Ticketing and Concessionary Travel on Public Transport - United ...

3 Smartcard technologies
New technologies, new opportunities
30. The era of the paper ticket may be drawing to a close. Technologies now exist that
enable more sophisticated <strong>and</strong> integrated ticketing arrangements. “Virtual” tickets can now
be included in smartcards or in mobile phones or other electronic items, which are read
automatically (or semi-automatically) at some point on the journey. 32 The most
intensively-used system is the London Oyster. Launched in 2002, there are now 15 million
Oyster cards in circulation, used for some 7 million journeys each day. The Oyster card
allows users to mix a fixed period <strong>Travel</strong>card with Pay-as-you-Go credits that can
automatically charge for extensions beyond the <strong>Travel</strong>card’s validity. They are also
significantly quicker to read than magnetic paper tickets <strong>and</strong> this has increased passenger
throughput at busy Underground stations, <strong>and</strong>, along with other changes, has helped to
reduce bus boarding times.
31. TfL told us that
Overall, TfL considers that the introduction of the Oyster smartcard has been
unambiguously positive. It has improved the customer experience in many ways.
Certainly customers can proceed through TfL stations <strong>and</strong> board TfL buses much
more quickly than used to be the case, <strong>and</strong> they are unanimously positive about this.
[…] Customers now have a wider choice of travel products including the Oyster Payas-you-Go
stored value product which was impossible to deliver using paper
tickets. 33
32. TfL pointed out, however, that such a scheme does not come cheap: TfL pays its PFI
contractor substantial service charges to provide <strong>and</strong> operate the Oyster system. These
costs are deemed justified because of the benefits that the system provides.
33. Outside London, the take-up by the transport industry of smartcard technologies has
been limited. It is mainly restricted to the metropolitan areas <strong>and</strong> some other cities, mostly
those which have been part-funded by the local transport authorities. Smartcard systems
can be complex <strong>and</strong> expensive <strong>and</strong> may not be appropriate in all situations, particularly for
infrequent travellers or less intensively used transport systems.
34. Smartcards present new challenges to transport operators <strong>and</strong> public authorities. They
offer the potential for a new level of passenger convenience, flexibility <strong>and</strong> choice in
ticketing. The technology <strong>and</strong> economics are advancing fast <strong>and</strong> smartcards are likely to be
commercially viable for a wider range of transport uses in future. In the right
circumstances, they can also provide the transport operators with major benefits, including
reduced costs of ticket sales, better monitoring, <strong>and</strong> more accurate allocation of costs <strong>and</strong>
revenues. However, they are not appropriate for all people on all journeys. For example,
32 A related development is the contactless bank card, which can be used for low-value purchases in place of cash.
Although Barclaycard already issue a card which combines Oyster, a credit card <strong>and</strong> a contactless payment, a
contactless bank card could be used on its own for public transport, if the appropriate systems were installed.
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