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The Future of Public
Transport Ticketing
Mike Burden
Principal Consultant
Consult Hyperion
Agenda
2
• Technology
• Account Based Systems
• Sales and Distribution
• Transaction Model
• Costs
• Reader Design
• TfL I...
Ticketing technology has evolved significantly over the
last 100 years
3
Paper
Ticket
Smart Cards
& Tokens
2D
Barcodes
Cas...
There is a trend away from card based schemes
towards account based
4
SmartNon-Smart
AccountCard
Benefits of an Open System
5
Card Based Account Based
• ISO 14443
• Closed System
• Agency issues and manages own
media
• ...
Distribution of fare products is evolving from a
station centric approach to a mobile solution
• The majority still buy th...
Visa and MasterCard have agreed a
Transaction Model for Europe
General Contactless
Payment rules
Agreed new rules for tran...
Operating a card scheme is expensive
• Split of costs in TfL’s revenue collection system
8
41%
13%
32%
8%
6%
0%
20%
40%
60...
The Multi-Application Reader
• „Ideal‟ / modular architecture
• Designed for efficient re-certification
9
CPC usage has been steady in London despite limited
marketing
0
20000
40000
60000
80000
100000
120000
140000
0
5,000
10,00...
The Impact on the system is small but growing
fast
Oyster = 94.6%
Mag Stripe = 3.9%
Cash = 1.4
Contactless = 0.1%
22 Janua...
Summary -In future ticketing systems readers
will have a minor role
 Transition to Back Office centric rather than Reader...
Is “Payment Option” the 5th P of Marketing?
13
Tomorrow’s Transactions:
thought leadership from Consult Hyperion
Read www.chyp.com/media/blog
Listen www.chyp.com/media/p...
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The Future of Public Transport Ticketing

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The Future of Public Transport Ticketing

  1. 1. The Future of Public Transport Ticketing Mike Burden Principal Consultant Consult Hyperion
  2. 2. Agenda 2 • Technology • Account Based Systems • Sales and Distribution • Transaction Model • Costs • Reader Design • TfL Implementation • Summary
  3. 3. Ticketing technology has evolved significantly over the last 100 years 3 Paper Ticket Smart Cards & Tokens 2D Barcodes Cash Magnetic Tickets Contactless Payment Cards Public Service Cards & Other ID NFC Biometrics? Metal Tokens
  4. 4. There is a trend away from card based schemes towards account based 4 SmartNon-Smart AccountCard
  5. 5. Benefits of an Open System 5 Card Based Account Based • ISO 14443 • Closed System • Agency issues and manages own media • Proprietary systems and formats • Network of Add-Value Machines • External re-valuing networks require special POS devices • Fare calculations performed between card and reader • Complex Reader Management • Details stored on card • Fare changes require code changes on all validators • ISO 14443 • Open System • Master Account lives in the Back Office • card is only a token to reference the account • fare calculation rules execute in the Back Office • Assume card OK unless it is on the hotlist • updates must be frequent • Simpler validator architecture • no fare calculation • Non-payment cards can be used to identify account • ID cards • Campus cards • Ski pass
  6. 6. Distribution of fare products is evolving from a station centric approach to a mobile solution • The majority still buy their tickets from a station • It is possible to buy advance products on-line, but they are still fulfilled physically • Mobile plays a big part in future solutions: • Purchase • CPC‟s • Tokens • 2D-Bar Codes • NFC 6
  7. 7. Visa and MasterCard have agreed a Transaction Model for Europe General Contactless Payment rules Agreed new rules for transport PAYG Price is known before the card is presented Each tap is £0, then operator back-office calculates price at end of day Use of card counters to manage risk & occasionally fall- forward to Chip & PIN Operator manages risks to provide equivalent protection within the 500ms time limit: • Offline data authentication of card • Deny Lists (DLs) in terminals • Online authorisations from the back-office Terminal field is activated manually by store staff Terminal field is always active to maximise throughput 7
  8. 8. Operating a card scheme is expensive • Split of costs in TfL’s revenue collection system 8 41% 13% 32% 8% 6% 0% 20% 40% 60% 80% 100% Infrastructure & management Revenue protection Product sales Customer information & service Smartcard production & distribution 100% = 14p per £ of fares collected How much of this could be eliminated? Source: TfL Fares and Ticketing Directorate
  9. 9. The Multi-Application Reader • „Ideal‟ / modular architecture • Designed for efficient re-certification 9
  10. 10. CPC usage has been steady in London despite limited marketing 0 20000 40000 60000 80000 100000 120000 140000 0 5,000 10,000 15,000 20,000 25,000 13/12/2012 20/12/2012 27/12/2012 03/01/2013 10/01/2013 17/01/2013 24/01/2013 31/01/2013 07/02/2013 14/02/2013 21/02/2013 28/02/2013 07/03/2013 14/03/2013 21/03/2013 28/03/2013 04/04/2013 11/04/2013 18/04/2013 25/04/2013 02/05/2013 09/05/2013 Use of contactless payment cards on TfL buses since launch Journeys Cards Used Cards used for the first time Rolling week's journeys (right axis)
  11. 11. The Impact on the system is small but growing fast Oyster = 94.6% Mag Stripe = 3.9% Cash = 1.4 Contactless = 0.1% 22 January 2013 51,402 different contactless payment cards have been used on 8,534 buses 22 January 2013
  12. 12. Summary -In future ticketing systems readers will have a minor role  Transition to Back Office centric rather than Reader centric  Readers will simply authenticate the credential  Payment transactions will be processed in the background  Passenger devices could be any contactless device they have: • Payment cards • Mobile wallets • ID Cards  Integration will be underpinned by national & industry standards  Schemes will need to be able to support a multitude of payment methods that passengers want to pay with, there will be no “winner” 12
  13. 13. Is “Payment Option” the 5th P of Marketing? 13
  14. 14. Tomorrow’s Transactions: thought leadership from Consult Hyperion Read www.chyp.com/media/blog Listen www.chyp.com/media/podcasts Visit www.chyp.com Contact info@chyp.com Follow @chyppings Contact Details 14 Mike Burden Principal Consultant Consult Hyperion (M) +44 7976 951 161 (T) +44 1483 301 793 (e) mike.burden@chyp.com

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