This is what happens when you believe the private sector is the answer to everything. We reinvent the wheel one hundred times, and each time its more square than before.
I think the point is, unlike buses with fixed routes, such shuttles could deliver people to places that face temporary massive traffic - like concert venues or whatnot.
There is no need to constantly run huge amounts of buses there, but at some point of time there's a lot of people willing to go - and such shuttles, flexible in their routes, may be the solution.
Do people consider shuttles and buses the same thing? Because this sounds like a shuttle, which as far as I'm aware is completely different from a bus. I take a shuttle to the airport, which requires a reservation and ~$50 whereas I take a bus to get around town and it's typically free.
Essentially it sounds like they are trying to dip into the shuttle market, not the inner-city bus market. Though maybe both?