Ticket to ride
Ticket to ride
September 1, 2005: An international consortium of transport and technology specialists has been selected to work in partnership with the Victorian Government to develop the state's next generation of public transport ticketing. Stuart Finlayson found out how the massive $494 million technology contract will be fulfilled.
In July of this year, Victorian Premier Steve Bracks announced with some fanfare that Kamco (The Keane Australia Micropayment Consortium) - a team of transport and technology experts - had been awarded a $494 million contract to implement the smartcard ticketing system for the state's public transport network, following a rigorous nine month tendering process. The deal includes two years of development work and ten years of operation and maintenance.
“The days of continually needing to buy new tickets are numbered. In 2007, Victorians will enter an era of smartcard travel that will help deliver a simpler and more convenient public transport system,” declared Bracks.
Bracks added that the selection of Kamco would bring significant economic benefits to Melbourne and Victoria as a whole, creating up to 100 jobs.
This micropayment smartcard technology ticketing system will support Victoria’s multi-modal network of 270 railway stations, 480 trams and 1,650 buses that services more than 410 million journeys each year. The new system is scheduled to go live in 2007, enabling travelers to access all types of public transit using a single micropayment smartcard. The smartcard is a durable plastic card similar to a pre-paid mobile phone card, and a significant improvement from today’s paper magnetic-stripe tickets. Passengers will be able to store value on their cards using self-service machines, the telephone or the Internet. With a simple scan of their card at the turnstile or when boarding a bus or tram, the cost of the ride is automatically deducted.
Keane has established Kamco to deliver the new ticketing solution to Victoria’s Transport Ticketing Authority (TTA). Kamco, a wholly owned subsidiary of Keane, Inc., will design, build, implement and support the comprehensive smartcard technology system and related equipment. Kamco’s partners include Keane entities and automatic fare collection specialists Ascom, ERG, and Giesecke & Devrient Australasia (G&D). Ascom’s portion of this deal is valued at approximately $124 million and ERG’s portion of this deal is approximately $106 million.
Keane will build the technology backbone of the smartcard system; Ascom will provide all fare collection equipment and the terminal management system; ERG will manage the installation and maintenance of the fare collection equipment and G&D will provide the actual smartcards.
Due Diligence
Such a large undertaking involving such a large amount of taxpayer's money must as a matter of course undergo a rigorous due diligence process, which Joanne Stepp, marketing and communications manager for the transport Ticketing Authority, says was strictly adhered to.
"The Transport Ticketing Authority put in place an evaluation process which has been both thorough and complete to meet the New Ticketing Solution delivery target as set by the government. The assessment process has been monitored by an independent probity auditor. The preferred bidder has demonstrated their capability to deliver a Victoria specific solution as set out by the assessment criteria."
Keane's president and CEO, Brian Keane confirmed that the TTA's demands were exacting, and that the winning consortium beat off some stiff competition to secure the deal.
"The TTA procurement process was rigorous, attracting vendors with ticketing systems experience from around the world. Keane demonstrated deep transit and financial services industry and fare collection experience, strong technology and open systems expertise, and proven leadership in program management to secure the contract through Kamco."
Communication Breakdown
With four entities working on the project, I put it to the TTA's Stepp that this could lead to communication problems and delays, but Stepp says this eventuality was also factored into the selection process.
"As part of the TTA's evaluation process all elements of the bid were examined, including how they work together. Kamco has been selected as the preferred bidder based on the total new ticketing solution it has presented – design, technology, flexibility, operation and maintenance."
Victoria Victorious
Keane CEO, Brian Keane says the consortium is fully aware of the responsibility that has been bestowed upon it and has established its project management structure accordingly.
"With management control centralised in Kamco’s Melbourne-based Program Management Office, the company will oversee the entire engagement and its numerous subcontractors, providing a single point of accountability for the TTA, and will operate the mission-critical back-office financial and data processing system. In addition, Keane will provide application development and integration, business process services and application services through its operations in the United States, Australia, Canada, India and the United Kingdom. By balancing work assignments across a global network of skilled resources, Keane’s global delivery model is designed to allow the TTA to tailor work distribution to match cost, resource, project and risk requirements while meeting Keane’s high-quality delivery standards regardless of where the work is performed."
Keane is confident that the project will be such a success that other cities around the globe will look to Melbourne as a shining example of how to implement such a system, and may even have benefits for other vertical markets in Victoria and beyond.
