Market Mad House

In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. Friedrich Nietzsche


How to Think about the Hyperloop

The Hyperloop is a very hard concept for people to grasp because it is totally different from existing transportation solutions.

That makes it difficult to explain, harder to analyze and very easy to criticize. Worse it is very easy to sensationalize the Hyperloop largely because of star power of its’ creator Elon Musk.

So what is exactly is the Hyperloop and how will change the world? Those are the questions we will try to answer below without sounding like “Hyperloop for Dummies.”

What is Hyperloop Anyway?

The best description of Hyperloop that I have heard is as an airplane that operates at ground-level. Okay, that’s confusing but more accurate than the description of the technology as a next-generation train.

The basic concept behind Hyperloop is a very simple one; take a long tube, pump a large percentage of the air out of it, then propel pod-shaped vehicles through it at very high speeds. This solves the major problem facing high-speed transportation in an efficient manner.

We have known how to make vehicles move at very high speeds for a long time, yet it often does us little good. Supersonic planes have been around since the 1940s and high-speed trains since the 1930s. The problem is that they are constrained by geography and nature.

Hyperloop vs. High-Speed Rail

High-speed trains are limited by environmental conditions including the weather, rain, sleet, snow, wind, etc. can interfere with the train on the tracks. Air and wind resistance can limit speeds as can safety concern. There’s always a danger of people, animals, or debris getting on the tracks and causing a wreck.

An even greater concern is density, to be practical; and make money trains, have to run where the people are. Yet nobody wants a train shooting through her community at 600 miles an hour creating a sonic boom.

A related problem is that train tracks can interfere with other transportation solutions – such as vehicles on streets or highways. Many of the worst accidents occur at surface level crossings where vehicles drive across the train tracks.

Hyperloop eliminates all that because it runs inside a tube. It can move at almost any speed without interference of the weather and eliminate the noise and safety concerns.

Hyperloop vs. Airplanes

The limitations facing airplanes are even greater than those of rail. Planes require runways; which take up a lot of room, so they cannot travel in many areas. Passengers might have to travel hundreds of miles to reach the airport, before they even board the plane.

Airliners also burn a lot fuel and make a lot of noise. Nobody wants an airport in their neighborhood, although everybody wants the speed and convenience of air travel.

Hyperloop offers the swiftness of air travel it might be able move at speeds of up to 700 miles per hour and the functionality of rail. The tubes that carry the vehicles can be built right into the center of cities, and they might operate with the frequency of a subway. A huge advantage to Hyperloop is that it can be buried inside a tunnel so it can move under cities.

Yet Hyperloop would be far cheaper to operate than planes because it runs on electricity not jet fuel. That means less pollution and lower maintenance costs. Another advantage is the elimination of airport hubs which increase other transportation costs.

Lower costs; which would make high-speed long-distance travel available to even the poorest people, will be another revolutionary development. If it works as advertised Hyperloop would make travel between Denver and Chicago, as easy as taking the subway from Brooklyn to Manhattan.

Hyperloop as Utility and Infrastructure

The other big way to think about the Hyperloop is as utility and infrastructure. The tube itself can house power or even gas lines and serve as a conduit for energy.

Some illustrations have shown solar panels on Hyperloop lines and tubes running by wind turbines. That means Hyperloop would serve as a sort of next-generation grid transporting people, freight and energy at the same time.

This fits in with Elon Musk’s plans to make vast amounts of electricity as widely available as possible to take the place of fossil fuels or reduce the need for them. An excellent means of achieving that goal would be to combine Hyperloop with battery storage.

Musk’s energy company Tesla (NASDAQ: TSLA) is already building giant battery farms for electricity storage. Some of those farms are powered by giant solar arrays, using panels created by its Solar City subsidiary.

Hyperloop as Next Generation Grid

A successful Hyperloop grid might create giant solar or wind farms out in the country side with cities. The electricity would power the Hyperloop itself and feed the grids of the communities it ran through.

Beyond the grid there is telecommunications; telephone and high-speed internet, which would be easy to run alongside or through the Hyperloop tubes. Musk himself has talked of a “smart tube” for Hyperloop. The tubes might provide high-speed internet and phone service to communities as well as transportation and energy.

It is no coincidence that the CEO of Hyperloop One; which is building a tube system in North Las Vegas, Nevada, is Rob Lloyd. Lloyd was formerly the president of the internet infrastructure company Cisco Systems (NASDAQ: NASDAQ: CSCO). Lloyd thinks of Hyperloop as the logical extension of the internet.

His vision is of a grid that moves freight and people much as the internet moves data. Such a system would generate revenue by charging to move energy and information as well as passengers and cargo.

The Next Great Paradigm Shift

That would make Hyperloop the most massive and most integrated infrastructure project in human history. If it works the system would also be incredibly efficient by eliminating many older and far less efficient solutions; including railroads, airlines, airports, highways, powerlines and telecom cables.

Such a solution would also be a paradigm shift that will change the nature of our countries, our communities, our economies and our lives. Therefore the best way to think about Hyperloop is as the next great paradigm shift in how we organize our civilization.