Opinion

Felix Salmon

Did wifi cause a rise in bus ridership?

By Felix Salmon
December 26, 2011

bus1.tiff

What’s behind the rise in bus travel in recent years? It certainly seems very impressive, according to the latest research from DePaul University.

Here’s how Bloomberg’s Jeff Plungis characterizes it:

Megabus.com and BoltBus led U.S. curbside bus companies that boosted trips by 32 percent this year as travelers opted to leave their cars behind and surf the Internet while traveling.

And here’s Matt Yglesias, with a slightly different take:

Like Duncan Black, I’m far from certain that the right way to understand this is actually as intercity bus trips substituting for intercity car rides. The way I would primarily interpret it is as these services leading to additional trips that wouldn’t otherwise have been taken. Instead of riding Amtrak to New York once a year, you ride the bus three times instead.

If you look at the data, Yglesias seems closer to the mark than Plungis. Could the massive 30% rise in curbside bus ridership be accounted for by the 1% fall in private autos? Possibly. But it’s more likely that something else is going on.

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Both Plungis and Yglesias, I think, miss the elephant in the room, and the obvious reason why the DePaul measurements for bus ridership have been growing at such a startling rate. Here’s how the paper puts it:

The analysis we provide also excludes all “Chinatown operators,” which have significant different qualities than mainstream operators. As a general rule, those carriers listed on the GotoBus.com web site are considered for purposes of our study to be Chinatown operators. Many of these carriers do not invest in a brand identifiable by the paint scheme or insignia on their buses.

Indeed, DePaul specifically excluded the dramatic growth of California’s USAsia Bus Lines, just because they determined that it counted as a Chinatown operator.

The obvious theory, then, is that big operators like Megabus and Bolt Bus saw the huge success of the Chintaown bus market and saw an opportunity there. They brought in branding and professional marketing and wifi and much higher safety standards, and succeeded in taking a huge amount of market share from the Chinatown operators who were never part of the DePaul survey in the first place.

That theory is borne out by my own anecdotal experience: when my friends took the bus from New York to DC or Boston ten years ago, it was normally a Chinatown bus. Today, it’s more likely to be a Bolt Bus, or even a higher-end product like the Limoliner.

In other words, the DePaul data is consistent with total bus ridership actually staying constant, with the recognized curbside buses simply taking ridership share from unrecognized Chinatown operators. In reality, I suspect that bus ridership is growing. Just not nearly as fast as the DePaul paper would have you believe.

As for the much-vaunted wifi on these buses, it’s basically the same as the wifi on Amtrak, or from Gogo in-flight: in a word, crap. If you’re working on a laptop and can download emails or web pages in the background while reading or writing something else, then it’s fine. But it’s pretty much useless for people on iPads, where the lack of multitasking means you can’t read one thing and download something else at the same time.

It seems to me that the travel industry in general has done a very bad job of adjusting to the fact that most wifi-enabled devices these days are not laptops. I even stayed at one pretty high-end hotel in England, recently, which thought that providing an ethernet cable was a perfectly good alternative to providing wifi, and which didn’t have any kind of Airport Express devices or similar that it could lend out to guests who didn’t have ethernet ports on their computers or tablets.

So far, no one’s really cracked the problem of the mobile web — we’re still in a world where connecting to the internet when on the move is far too difficult, and needs to be configured (and often paid for) on a device-by-device basis. Companies like Lightsquared want to change that, but for the time being they’re vaporware, and I’m not holding my breath for them to arrive. Which means that for the time being it’s a bit of a stretch to say — as Plungis, for one, does — that the mobile web is actually changing the way we travel from city to city.

Comments
9 comments so far | RSS Comments RSS

So you don’t think the weak economy/rising cost and wasted time of air travel has any impact on how people get from city to city?

As someone who would love to give networks and the internet credit for wonderful things, I’m skeptical about attributing the increase in bus ridership to wi-fi. People are probably happy wi-fi is available, but buses are not as convenient as cars or comfortable as trains, but they are less expensive and less complicated.

Posted by KenG_CA | Report as abusive
 

Good article but I think people are using it as an alternative to cost + hassle of flying or cost of tolls + gas. I’ve used Bolt/Mega buses 14+ times and each time, less than 1/2 of people are using the Wifi.

