Saturday, November 26, 2005

For many years now I've pondered what's next in delivery services. In 1973, FedEx gave us overnight delivery. With faster delivery you not only make more shipments of the same type of items you had been shipping (“depth”), you also ship things you would have never shipped before (“width”). Instead of trying to capture more of the pie, FedEx expanded the pie, both width and depth, made lots of money, and made their customers happy.

The next step for delivery services is to again dramatically improve delivery times. There are lots of times I'd like to buy something online, but the delivery time is too long, so I end up going to a store. For example, when I went on a cruise to Alaska, I wanted to buy a digital camera. We were leaving for the cruise the next day, so I didn't want to order online. If delivery were faster, I would've ordered online. This is what I call “depth” expansion of the business—more deliveries of the type of items people ship anyway.

There are some items that I would not consider ordering online from a faraway place. The main example is prepared food. If I want a pizza, I will order from a local store but not from, because pizza delivery via FedEx is too slow. If delivery took an hour instead of a day, people would be willing to ship meals. I could order a Philly cheese steak sandwich from .. Philadelphia. This is what I call “width” expansion of the business—delivery of items that people would have never shipped with a slower delivery system.

To get faster delivery, we need something that goes much faster than trucks. To get my sandwich from Philadelphia to California in one hour will require something travelling 3000 miles per hour. Unfortunately this is faster than the speed of sound. Supersonic travel is expensive and complicated. If we can lower the air pressure, we can reduce the air resistance and lower the cost of moving a shipment. (Surprisingly, air pressure does not affect the speed of sound.) Thus, the solution is to use evacuated (near-vacuum) tubes.

A network of evacuated tubes running throughout the country would allow fast delivery of small packages. These tubes would be connected together at hubs, which would function somewhat like Internet routers. The RFID tags in each package would be used by the hub to route it to the best tube. As with the Internet, the package hubs could adapt to route around congestion. However, unlike Internet packets, we don't want to lose packages.

The cost of building evacuated tubes to every household is incredibly high. Initially, the deliveries would be made to central locations in each community, perhaps post offices. Either the post office can then deliver packages to your home/office, or you can go there to pick it up. The next stage would likely be to build tubes to higher density locations like office buildings, skyscrapers, and apartment complexes. Lower density locations like single family homes would most likely be the last to receive delivery tubes. In older locations where new infrastructure is not being upgraded, tubes might be attached to the inside top of sewage tunnels.

I think getting sandwiches from Philadelphia to California is unlikely to be practical. However, having a sandwich delivered from across town in a matter of minutes could become commonplace. If you want a book, Amazon could print it at a local printer and then have that book delivered to you within minutes. EBay sellers could send their small goods through this network. If shipping on EBay became fast and convenient, we might see everyone participate. It could be the P2P of physical goods.

The initial cost of such a system is very high. The value of a delivery system is that you can ship anywhere. It does little good to have tubes running to only a few cities, although it might be feasible to use existing delivery services in conjunction with the tube system. Once the system is built, he marginal cost is lower than with FedEx, because the entire system can be automated. In addition, the demand will be much higher than the current demand for shipping services. I think eventually this system would be very profitable.

Go ahead and laugh at this idea. They laughed at the idea of overnight delivery too.

Update: [2012-09-01] Someone else had the idea of delivering package through the sewage tunnels.

Update: [2014-03-30] has announced that they're going to offer faster delivery with flying robotic drones!



Ravi wrote at Saturday, November 26, 2005 at 10:51:00 PM PST


Sumit wrote at Tuesday, November 29, 2005 at 3:51:00 AM PST

I always wondered why KFC (Kentucky Fried Chicken) became such a who-ha in Bangalore India. (It was closed later due to this)

Someone thought of cooking the food closer. Like your point of Amazon getting the book printed near by and then deliver in a hours time. Most of the food chains work in the same fashion.

There was a time, when a Indian wanted to have a chicken Mac he had to travel all the way to Delhi from Bombay (1381 Kms), now McD’s are all over.

In certain places I have seen “Café Coffee Day” outlet giving serious completion to another “Café Coffee Day” outlet, they are 1 km apart. Seriously insane.

If someone someday manufactures a standardize Chicken Mac Maker (Both in 110-120 volts and in 220-240 volts :) ) and then one standardize the raw material.

Tink you can make your own Chicken Mac at home. This works fine till the time you have the raw material. (otherwise your Goods Delivery Hyper bypass Tube, can do this :))

How about mineral water, earlier one needed to go to a mall (shop in India) to buy a bottle, now you have the electronic water purifier, So it came inside people’s room.

The problem with any kind of transportation system is that it is destined to get cluttered, bogged, and overwhelmingly congested.

The tubes will have routers, those routers will have other routers, some tubes will have smaller connecting tube (lower bandwidth :)), then you have virus moving across.

Then upgrades for both way transfer. Etc.

Your vision of Goods Delivery Hyper bypass Tube is excellent and seems feasible in future. The vision of creating, developing and manufacturing in your own room seems absurd but well, no costs for wild imaginations :)

Anonymous wrote at Thursday, March 23, 2006 at 6:33:00 PM PST

the swed's are doing this with there new trains going through tunnels
the trains move very fast now and if there is a collision there is very little fire