Four insights from Transport Ticketing Global
EMV, MaaS, Uberising congestion and data immaturity
After a year’s absence, we were back at the Transport Ticketing Global Conference in London. This event is a major one in the industry. It’s the world’s largest forum for smart ticketing and mobility, gathering over 1,200 transport professionals from 65 countries. It has been the go-to event for this industry for the last ten years.
Snapper CEO Miki Szikszai was among the speakers, and you can read the details of his presentation here.
Building healthy relationships with data and design was based on a case study of how Snapper helped Greater Wellington Regional Council address challenges with a major new bus network re-design. The blog also outlines the invite-only breakfast we hosted with our partner, Vix Technologies, and the unveiling of the Snapper SmartWare iOS app.
The event itself is always a great opportunity to take a closer look at what’s happening in the public transport industry. This year, we came away with four valuable insights about the sector.
1. EMV and Account-based ticketing
For the past decade the transport ticketing industry has been navigating how to best introduce the use of bank-issued debit and credit cards, also known as Europay Mastercard Visa (EMV). Transport For London are the global leaders and the pioneer of EMV usage in this sector, really pushing the idea of doing away with transport cards in favour of bank cards. At this event in 2012, TfL’s vision was that EMV would replace the Oyster card completely by 2014.
The arc of Transport for London’s journey has been a genuine strategic case study for the industry. From being an early adopter, Transport for London have understood that there are clear roles for both the existing Oyster card and EMV. There is a significant majority of passengers in London who require concessionary fares, operate in a cash economy and are budget conscious who will not use EMV. Oyster cards are not going away – Transport for London are issuing up to 30,000 Oyster cards every day. There were 9 million new Oyster cards issued in 2019 alone and there is plenty of life left in that service. Transport for London updated the market to say that as a result they see a future for Oyster for another ten years, and that Oyster will continue to meet a wider set of customer needs than EMV over this time. Importantly Transport for London have made the policy decision that concessions will not be supported on EMV.
The role for EMV is also becoming clearer. It meets real needs for occasional travellers, tourists and regular commuters who are not budget constrained. It provides unparalleled convenience. Transport for London continue to see the two as complementary – it’s an ‘and’, not an ‘or’.
The National Transport Authority in Ireland have the Leap transport card, and for many years there have been discussions about replacing it with an EMV-based system. However, as a further example of transport card and EMV systems co-existing, the discussion has now turned instead to how the Leap card’s capabilities can be extended to support account-based ticketing, with an EMV overlay implemented as an extension.
EMV was initially seen as a way to reduce operating costs. However, since EMV has only been deployed to date where card-based systems are already in use, the challenge is in fact managing two cost structures at the same time. This therefore requires a clear business case that the deployment of EMV increases ridership. This is a high hurdle as the evidence from existing deployments is that EMV is taking transactions from other ticketing methods, as opposed to growing the overall use of public transport. The proven business cases to date focus on a phase-in of EMV alongside existing ticketing methods, targeting underserved customers of the transport network.
This has important implications for procurements. A significant topic of conversation was the collapse of the Transport for the North procurement for a complex multi-region account-based system. Originally designed to replace existing systems in the north of England, after two and a half years of industry engagement a key part of the procurement has been cancelled in favour of extending existing regional card systems with an EMV overlay. This is a clear signal that the business case for providing improved customer experiences is more likely to be successful when based on an existing system that is extended to provide EMV and account-based ticketing.
2. Mobility as a Service (Maas) – a solution looking for a problem?
Several years ago, the MaaS trend saw a variety of systems come into cities in an effort to reduce dependency on single occupant vehicles. eScooters, Uber, Lift, cycle hire – they were all represented and each one came with an app.
There was a lot of industry hype around the idea of merging them all into one ‘super app’, a full realisation of the MaaS vision. The reality is that MaaS has hit the peak of the hype curve and is losing steam. In other words, the consensus now is “what’s the ACTUAL problem we’re trying to solve here? Is there one?”. There was an insightful presentation from Transport for the West Midlands and their MaaS programme. This programme has been in flight for over three years now and it is clear that in a funding-constrained environment that there is no business case for this type of solution.
Having multiple apps on a smartphone is not up there with major concerns such as traffic congestion, or public transport systems that are overloaded. The industry focus is moving from using MaaS to replace single occupant vehicles (PT is the key lever for this) to seeking out areas where friction can be reduced (e.g. Park and Ride).
3. Uber – not an ally for transport authorities
Uber was originally positioned as a solution to help urban transport become more flexible and reduce congestion. Now that it’s been around for a few years, cities are noticing the opposite – Uber is adding to the problem. At previous editions of this conference Transport for London identified Uber and Amazon as the two major causes of traffic congestion in the city.
Uber positions itself to attract the public subsidies that cities use to spend on public transport – which, of course, is not a good use of their resources. Uber has a role to play in city transport, but the boundaries are becoming much clearer as cities seek to use Uber to provide service in areas where public transport networks are not available. Some in the American market continue to engage Uber with an approach that public transport tickets can be bought using the Uber app, using Uber to improve distribution for ticket sales. Denver is a good example of a city that does this, and the industry is watching closely to see how this collaboration unfolds.
4. An increased focus on the use of data
Improved use of data to drive decision-making will increasingly be key for public transport providers meeting their objectives. From Transport Ticketing Global our impression of general trends around data are that:
- Some organisations don’t have the data
- Some organisations have the data but don’t know what to do with it
- Some organisations wish they had more data, are collecting as much as they can, but don’t have an overall strategy
However, the sector is in the early stages of its developing capability with using data well. There is still a way to go before it is used consistently to drive good evidence-based decisions for improvement. There is a risk that some authorities can be captured by advanced techniques such as machine learning when traditional approaches can provide the same insights more easily. It is very important to grow your data capability in a managed way, and provide clear value with each step
All in all, the conference was again a well-attended and highly valuable event, with quality presentations, lots of insights, and the chance to catch up with people in the industry.
Parts of image created from London Skyline Vectors by Vecteezy