These buses offer last-minute deal fares for $1 (when it isn’t full). I think it really comes down to cost + convenience of traveling (Wifi being just one of the added conveniences)

Posted by Maryam_Sabbagh | Report as abusive
 

I have to pile on and agree that this sounds like it has a lot to do with cost savings. I heard about MegaBus just a few months ago for the first time. I had driven to Chicago and met someone from my hometown of Cleveland. She told my wife and I that the next time we trek out to Chicago we should try MegaBus because tickets cost about $8. That was roughly half of what we had paid in tolls, let alone the cost of gas. The fact that these buses apparently also have wifi never entered into our conversation.

Posted by spectre855 | Report as abusive
 

Re your hotel: your problem was staying in a high-end hotel. In my experience, there is an inverse correlation between internet services and hotel price level. The more expensive the hotel, the less likely it will have free internet, and the more likely it will be perceived to be some business-only, corporate-expensed facility for schlubs forced to take their work with them. Similarly, the actual internet provisions will be at a level that’s miserly for a house with more than 4 internet-using occupants; typically a residential ADSL line of at most 20Mbits is shared across all guests.

I remember once paying about 20 USD for one night’s access to “premium” internet at a hotel in Amsterdam. Unfortunately, there were about 10 other technologists with my group in the hotel – we were speakers at a conference. The maximum download rate didn’t exceed 60kbit/sec. I’d have had a better internet connection on my phone.

Posted by BarryKelly | Report as abusive
 

It’s true: taking a plane or train in the northeast corridor has become such a costly PITA that buses are a more attractive alternative. And in addition to bolt, etc., competing with the Chinatown buses, Greyound has had to reduce its rates on these routes.

Posted by MacCruiskeen | Report as abusive
 

Hey, did you know that Greyhound charges an $18 gift ticket fee for 3rd party transactions? Greyhound says that this fee is to combat credit card fraud and handling charges, but when examined, these explanations do not stand up to scrutiny.

Join over 8,000 who have signed an online petition to end this fee at:

http://www.change.org/petitions/greyhoun d-eliminate-the-18-gift-ticket-fee

Posted by Sambrose | Report as abusive
 

Agree with the comments. (1) Cost – NE Amtrak is absurdly overpriced to subsidize rail travel in already useless and over-subsidized fly-over states; (2) Flying is an indignity nowadays; (3) Comfort – buses are more comfortable than airplanes, and easier to get to than trains.

Posted by maynardGkeynes | Report as abusive
 

Layers and layers of misinformation here . . .

First, the DePaul study didn’t measure ridership at all! It only looked at the number of buses scheduled and assumed a correlation with ridership – a connection that is tenuous. Not only because the Chinatown operators were excluded (but no, just because they sell tickets on gotobus.com does NOT mean they are a Chinatown operator) but because the buses might be empty and because it ignores the practice of running multiple sections of a singled scheduled run. (ie, one scheduled departure but multiple buses operating that schedule — a normal occurring in peak times for Greyhound and now apparently for Megabus too).

In fact bus ridership is increasing, as judged by other, better studies.

The “Estimated Growth in Passenger Ridership” chart is deceptive. 95% of intercity travel is by car, so a 1% drop in car usage is easily enough to account for all new trips by bus, train and plane combined and still represent a decline in total travel. If bus travel doubled it would represent only a 1-2% decline in auto travel.

Wi-Fi does make a difference? A bigger difference for bus operators than for trains — because it sends the message that the service is for technologically aware people rather than the choiceless. It was necessary for the intercity bus industry to break out of the position of being last resort. So even if nobody uses it, it makes a difference because it helps attract a different demographic.

Amtrak estimated that installing wi-fi would increase ridership by 2%. Thus it would bring more revenue than it would cost.

Amtrak charges more in the northeast because the service is better and thus it has more pricing power since it’s more competitive (that is, it charges more because it can). Speed is typically 110mph (more for Acela) and frequency hourly. Not so in the rest of the country.

For me personally wi-fi makes a huge difference. If my travel time is “billable hours” as they say, it doesn’t matter longer it takes (within reason) since I’m being as productive as at the office (or getting as much rest or fun as I would at home).

Posted by conductorchris | Report as abusive
 

Your title is misleading: it’s not the wifi, it’s the new fish jumping into the chinatown bus pond. 10 years ago, Chinatown buses were awesome deals compared to greyhound, but lots of people either didn’t know about them or were culturally uncomfortable with buses that seemed to be for a particular demographic (chinese people or poor people). Now greyhound’s fares are much reduced and the new buses offer cultural acceptability. Wifi is window dressing.

Posted by colburn | Report as abusive
 

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