"Keane is committed to being an outstanding business partner with the Transport Ticketing Authority and Victoria Government by creating a collaborative project environment. Central to the new TTA system is a customer focus to provide reliable, convenient and rapid ticketing processes. We believe that this innovative and repeatable solution will prove relevant to other major international cities looking to address their transit ticketing systems. We also see the applicability of this smartcard and micropayment technology approach to other industries such as financial services and healthcare systems."
Indeed, Kamco’s project team members have successfully implemented other smartcard transit solutions in Hong Kong, Taipei, Singapore and Holland.
Keane has stated that the design is an innovative departure from the traditional model for transit ticketing systems. The new ticketing system will combine proven, off-the-shelf software (approximately 70 percent) with custom development (approximately 30 percent) in an industry-standard open architecture. The new system will use Microsoft's Axapta Enterprise Resource Planning (ERP) application, and web services technologies such as .NET. Keane says it has demonstrated that using proven applications and technologies provides a highly reliable, easy-to-maintain system where changes can be made without difficulty. In addition, the use of standard applications eliminates dependency on the software supplier - allowing the Transport Ticketing Authority to choose from an extensive pool of qualified resources to support the system. The system is built with a services-oriented architecture and open standards and it will have the flexibility to expand the solution in the future.
A Fare Go
So what about the nuts and bolts of the system? How, for example, does the system calculate the fare a regular user has to pay compared to an infrequent user so that the savings such users would normally receive from a weekly or a monthly pass will still be available to them?
The TTA's Stepp explains: "Customers travelling around on the system will have two options. They will be able to simply load cash onto their card and let the system calculate the best vale fare for them, or they can pre-purchase ticket products such as weekly, monthly or yearly products onto their smartcard. When customers scan and off, the system will either deduct the best value fare if they have loaded cash onto their card, or it will recognise that there is a pre-purchased monthly ticket on there, thereby always guaranteeing the best value fare."
Premier Bracks adds: "Passengers will be able to use their own long life smartcard to travel on metropolitan trains, trams, buses, as well as V/Line trains and coaches and major regional bus services.
"The smartcard is a durable plastic card which can be pre-loaded with monetary value – it only needs to be scanned for less than half a second, and can be used from inside a wallet or handbag.
"Regular users will have the option of loading value onto their smartcards using credit cards, debit cards or cash at train stations, dedicated machines, online or over the telephone. Alternatively, users can purchase disposable smartcards using cash at a station, or on board a tram or bus – an attractive choice for casual users and tourists."
Other activities, such as newspaper purchase and dry cleaning, could be incorporated into the smartcard system in the future, but the initial focus would be on bringing benefits to public transport ticketing.
Transport Minister, Peter Batchelor says further contracts would be let for additional civil works associated with the project.
"Consistent with the existing contract, we envisage further contracts to deal with various aspects of the operation, administration and marketing of the new ticketing system."
Batchelor says that following the business requirements phase, mobile and fixed demonstration suites will be available from next year to enable people to experience first hand the smartcard technology being tailored for Victoria.
“A trial of smartcard technology will take place in regional Victoria once testing is completed, and those in the trial will be the first to pay all their fares with the same long life smartcard."
Stepp says the new system will hold numerous advantages for consumers.
"The Smartcard ticketing solution will give passengers a one-step, fast and easy way of selecting the right fare and paying it. The transaction is smooth as the card only needs to be held near a reader screen for less than a second to simultaneously pay and validate. It's also safe because the card can stay inside wallets or handbags, and it removes the need to pay with cash. Smartcards will be about the size of credit cards so they fit neatly in a wallet or purse. They can be made of durable plastic for long-life use, or made of a laminated card for short-life use and then disposal. Both types will have a small microchip implanted in them."
Stepp also stresses that the implementation will not lead to fare hikes to help cover the estimated $494 million cost involved in developing and maintaining the system.
"The smartcard ticketing solution has been required by Government to operate with the current fare structure, therefore customers will be able to purchase all the existing ticket products that exist today, including the monthly ticket. The cost of the new tickets will not alter, other than the usual fare increases that occur annually."
Batchelor is confident that the choice of partner for the undertaking has gone a long way to ensuring that it will be a complete success.
“There’s a massive amount of work to be done over the next two years, but with the selection of Kamco as our project partner, we are on track to deliver a world class ticketing solution to Victoria."
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