1. The Future of Public
Transport Ticketing
Mike Burden
Principal Consultant
Consult Hyperion

2. Agenda
2
• Technology
• Account Based Systems
• Sales and Distribution
• Transaction Model
• Costs
• Reader Design
• TfL Implementation
• Summary

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. There is a trend away from card based schemes
towards account based
4
SmartNon-Smart
AccountCard

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. 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. 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
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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. The Multi-Application Reader
• „Ideal‟ / modular architecture
• Designed for efficient re-certification
9

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. 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. 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”
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13. Is “Payment Option” the 5th P of Marketing?
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14. Tomorrow’s Transactions:
thought leadership from Consult Hyperion
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Contact Details
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Mike Burden
Principal Consultant
Consult Hyperion
(M) +44 7976 951 161
(T) +44 1483 301 793
(e) mike.burden@chyp.com