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Smartphone applications in transit services: Growing popularity [free access]

May 1, 2014

 

The smartphone is well on its way to becoming the bestselling electronics product in the world. In fact, between 2012 and 2013, worldwide smartphone sales increased by around 43 per cent; and in 2013, worldwide sales of smartphones surpassed sales of the basic-feature phone devices for the first time. With the increasing popularity of smartphones and availability of Wi-Fi infrastructure and services, various sectors are developing applications (apps) to better connection with customers. Interestingly, the transit industry presents a prime example of a sector that has benefitted from the proliferation of smartphones.

 

Industry trends suggest that transit system operators are moving away from traditional methods of payment, such as cash and paper tickets, towards a variety of electronic payment methods, including near field communication (NFC)-based mobile ticketing.  

 

Smartphones are also being used in the transit industry for payment of parking fees, purchase at retail outlets, providing real-time service information to customers, displaying interactive route maps and service schedules, reporting maintenance condition, sounding alarms in case of emergency, accessing Wi-Fi at stations and in trains; etc. Many transport providers across the world are providing free access to the internet to allow passengers to manage personal ticketing accounts, buy and reload tickets, view transaction history, and access real-time vehicle schedule information.

 

Box 1 provides a brief introduction to the NFC technology.

 

Box 1: An introduction to NFC

 

NFC is a short-range, low-power, wireless technology that allows data transfer when two devices (technology enabled) are tapped or held in close proximity (less than 10 cm). The NFC chip is an embedded secure integrated circuit which enables contactless transactions. It may be used for smart cards, mobile phones and other electronic devices, which can be carried easily (such as key chains, USD flash drives, and toys).

 

NFC has evolved from the existing radio frequency identification (RFID) technology, which is well-established in its use for mobile payments and ticketing. The technology is essentially different from Bluetooth as it does not require a pairing code to facilitate transfer.

 

Source: Global Mass Transit Research

 

Types of mobile ticketing

 

Currently, there are two main types of mobile payments:

 

 

Ticket-delivery schemes may use the mobile phone network to transmit either a text message description of a purchased ticket (SMS ticket) or a bar-coded ticket, which can be scanned at the reader installed on buses or handheld devices with ticket inspectors. To purchase mobile tickets, passenger may have to send a message to a certain number to receive the payment receipt and the ticket.

 

Advantages and disadvantages

 

Box 2 indicates the key advantages and disadvantages of smartphone-based ticketing.

 

Box 2: Comparative analysis of smartphone ticketing

Advantages

Disadvantages

  • Does not involve any costs for card manufacture

 

  • User friendly and easy to carry

 

  • Ability to integrate with real-time passenger information system, onboard Wi-Fi and other services
  • High mobile phone and service charges for the passenger

 

  • View is limited by size of mobile phone display screen

 

  • Potential compromise in security

 

  • Low battery and/or no network availability could inhibit purchase of tickets or ability to validate the ticket

 

  • Bar-coded tickets require a more costly and less robust reader than a smart card reader

Source: Global Mass Transit Research

 

Table 1 lists some cities where smartphones are used for public transport fare payments.

 

Table 1: Cities using smartphones for fare payments (partial list)

Fare medium

Cities

Mobile point-of-sale

solutions (mPOS)

Bucharest, Cardiff, Copenhagen, Dallas, Edinburgh, Frankfurt, Helsinki, London, Madrid, Milan, Moscow, Munich, Nairobi, Osijek, Prague, Stockholm, Szczecin, Vienna, Zagreb

Integrated NFC

Bangkok, Beijing, Boston, Bucharest, Caen, Chicago, Dubai, Florence, Frankfurt, Guangzhou, Hong Kong, Kuala Lumpur, Moscow, Nairobi,

New Jersey, Novosibirsk, Osijek, Oslo, Portland, Singapore, Strasbourg, Tokyo, Wellington

Source: Global Mass Transit Research

 

Smartphones as smart wallets

 

Smartphones are also being used as e-purses and smart wallets, wherein money is loaded in a customer account through a transfer of funds from a bank account. This transaction is typically online and PIN-protected and is similar to a cash withdrawal from an ATM. The e-purse or smart wallet can also be used to pay parking fees and make retail purchases.

 

Google Wallet is a special mobile payment system developed by Google that allows users to store debit cards, credit cards, loyalty cards, and gift cards among other things, as well as redeem sales promotions on their Android mobile phone. Users get instant notifications on their phones when they have made a purchase.

 

Currently, New Jersey Transit accepts Google Wallet payments on bus lines 6, 43, 80, 81, 87, 120 and 126 (near the farebox), and at Newark AirTrain station (AirTrain access). Google Wallet is also accepted at ticket vending machines and at ticket windows in New York Penn station and at the Port Authority Bus Terminal.

