The Department of Transportation Should be on Your IoT, Cloud, and Big Data Radar

Posted by Alexander Rossino on March 8, 2016

Road Infrastructure

Chances are you haven’t heard of the U.S. Department of Transportation’s 21st Century Regions Initiative. I hadn’t either until I recently read through the DOT’s budget request for fiscal year 2017. Verbiage pertaining to the “21CRI,” as I like to call it, is all over the documentation, which is eye-catching enough. However, it was the dollar amounts associated with it that really grabbed my attention. To wit, “over a 10-year period, the [DOT] Budget invests an average of $10 billion a year toward a series of new, innovative programs that improve the balance of funding and decision making and will accelerate the move toward smarter, cleaner, and more integrated communities.”

Ten billion dollars per year is a tremendous amount of money, even in a town like D.C. where multi-million dollar errors can be attributed to rounding mistakes. Admittedly, most of this funding goes to large-scale grant programs, so it isn’t directly addressable by vendors on the federal level. There is, though, another way for contractors to benefit. Grants to cities and states to invest in sensor technologies for smart transportation will find their way into contractor coffers because those recipients will need to spend their grant money with companies that provide the technologies they require. What’s more, the technologies purchased by these grants will establish the infrastructure through which petabytes of data per day will flow back into USDOT databases. This is data that DOT analysts will need to analyze using big data tools and contractor services. Contract awards will also be needed to provide the technical expertise that the DOT needs to make the most of its grant investments. Call it a virtuous cycle, if you will.

The 21CRI is closely related to the Moving Ahead for Progress in the 21st Century (MAP-21) Act, which Congress passed and the President signed in July 2012. MAP-21 funding for surface transportation programs has been running at nearly $100 billion per year since FY 2013, according to the Federal Highway Administration. A portion of this investment flows into sensor technology that is part of the Internet of Things, meaning that IoT vendors seeking business are probably finding more opportunity at the state and local level than on the federal level at this point.

The USDOT intends to kick this investment into high gear in FY 2017, which should greatly accelerate spending on IoT technology at the state and local levels. The opportunity for big data vendors related to the 21CRI will be found at the federal level as agencies grapple with the returning data. One big question facing DOT agencies is where to store all of that data. The Federal Aviation Administration’s Cloud Services vendor, CACI, will undoubtedly be called on to host data, but it is unsure their capacity will be sufficient. Remember, this data will be coming in continuously from every vehicle, streetlight, and traffic signal in the country. Will any single vendor be able to handle it? The answer to this question may be found in the Federal Highway Administration’s FHWA Big Data Request for Information (#DTFH6115RI00006). The notice makes it clear that the FHWA wants to utilize commercial clouds that possess the capability to run advanced analytics.

Summing up, we can easily see the shape of things to come. A >$10 billion per year USDOT investment related to the 21CRI will flow to vendors on the state and local level through local contracts funded by grants. Those vendors will build the IoT infrastructure that sends data back to DOT agencies, requiring components like the FHWA to invest millions of dollars in contracts to cloud vendors with analytics capabilities. Vendors positioned on both ends of the process thus stand to benefit from government investment in the IoT, cloud, and big data. This is why if you are an industry partner in this space the USDOT should be on your radar.