M-Payments Next Step

 

A week for celebration with the HOP card now available on all NZ Bus services in Auckland - but the reality is this technology is fast becoming old school.
While we will have, hopefully, all Auckland public transport on board with one smart card by the end of next year, the rest of the world is moving on.
The future of payments is not a HOP-type card but your phone or a credit card.
For transport operators, it’s cheaper to run. For commuters, it’s easier and the way they will do most small transactions.
In the UK already, Chiltern Railways allows customers to buy a ticket on the phone, and wave the 2D bar code in front of a gate-mounted or guard-wielded reader.


It’s the same as your Air NZ m-pass you can use on smartphones at airports.(tip you may want to avoid the music on this video!)

Here it such a system in action:

In London the plan is for the Oyster card to be scrapped by the end of next year for a system that allows commuters to pay for journeys by swiping debit or credit cards. At least in time for the London Olympics, bus users will pay by swiping contactless credit cards and all public transport payments including on trains will be made this way within 18 months.

In New York, a transit authority consultant’s report shows the error rate for its version of HOP named the MetroCard is 20%. That’s a shocking one bad swipe out of every five.

Not surprisingly, the city’s transportation authority has announced the phasing out of the MetroCard by 2015 describing it as becoming obsolete technology.
The first replacement trial was allowing you to get a ride with the tap of a credit card. Contactless readers were placed in 80 fare gates at 30 stations on the Lexington Avenue train line. During this trial all MasterCard PayPass cards were accepted.

A simple tap of your card, key fob, or mobile phone is all you need.

Those PayPass cards are expected to be available here in time for the RWC2011 at 3 stadiums but of course not for public transport.

The MTA says it will save hundreds of millions of dollars a year in labour and material costs associated with selling and distributing the MetroCard and prevent scam. It presently costs 18c in fare collection for every dollar it makes.

Google has unveiled mobile phone payment system which will let payments be made on an Android phone using a credit card number or a pre-paid card.

In Taiwan, commuters can use their handsets to pay for subway and bus fares, as well as parking fees at government-run parking lots.
So we are seeing with HOP the introduction of a 20th century system - one that at the moment you can’t even top up online, a frustration I over-hear many times in HOP discussions. Of course that is in the eventual plan but it shows how we are now in a world where doing things online and using our mobile is the norm, not queuing at ticket offices or visiting a specified dairy to update our card.

This week I am in Australia zipping around an inner-city rail link. That is something our Transport Minister has denied Auckland funding for in last week, wanting us to stick with a 1960s motorway and roading solution using buses. I am reading facebook messages from two friends who are during their holiday zapping around European cities in fast-speed trains.

Other countries are getting 21st century solutions. Like the HOP card, we are getting 20th century solutions and I worry we may not be moving on from that for decades.

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13 Comments

 
  1. Andy says:

    Credit Card method is brilliant, used it everyday for the past 4 years. It IS very similar to the HOP card, you just don’t have to top it up and it charges your account for the amount you have used each month.

    But HOW ON EARTH is that phone method faster than swiping your wallet with your transport card inside on your way through. First of all you have to make sure your phone is on and unlocked, not to mention all that texting stuff. What if you have no battery or no phone? This is fine for non-regular commuters but to use it at as a replacement would be taking an enormous step backwards.

  2. JC says:

    The credit card scheme is supplementing Oyster in London - not replacing it. TFL want to get out of the fare collection business, but they won’t be doing it for a few years yet.

  3. Jon Reeves says:

    Meanwhile, here in Basel, Switzerland, I simply buy a monthly pass for 70 francs (NZ$100) per month and can use any tram (from both tram companies), bus or local train in the city. No swiping, no showing passes to drivers etc…just plain, old school, simple, effective and everyone does it here.

    New technology is great, but sometimes organised old tech works extremely also.

  4. kel says:

    I like Chinese cities such as Qingdao, Dalian, Yantai to name a couple where trips cost $0.20 in cash or get a transport card and you even get a discount!. Load NZ$10 at a random counter somewhere near where you are, then use it for months (costs $0.18 per ride, no matter the distance). Pretty easy! Can’t complain about any hassles with that… if u run out, just put 20 cents in the tin box!

  5. Cam says:

    Metrocard is obsolete, it’s the old magnetic strip type card like Sydney has and London had pre Oyster.

  6. Jeremiah says:

    Dude - I hate to break it to you but NZ is always behind the times on infrastructure - nothing is ever built properly & new projects are always half done & not enough money is ever invested. Sadly, it seems to be the Kiwi’s lot in life.

  7. Andrew says:

    Any specific level of technology gets obsolete pretty quickly, but in HOP’s defense, the technologies mentioned here are not fair comparisons. PayPass is the same technology implemented a different way (and under the complete control of a credit card company, do we want that?), and mobile NFC is in it’s infancy. Visual barcodes are passive and clumsy for fast commuter boarding, and lack of Internet payments is because the balance is physically stored on the card itself - when topping up online with Oyster you need to nominate a pickup point (like a specific tube or train station) to collect your credit. Hop stage 1 and Snapper have no such fixed pickup points as the readers are all on moving buses.

  8. Matt L says:

    One other thing to consider is that one of the benefits to AT with the Thales system that will go online later in the year is that AT are in control of the float, that means they will be in control of all of the money stored on Hop cards and therefore will earn interest off it and will be able to use it to leverage other finance.

    My understanding is that this is one of the key reasons AT went with Thales and not Snapper even though Snapper offered its system for free. In the long term the system works out better for AT.

  9. James B says:

    You can already buy Android phones with near field communications. In theory if they come up with a standard for the technology there is nothing to stop NFC being put into phones, cards, tablets etc.

  10. Joshua says:

    The beauty about the Thales and AT’s system is that it’s open for other companies to create their products, so we may yet get a credit card company who brings a tap and go like card to our system.

    Also I’m not a fan of the way those mobile payments are made, it will be better when near field communtication is brought to the phone like some of the android phones already hitting the market.

  11. Cam says:

    @Jerimiah - don’t think you are “breaking” anything to anyone. Nobody here is under any illusions.

  12. Commuter says:

    I don’t care if now I can buy things in stores with it. I already have an eftpos card for that! All the fare discounts were already available. I hate that now I have to pay a fee to load it (where are those promised self serve machines). And I really, really find it extremely annoying to have to “tag-off”. I agree with John Reeves, it is not about being old or new tech, is how well it is designed. Yes, I’d like to have a single card for all companies. We need a better system, but this is not it.

  13. Jon C says:

    I wrote about mobile payments for smart transport cards back in June http://www.aktnz.co.nz/2011/06/05/hop-card-already-old-school/

 

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