 

Other smartphone applications

 

Transit service providers are introducing various smartphone-based applications to enhance passenger experience. Some of the key examples are provided in Table 2.

 

Table 2: Key smartphone apps for the transit industry

Apps

City

Description

I-ride

New York

It provides information on bus services throughout New York.  It includes departure times, pricing, the distance to the nearest bus stop, maps, and advisories.

City Transit

New York

It uses official maps and a GPS-based station finder combined with live service advisories to help navigate the New York City subway and bus systems.

Subway Time

New York

It provides real-time train arrival estimates for all stations on the L, 1, 2, 3, 4, 5 and 6 subway lines and S 42nd Street Shuttle in New York City.

Weekender

New York

It provides information about weekend service changes caused by subway track work in New York City.

NextbusDC

Washington DC

It uses real-time GPS tracking to calculate bus arrivals, stop locations, and route maps in Washington DC.

DC Metro Rails

Washington DC

It provides real-time train arrival information and rail alerts for Metrorail.

CharmCity Circulator

Baltimore

It provides vehicle location information, maps of relevant bus routes, estimated arrival times for buses, important transportation updates as well as a guide to nearby points of interest

MARTA

Atlanta

It allows the user access to all bus and rail schedules and maps.

Ride CATS

Charlotte

It provides schedule and vehicle arrival information.

Transit Tracks

Chicago

It provides bus and train times, maps features and provides ability to bookmark the user’s most commonly used stops.

TransitGenie

Chicago

It is a personalised real-time multi-modal navigator for public transit. It provides step-by-step instructions on using the CTA, Metra and Pace transit systems.

Los Angelbus

Los Angeles

It provides vehicle location and arrival information of buses using GPS data.

Miami-Dade Transit

Miami

It provides information related to Metrorail trains and Kendall Cruiser buses on the iPhone. Users can access schedules, real-time passenger information, route information, fare details and the status of elevator and escalator services at the Metrorail and Metromover stations.

Tiramisu

Pittsburgh

It provides real-time schedule information for the transit system (Port Authority of Allegheny County) in Pittsburgh. The app is funded by the federal government’s Research and Innovative Technology Administration (RITA).

Portland Transit

Portland

It provides route information, maps, trip options

Routesy

San Francisco

It provides real-time schedule information for Muni, BART, Caltrain and AC transit systems.

SeattleBus

Seattle

It provides real-time arrival and departure information for buses.

Source: ITS America and Global Mass Transit Research

 

Region-wise trends

 

The use of smartphones in the transit industry is most popular in the European and North American region. NFC-based mobile ticketing is gaining prominence in these regions primarily due to the high penetration of smartphones, passenger demand for real-time schedule information, popularity of environmentally-friendly and convenient ticketing, availability of value-added services, high modal share of public transport, free onboard Wi-Fi service, etc.

 

To further explore the utility of smartphone apps, the European Union (EU) is funding a project, MobiCloud. The project aims to promote the use of mobile-based services in the cloud and support the emergence of a European ecosystem of mobile cloud-based apps. It is a collaborative platform for developing, deploying and managing mobile cloud apps for business-critical scenarios such as public transport, field service or construction. 

 

In its initial demonstrations, MobiCloud has developed an app for Swedish rail operator Tågkompaniet to allow maintenance staff to access a portfolio of services stored in the cloud. For Tågkompaniet, MobiCloud provides a resource visibility app (capability of finding the nearest colleagues), fault reporting app (allowing train drivers to document technical problems, attach pictures and assign to maintenance) as well as traffic disruption app (allowing staff to provide relevant information to passengers on board).

 

In Latin America and the Middle East and Africa (MEA), mobile ticketing in still at a nascent stage; however, it is gaining prominence with the ongoing development of modern public transport systems. In Latin America, Rio de Janeiro in Brazil became the first city to launch an NFC-based mobile ticketing pilot in October 2013. In the MEA, only two cities, Dubai and Nairobi, use mobile ticketing.

 

None of the cities in the Asia-Pacific region use mobile ticketing through SMS services. However, mobile ticketing based on NFC technology is gaining prominence in China, Japan, Malaysia, Singapore, and New Zealand.

 

Cities with advanced use of smartphones in transit

 

Oslo (Norway): The fare system in Oslo is integrated, zone-based and managed by Ruter, a common management company for public transportation in Oslo and Akershus. The mobile ticket app, RuterBillett, enables smartphone users to buy single tickets and period passes online. After completing the purchase online, the user has to visit one of the pick-up locations to download the ticket or the pay-as-you-go credit on the Travelcard, which is a plastic card for fare payment. Online purchases are still under a pilot programme; hence the number of pick-up locations is limited at present.

