London's Oyster Card

Revolution to Evolution

PREPAID conference 2010

Peter Lewis

Oyster Development Manager

Transport for London

Ticketing timeline

1983: Travelcard launched in London

1989: Travelcard integrated with national rail

1998: Prestige contract for ticketing services

2003: Oyster launched

2004: Oyster PAYG launched

2007-10: PAYG extended to national rail

2011-15: Bank card (EMV) acceptance planned

across TfL

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TfL moves over 3 million people every

day

• 12 million active cards in use

• Every weekday in London:

– 6.3 million journeys on London‟s buses

– 3.5 million on the Tube and Rail

– 0.2 million on trams, light rail and river

boats

– 80% of these are using Oyster

• 70% of National Rail journeys begin or end

in London

• 8,500 buses

• 650 tube and rail stations accept Oyster

• 4,000 retail outlets (newsagents)

• 25,000+ Oyster card readers

• £2.5 billion (5.3 billion SGD) fares income in

2009

Extended use of Oyster

• Oyster on

National Rail

Services

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• Oyster on Thames

River Boat

Services

Over 13 million

contactless

taps a day

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Fare collection objectives – 2010

onwards

TfL aims to:

1. Retain operational benefits of

contactless fare collection –

passenger throughput & fraud

reduction

2. Maintain & improve customer

convenience of contactless

travel & ease of payment

3. Reduce fraud and ticket-less

travel further, and reduce costs –

one of the Mayor‟s priorities

Oyster: Current State

• TfL very happy with what it has achieved with

Oyster

– Customer satisfaction is very high

– Business objectives achieved

– Faults/deficiencies are small and manageable

• No desire to give up Oyster without improving on

key deliverables

• Biggest concern going forward is cost of revenue

collection

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Current challenges

• Despite the visible success of Oyster, ticketing still represents a

difficult business model

• Need to think from first principles about models for revenue

collection

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Multiple sales channels

• TfL channels

– Ticket offices

– Self-serve machines

– Web

• Third party channels

– National Rail “joint stations”

– Oyster Ticket Stops

– Visit London

– Visit Britain

– Eurostar

– Coach operators

– WH Smiths

Commissions

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How can we lower our revenue collection

costs?

We have reviewed our options for 2010-2020

• Considered all „flavours‟ of contactless:

– transit-specific

– payments

– NFC

• Considered wider technology trends

• Current hypothesis:

– Embrace payments industry standards not transit ones

– Exploit fast network technologies to get complexity off the cards

– Cope with fares policy complexity in TfL-specific back-office

• Payment standards = +

The future of money

Contactless bankcard and mobile payment platforms finally seem to

be appearing on the market

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Work to date – this is not a standing

start!

• Initial learnings from Barclaycard

OnePulse in 2007

• Embarked on formal discussions

with MasterCard and Visa in late

2007

– EMV education

– Concept

– Proof of concept demonstrations

• Member of Payment Council large

corporate user forum

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TfL’s Future Ticketing Vision

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• Maximise revenue net of cost of sale

• Increase customer self-service

– Reduce queues for tickets

– Reduce ticket selling costs

– Take of advantage of internet technology

– Improve customer journey experiences

– Eliminate the need to top up or purchase a ticket and then travel

• Centralise fare calculation system

– Reduce dependency on read/write cycle & complex calculations

at 25,000+ card readers

– Easier implementation of fare and product changes

Delivering the vision

• Bank and payment card acceptance as an alternative to

current ticketing technology

– Acceptance by product type

– Introduction of new products – weekly capping?

• Migration of Oyster into EMV technology

• Eventual elimination of the „currency exchange‟

This is evolution, not another

revolution

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A vision of the future

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Thank

you

peterlewis@tfl.gov.uk