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Electronic ticketing: the difference it makes

Posted: 24 June 2005 | Tony Yeung, Chairman, Commission on Information Technology and Innovation, UITP | No comments yet

Electronic Ticketing (ET) systems have been implemented for years in major public transport networks, whether in Europe (London and Paris), in Asia (Hong Kong and Singapore) or in South America (Santiago de Chile) and many companies around the world intend to follow this path. But now that these systems have been implemented, can it be claimed that smartcards improve the efficiency and quality of the network? What are the benefits of ET for public transport authorities, operators and most importantly, passengers?

Local (and regional) authorities are nowadays faced with complex mobility issues. Their constituents expect them to find innovative, quick and affordable solutions to the massive problem of congestion, which has become a common situation in any city around the world. To this end, it appears that ET is a unique opportunity to achieve mobility in cities. ET systems are indeed the easiest way to create seamless journeys in public transport networks: passengers can hop on a bus, then take a local train or use the metro with the same ticket, but they can also change operator without even realising it. Transport authorities are then able to offer a unified fare media model, upgrading not only the efficiency but also the image of the transport network of their area of influence. In the same vein, they can introduce flexible and more complex tariffs, making a difference in fare prices for passengers travelling during peak hours or off peak hours, for instance. Citizens who are granted special rights, like students, elderly or disabled people, are also assured to benefit from a fare adapted to their situation.

Electronic Ticketing (ET) systems have been implemented for years in major public transport networks, whether in Europe (London and Paris), in Asia (Hong Kong and Singapore) or in South America (Santiago de Chile) and many companies around the world intend to follow this path. But now that these systems have been implemented, can it be claimed that smartcards improve the efficiency and quality of the network? What are the benefits of ET for public transport authorities, operators and most importantly, passengers? Local (and regional) authorities are nowadays faced with complex mobility issues. Their constituents expect them to find innovative, quick and affordable solutions to the massive problem of congestion, which has become a common situation in any city around the world. To this end, it appears that ET is a unique opportunity to achieve mobility in cities. ET systems are indeed the easiest way to create seamless journeys in public transport networks: passengers can hop on a bus, then take a local train or use the metro with the same ticket, but they can also change operator without even realising it. Transport authorities are then able to offer a unified fare media model, upgrading not only the efficiency but also the image of the transport network of their area of influence. In the same vein, they can introduce flexible and more complex tariffs, making a difference in fare prices for passengers travelling during peak hours or off peak hours, for instance. Citizens who are granted special rights, like students, elderly or disabled people, are also assured to benefit from a fare adapted to their situation.

Electronic Ticketing (ET) systems have been implemented for years in major public transport networks, whether in Europe (London and Paris), in Asia (Hong Kong and Singapore) or in South America (Santiago de Chile) and many companies around the world intend to follow this path. But now that these systems have been implemented, can it be claimed that smartcards improve the efficiency and quality of the network? What are the benefits of ET for public transport authorities, operators and most importantly, passengers?

Local (and regional) authorities are nowadays faced with complex mobility issues. Their constituents expect them to find innovative, quick and affordable solutions to the massive problem of congestion, which has become a common situation in any city around the world. To this end, it appears that ET is a unique opportunity to achieve mobility in cities. ET systems are indeed the easiest way to create seamless journeys in public transport networks: passengers can hop on a bus, then take a local train or use the metro with the same ticket, but they can also change operator without even realising it. Transport authorities are then able to offer a unified fare media model, upgrading not only the efficiency but also the image of the transport network of their area of influence. In the same vein, they can introduce flexible and more complex tariffs, making a difference in fare prices for passengers travelling during peak hours or off peak hours, for instance. Citizens who are granted special rights, like students, elderly or disabled people, are also assured to benefit from a fare adapted to their situation.

This restructuring of the tariff schemes and the general introduction of ET is of course the source of new marketing data, which transformed into new marketing policies, will offer rapid and positive results. If customers are encouraged to switch to e-tickets (in situations where e-ticketing introduction is partial or gradual) through fare policies allowing direct financial benefits, they will quickly adopt the new system and make it a success. Finally, smartcards give the authorities an opportunity to extend the scheme to other players in the urban transport sector, such as taxi operators or car-sharing providers. It is therefore one of the key elements to achieve sustainable mobility in the cities of today and tomorrow: one of the greatest challenges of the moment.

The added-value of ET for authorities is also synonymous with advantages for operators, but there is in fact even more in store for them. First of all, adopting a modern approach towards mobility means the possibility to gain new customers, who will be seduced by the faster and improved service provided using e-tickets. Increasing speed at boarding, whether on buses or trains, is indeed one of the direct advantages of e-ticketing, hence offering a solution to a major issue for operators. But in general, thanks to ET systems, sales organisation becomes more flexible and simple. Operators are made aware of their passengers’ activities and habits through the detailed analysis of the travel patterns enabled by the system. They are also made aware of their actual needs to which they can react rapidly to match these requirements. Inspection also becomes simpler with smartcards. It can be done electronically with devices reading the information stored on the chip of the cards, and automatically checking its validity. At the same time, the number of the smartcard is compared to those on a hot list compiling numbers of all lost, stolen or misused cards, which implies immediate confiscation if numbers match.

In financial terms, ET makes a significant difference. Operators are able to increase their medium term operating profit, shun the cash away and control their cash flow availability. Moreover, moving from mechanical to electronic devices means drastic reduction of maintenance costs, just as an improvement in the distribution of network costs: each company participating in the scheme gains back revenues corresponding exactly to the number of passengers transported.

Additionally, e-ticketing is a valuable opportunity for operators to provide new services to their customers. Services, such as parking fees or congestion charging, are a way to make new revenues but also a strategy to retain customers and attract new ones. Multi-application smartcards offering non transport related services become an incentive for passengers to connect with public transport more often. Their means of payment (e-purse) for transport also becomes a key to enter buildings, a loyalty card or a convenient way to access any other public service. As a smartcard provider, the public transport sector can even be considered a leader in the field of multi-application. And in this area, new applications are only limited by imagination.

Last but not least, the electronic revolution brings many advantages to the passengers, who have proven to be rapidly taken-in by the added value e-ticketing gives them. Indeed, they see smartcards as convenient and fast and enjoy the fact that cash is no longer required when using them. ET means the end of queuing up to check in the vehicle or the platform, or rummaging through one’s belongings to find the magnetic pass: all that is needed is to swipe the bag or purse containing the smartcard over the card reader and the gate will open immediately. Recharging the card also becomes a time-saving exercise: ET offers easier ways to top-up or renew passes. Customers have access to automatic machines from which they can add the value they wish to the card. In some cases, cards can even be automatically reloaded every month by bank transfer, but a contract must be signed with the operator.

Yet another major advantage for public transport passengers is that even though they lose their card, they never lose money. Their data – such as prepaid travel – is kept in a central database and can be easily transferred onto a new card. This makes life easier for those who have been an unfortunate victim of crime, but also for passengers with their head in the clouds!

To conclude, it is obvious that customers greatly appreciate the additional non transport related services provided through their smartcard by operators and authorities. Having a single medium to realise several common daily transactions is indeed considered as a step forward.

In short, whether it is at the level of authorities, operators or passengers, e-ticketing is the solution for future-oriented public transport mobility. But now that ET systems are developed worldwide, a challenge remains: standardisation. Harmonisation of smartcard systems is the key to reduce the costs involved with contactless technology and will simplify the life of holiday-makers and (international) travellers.