolling integrators to embrace open source and SaaS technologies. The principle is to take the best fit-to-purpose SaaS/COTS/open-source technologies for each function and adapt them into riteSuiteTM, our modularized suite of standalone subsystems that run on the same underlying open-source technology platform. These underlying technologies are continuously updated by major consumer data companies, like Google and Netflix – so we can remain evergreen. Having continuous technology relevance built into our system DNA opens many doors. You will see us expand to absorb new technologies for emerging needs like congestion pricing, road user charging, MaaS, etc. – wherever the current mobility trends take us.
Taken together, our customer focus, our delivery discipline, specialized delivery expertise, and the scalable open-source technology platform form the stable foundation that we need to launch our strategic plans for growth and advancement in tolling and the broader mobility marketplace.
Thank you, ETC, for sponsoring Toll Insight!