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Smart card questions move from technology to applications

01 Mar 2000

The 5th UITP fare collection conference in Bologna on February 2 - 4 signalled a turning point in the prospects for widespread use of smart cards. No longer were delegates asking if the technology was ready; now the key question is the best management and operating structure to meet individual customer needs. Chris Jackson reports

'I am not interested in standards - what I want is the best system that will meet the needs of my customers. The smart card is only a means to an end. I don't want smart cards because I like technology, I want them to earn more money and deliver a better service to my customers.'

With this provocative challenge to the delegates and manufacturers at the International Union of Public Transport's fifth conference on Automatic Fare Collection, Berlin Transport Authority's Stefan Kissinger summed up the turning point in the smart card debate. After almost 10 years of proposals and pilot projects, the question is not whether the equipment will work reliably, but how best to structure and manage the applications to get the most benefit from such a powerful tool.

Paris Transport Authority's IT Director André Ampelas, who chairs the UITP commission on information technology, warned in his keynote address that the public transport industry is facing 'a transition from a supply-focused to a demand-focused world.' He highlighted the ability of smart cards to handle much more than simple fare collection as a prime example of 'putting engineering at the service of customers'.

Ampelas noted that many cities were moving straight from paper tickets or tokens to smart cards, jumping over the magnetic strip generation of AFC equipment, but he warned that 'not all systems are the same; the impact on the quality of service is different, and not always related to the cost of the system.'

With over 7·5 million cards in operation, Hong Kong's Octopus remains the principal proof of smart cards for multi-modal fare collection. It may not meet either of the ISO14443 A and B communications protocols being widely promoted, but the Sony card used by Octopus has now been agreed as the future Japanese standard by a forum of city and regional operators. Creative Star Director Brian Chapman says the joint venture company is also seeking approval this year from the banking authorities to venture into electronic purse applications.

Pilots move to takeoff

Across Europe, a number of pilot schemes are about to bear fruit. RATP is due to award a contract this month for full smart card installation, following trials by 40000 staff over several years. Tenders were evaluated at the end of January, and RATP's aim is to have most of the hardware in place this year. All 3 million annual seasons will be converted to smart cards by the end of 2001, followed by monthly and weekly tickets. Magnetic tickets will be retained for single trips at this stage.

As part of the transition, RATP is looking to move away from traditional ticket offices at metro stations to ticket issuing via agencies, telesales, vending machines, and the internet. Many offices will become customer service centres, with staff redeployed to a wider remit. As smart card usage data is collected, the operator will be able to develop 'personalised contracts' with each passenger, tailoring services and marketing offers to meet the needs of smaller and smaller groups.

RATP is a prime player under the Calypso programme which includes projects in Venezia, Konstanz and Lisboa, testing common standards in a range of different applications, with transport, building security, electronic purse, local authority services, telecommunications, and a host of other options under consideration.

The world's third busiest metro in Mexico City, with over 5 million passengers a day, is looking to replace its fare collection system as soon as possible. STC has put together its business case, based largely on the cost savings from eliminating maintenance of its ageing mechanical turnstiles, but needs to get formal approval of the capital investment budget before tenders can be called later this year. The payback period is estimated at under three years.

STC has seen a sharp increase in fraudulent travel following a political decision last year to introduce free rides for senior citizens and handicapped people, and the first stage of the smart card programme would be targeted at these users. Eliminating the existing 'courtesy doors' would reduce the scope for other users to access the network without paying - STC has seen revenue fall by around 400000 passengers a day since last year.

According to a survey by Schlumberger Technologies, there were over 1·4 billion smart cards in use around the world by the end of 1999. By far the majority are used for payphones, mobile phones and other IT applications, with only 25 million in transport and 135 million for banking applications. But transport and banking are seen as two of the key industries where smart cards have a huge potential.

The advent of dual-application cards is allowing the convergence of the contact cards used for banking and e-purse with the contactless variety favoured by transport operators for more rapid transactions. ISO standards for both versions are taking shape, although there are already two ISO 14443 communications protocols for contactless cards and at least one more in the offing.

One of the highlights at Bologna was the wide range of ancilliary applications being considered as accompaniments for the basic smart ticket. An electronic purse holding cash for minor purchases is a common option, as are parking meters and road toll credits. Some Italian municipalities are already issuing 'city cards' giving their residents access to social services and museums as well as transport.

The multi-operator solution

The increasing restructuring of public transport is also impacting on the smart card market. As cities move to competitive tendering of services, the fare collection system must be able to distribute revenues accurately amongst a range of operators.

Berlin's BVG, S-Bahn Berlin and Verkehrsverbund Berlin-Brandenburg began a six-month trial on October 1 using equipment from the ERG/Motorola alliance. Marketed as 'tick.et', the cards are being used by 27000 passengers on two U-Bahn, one S-Bahn, one tram, and two bus routes, with equipment on 32 stations and 34 vehicles. There are no fare gates; passengers must 'check-in' and 'check-out' at free-standing validators at each end of a trip. Following an evaluation in September, a decision whether to proceed is due at the end of this year.

Smart cards are due to be added to London Transport's Prestige fare collection project from next year, and the TranSys consortium called tenders in January for the key components. Partners Cubic Transportation Systems, EDS, ICL and WS Atkins will be providing a central card distribution and management service, including data centre and revenue clearing house, call centres and customer help lines. TranSys has also published its full specifications, with the aim of encouraging other British operators to piggyback on the system.