 

In September 2013, Ruter announced that its ticket app has been a success, with over 350,000 downloads since the launch before Christmas in 2012 and sale of over three million tickets. Currently, only one in five passengers buys tickets with the mobile app.

 

The Norwegian State Railways (NSB) also has a mobile app to sell tickets for its lines in the Oslo and Akershus region. Since its launch in February 2013, the NSB app has 80,000 registered mobile ticket buyers. The app is currently available for users with iPhone or Android-based phones only (not for Windows-based smartphones).

 

Frankfurt (Germany): The regional transport association, Rhein-Main-Verkehrsverbund (RMV), launched the HandyTicket NFC infrastructure in 2007. It allows riders to download single tickets and day passes (for individuals and groups) using the mobile phone. US-based Cubic Transportation System introduced a smartphone app and mobile ticketing solution for iPhone, Android, and Blackberry smartphones in October 2010. By June 2012, RMV had sold about one million mobile phone tickets through this app.

 

The HandyTicket system uses radio chip touch points, known as ConTag points. These are attached to the ticket machines at the busiest stations on the RMV network. The round plastic modules store passive data and provide the interface between the customer and the new ticketing service. The ConTag automatically activates the ticketing programme on the mobile phone and registers the departure point of the journey. It can be used to access real-time travel information on RMV’s website and to purchase tickets via the transport operator’s mobile website.

 

Deutsche Bahn (DB) launched the NFC-based Touch&Travel system in Berlin, Frankfurt, and Hamburg in February 2012, in partnership with Cardag Deutschland GmbH, NXP Semiconductors, Atron, and Giesecke & Devrient. It is available to the subscribers of Telefónica O2 Germany, Vodafone, and TMobile. Passengers present the NFC phone to a Touch&Travel touch point at the start and end of their journey. The fare is automatically calculated and charged to their DB account, which is settled on a monthly basis via direct debit.

 

In March 2011, RMV and DB agreed to create a single inter-operable ticketing system based on their existing NFC projects. The two firms will combine systems such that passengers can use NFC-enabled mobile phones to buy tickets for both local (Frankfurt-based services with RMV) and long-distance (DB) train travel. The existing ConTag and Touch&Travel touch points in Frankfurt will be replaced with new touch-screen ticket machines that allow users of NFC-enabled mobile phones to purchase tickets for RMV and DB.

 

Singapore (Singapore): Singapore has one of the most advanced fare systems in the world. The city-state has built a secure mobile wireless payment network based on NFC that can process credit card payments and the Singapore Standard for Contactless ePurse Application (CEPAS) e-payment services, using ez-link cards. The ez-link cards are multi-purpose, stored-value cards used for micro-payments including transit (bus, MRT, LRT), taxi fares, parking fee, and retail purchases.

 

In November 2010, the Infocomm Development Authority of Singapore issued a call-for-collaboration (CFC) to companies interested in developing the next-generation trust third party (TTP) infrastructure to be used by all banks, transport operators, and other service providers to deliver NFC services. In October 2011, the CFC was awarded to a consortium comprising seven companies – Gemalto Pte Limited, Citibank Singapore Limited, DBS, EZ-Link, M1 Limited, SingTel Mobile Singapore Pte Limited (SingTel), and StarHub. Gemalto is developing and operating the TTP infrastructure. DBS, EZ-Link, and Citibank will provide a wide range of stored-value payment products to be stored in mobile phone chips phones using NFC SIM from SingTel.

 

In August 2012, EZ-Link and SingTel launched the mobile payment service for NFC-enabled smart phones. There is no monthly subscription or one-time activation charge for the NFC service, which is accepted at over 20,000 points, including taxis, supermarkets, and fast food chains.

 

The EZ-Link mobile app can be downloaded from the Google Play store for use on NFC-enabled Android mobile handsets. The app allows customers to check transaction history and balances, top-up the e-purse through a debit or credit card, and sign up for the complimentary EZ-Link programme, Activate!, to block the e-purse and make refunds if the phone is lost. It also allows SingTel customers to top up on the go, just by using their NFC-enabled phone.

 

Hong Kong (China): The Hong Kong eTransport mobile application provides one-stop service for trip planning. The services covered in this application include railways, light-rail, bus, green minibus, ferry, tram and peak tram, cross-boundary coach to Huanggang, as well as a bus to Ma Wan and Discovery Bay. All information is provided free of charge by the Government of Hong Kong Transport Department.

 

The city has one of the most extensive smart card payment systems in the world featuring a smart card called Octopus, managed by Octopus Holdings Limited (OCL). In October 2013, OCL commenced the pilot launch of the mobile payment service enabled by Octopus Mobile SIM, an NFC-enabled SIM card manufactured by supplied by Netherlands-based Gemalto and powered by Japan-based Sony’s FeliCa™ mobile technology.