The Integrated Transport Smartcard Operators group led by Greater Manchester PTE, local bus operators and Britain's Department of the Environment, Transport & the Regions, is also working on a multi-operator standard. Following several trials and project definition, the ITSO implementation specification is expected to be ready in May.

British bus and rail operators First Group and National Express have now bought into the ERG-Stagecoach- Sema joint venture Prepayment Cards Ltd. First Group has five pilot projects in hand. PCLis currently looking at the possibility of teaming up with an existng cash card company to provide e-purse and banking facilities.

Plans are also firming up for the proposed national transport smart card in the Netherlands, which is scheduled to replace the existing Strippenkart from 2002. Described by Mobis project manager Niek Van Trigt as the 'search for the Holy Grail', the Dutch project will pull together 35 regional transport authorities, 20 bus, metro, and rail operators, and the national railway. Van Trigt stressed that the questions were more about the decision making process than the technology, looking for a logical split of responsibility between authority and operator that allows local control, a range of fare structures, through-ticketing benefits, and commercial incentives for encouraging ridership.

Specifications have been completed for a smart card scheme covering the greater København region, but these are now being further developed to embrace the national rail network. As the capital's S-bane is one of its biggest operations, DSB sees benefits in using the same technology for the rest of its services too.

North American operators have been more cautious in their approach; only in the mid-1990s did New York and Chicago finally move to magnetic stripe ticketing. Their results have been very positive, but project manager Tom Savage confirmed that NYCT is already looking at adding smart card capability to its US$690m installation over the next five to 10 years. Toronto Transit Commission is also looking at harnessing the potential of smart cards in the future. Once again, it is the ability to handle multi-operator ticketing that is driving US interest, notably for the Bay Area TransLink project (p171). n

Fare Collection News In Brief

Siemens has been testing its SCET (secure contactless electronic ticketing) technology with Verkehrsverband Rhein-Sieg in Köln and Bonn, and will be using the same system for the Dresden intermobil project. SCET is compatible with both ISO 14443 A and B communications protocols, and has full Mifare capability. Siemens has a letter of intent for the Swiss Easy-Ride smart card scheme, which will start with pilot trials in Genève and Basel. Easy-Ride is to be a 'hands free' system using 868 MHz short-range radio; all cards will be polled continuously while a vehicle is in motion, with fares calculated and deducted automatically.

Formed two years ago to provide a range of smart cards specifically for the transport market, French group ASK has developed a low-cost memory card for single trips or carnets of up to 10 rides. By eliminating the scope for recharging, this avoids any need for security, bringing the cost below Fr0·5 per card. The memory cards are due to be tested by RATP on the Montmartre funicular in May. Reflecting the rapid growth in European smart card projects, ASK expects to double its turnover from Fr20m in 1999 to Fr40m this year.

French smart card supplier Gemplus will be unveiling its new GemFare system architecture this month. This comprises six interoperable modular blocks, covering ticket issuing, reloading, transaction management, processing, security and card management, which can be assembled in a variety of ways to create a tailor-made fare collection system.

Turkish municipal IT specialist BelBim has developed an integrated ticketing solution for the metro, light rail, rail, bus and ferry operations in Istanbul. Akbil is a contact system, with the processor enclosed in a steel-cased 'I-button', which can be attached to a pass, keyfob or even a watch strap; the button is inserted into a docking port to trigger the transaction. Similar ports are available on recharging machines, and on information terminals where passengers can check their value and journey data. Akbil is being used by 2·5 million passengers at over 5000 transport terminals and 342 Pepsi vending machines.

Belgian gate specialist Automatic Systems has supplied 400 gates to ERG for use on the Metrovías network in Buenos Aires. The company is also supplying gates for Manila, Shanghai, Lisboa and Barcelona.

On January 31 Motorola unveiled its latest contactless smart card; the M-Smart Mercury MM4000L. A contactless version of the M-Smart Venus dual-interface card launched last year, it is the first contactless card with Application Specific Integrated Circuit technology to achieve ISO 14443B compatibility. It has a built-in DES encryption engine, which provides high security and a processing time of less than 100 ms.

Austria's Philips Semiconductors is developing its Mifare chip into a multi-application platform using hard-wired logic, based on the ISO14443A communications protocol. Philips is developing paper based tags for IATA-compatible baggage tags which could offer low-cost single-trip tickets for smart card applications.

ST Microelectronics is a leading supplier of dual-interface cards, and will provide ISO14443B cards to ERG/Motorola for the San Francisco trial this year, and for the project in Singapore due to come on stream next year. The ST19RF08 microcontroller allows easy secure switching between multiple applications.

Israeli supplier Transway, which has provided over 4000 ticket machines to national bus operator Egged, is preparing to enter the emerging light rail market, and looking at proposals to develop through bus-rail ticketing between IR and Egged.

CAPTION: RATP staff testing the smart-card based MaxiPass under the Calypso project are already able to make use of electronic purse functions at selected retailers

CAPTION: The M-Smart Mercury M4000L smart card launched by the ERG/Motorola alliance in January features hard-wired triple-DES security

CAPTION: Launched in April 1995, the Akbil 'I-button' from Turkish IT specialist BelBim is now being used by 2·5 million passengers at over 5 000 terminals throughout Istanbul