 

The first compatible handsets are Sony Xperia™ models, including Xperia V, Z, ZR, Z Ultra (3G), Z Ultra (LTE), and Z1. Subscribers of the local mobile network operator PCCW-HKT’s prepaid plan can access the mobile payment services by installing the FeliCa-based applet and using their smartphone as a contactless Octopus card.

 

Boston (US):  The Massachusetts Bay Transportation Authority (MBTA) and UK-based Masabi launched the country’s first fully smartphone-based ticketing system, JustRide, for commuter rail and boats, in November 2012. The system is a comprehensive mTicketing platform, including customer-facing apps for iOS and Android users, conductor validation apps for staff, a management console, secure payment integration, and a cloud-based back-end system for customer service and support.

 

Between November 2012 and August 2013, MBTA’s mobile ticketing platform reached USD10 million in sales and over one million tickets were sold using the ‘mTicket’ smartphone app, representing 15 per cent of all non-corporate commuter rail ticket sales.

 

Dallas (US): The GoPass mobile ticketing application, launched in September 2013, allows passengers to purchase Dallas Area Rapid Transit Authority (DART) tickets and passes. The smartphone displays an image of the colour-coded ticket. GoPass also includes features to plan trips and learn about events held near transit centres. In future, the app will allow users to buy concert tickets and pay for travel to entertainment venues.

 

San Diego (US): San Diego Metropolitan Transit System (MTS) and Masabi launched the pilot of MTS mTicket, a mobile ticketing app, in September 2013. The app allows commuters to use their smartphone to purchase their day pass using credit or debit cards for travel on the San Diego Trolley to football stadiums during the games. The app can be downloaded free-of-charge from Google Play for Android devices and from the App Store for iPhone. Passengers can purchase tickets with their smartphone using all major credit or debit cards.

 

San Francisco (US): Cubic Transportation Systems (Cubic) and the Metropolitan Transportation Commission (MTC) launched a new mobile website for Clipper, the regional fare collection system. The website allows users to check card balance, add fare products, register cards, and order new cards. The main website automatically detects the platform and redirects the mobile phone user to the mobile website.

 

Osijek (Croatia): In September 2013, Vipnet, the first private mobile network operator in Croatia, a part of the Telekom Austria Group and a strategic partner of Vodafone, launched the mPrijevoz payment option to allow passengers to use near-field communication (NFC)-enabled mobile phones as a monthly pass on buses and trams in Osijek. The service is the first service of its kind in Croatia. To start using the service, customers need to replace their existing SIM with the NFC–SIM available at the company’s outlet.

 

The service is available for customers with Samsung Galaxy S3, Galaxy S3 Mini, Galaxy Young, Galaxy S4, Galaxy S4 Mini, or with LG Optimus L5 NFC phone, and requires a Vipnet post-paid subscription. Tickets can be purchased and renewed via the mPrijevoz Android app, and the payment is charged to the customer’s Vipnet monthly phone bill.

 

Zagreb (Croatia): Vipnet has launched the service to allow mobile phone users to purchase public transport tickets through SMS. To purchase tickets, passengers send an SMS containing the keyword ‘ZG’ to the number 8585. Tickets are received on the phone within two minutes as an SMS, which contains all the relevant information about the ticket, the seven-digit code, and information about the price, zone, and validity of the ticket. The message is to be retained until its expiry and displayed during ticket inspection.

 

Opportunities

 

As smartphones continue to gain prominence in the transit industry, significant opportunities exist for equipment providers and technology suppliers.

 

Table 3 indicates some cities where smartphone-based fare systems are planned.

 

Table 3: Key cities with smartphone-based fare system procurement plans

Region

No. of cities

Cities

Asia-Pacific

3

Singapore, Tokyo, Hong Kong

Europe

10

Arad, Barcelona, Copenhagen, Ljubljana, Novosibirsk, Sheffield, Skopje, Strasbourg,

Toulouse, Valencia

North

America

7

Austin, Boston, Montréal, New Jersey, New York, Philadelphia, Salt Lake City

Latin America

1

Rio de Janeiro

Middle East and Africa

3

Abu Dhabi, Kuwait City, Nairobi

Source: Global Mass Transit Research

 

Recent developments

 

Some of the key developments in the mobile ticketing industry during the first four months of 2014 are as follows:

 

 

 

 

 

 

 

 

 

 

Conclusion

 

The availability of NFC-enabled mobile phone handsets and development of infrastructure based on contactless technology have encouraged operators to deploy mobile ticketing. By 2017, one in three mobile phones is expected to be equipped with NFC. The estimated penetration rate of NFC-ready point-of-sale terminals by 2017 is about 90 per cent in Europe, 80 per cent in North America and Latin America, and 40 per cent in the rest of the world. This is expected to drive the growth of NFC-enabled mobile ticketing even further.