On 18th June 2012, Snapper received a notice from Auckland Transport, alleging various breaches of the participation agreement and a claim for damages. The basis of these claims has not been clarified and the notice incorporates a number of significant errors and inaccuracies. Infratil and Snapper strongly refute the allegations made and we will make our response to the detailed claims known as appropriate.

The release contains a useful outline of the players involved, and also calls into question the readiness of another supplier, Parkeon.

Snapper Car on Khyber Pass

The latest Infratil monthly report states that

Preparation is well advanced on bus fleets of North Star, Waka Pacific, Go West and Metrolink and Snapper is engaged with Auckland Transport to ensure coordination between both party’s customer service teams. Snapper will be available in April 2011, with installation completed by July 2011.

In Auckland over 80 shops now signed to accept Snapper for payment and to provide reload services. The objective of having Snapper available for use on major national branded outlets is also progressing.

So it looks like the cars are being used to roll out to the retailers. Still no word on when Auckland Transport’s Hop branding exercise will commence.

For those not quite up to speed on how integrated ticketing is progressing in Auckland, here is the timeline so far:

2 December 2009: On the eve of the confirmation of an integrated ticketing system for Auckland public transport, unsuccessful tenderer Snapper announces the rollout of Snapper on NZ Bus services, to be completed by the end of 2010. A spokeswoman for ARTA said there would be no public funding for Snapper. Authority chief executive Fergus Gammie called Snapper’s announcement “premature”.

7 December 2009: Auckland Regional Transport Authority sign an $47m contract with Thales to provide integrated electronic ticketing for buses, trains and ferries.

14 December 2009: Brian Rudman cites a confidential paper from Infratil director Paul Ridley-Smith, which states “if Snapper can’t expand into Auckland then its business will be permanently sub-economic and it may have to withdraw from Wellington, where it was introduced 12 months ago.”

16 December 2010: Auckland Transport announce that “Supplementing the contract already in place with Thales, a Participation Agreement has now been signed between Auckland Transport, NZ Bus and Snapper for the introduction of a single smartcard for use on NZ Bus services as part of the Auckland Integrated Ticketing program.

“Interoperable equipment will be deployed onto services run by NZ Bus early next year. Customers of North Star, Waka Pacific, Go West, Metrolink and LINK will use a contactless smartcard which will launch Auckland Transport’s Integrated Ticketing brand.”

“We will be following the deployment of equipment on NZ Bus services with the expansion of Integrated Ticketing on rail and ferry services. We expect the timing for this to be in the lead-up to the Rugby World Cup.

“This will be linked to the launch of a travel product specifically for visitors to Auckland which will make public transport an attractive option during the period of the Rugby World Cup. We will be announcing further details of this and other initiatives over the coming months.

“Supporting this participation agreement for bus equipment and ticket deployment, Auckland Transport’s ticketing system partner, Thales is progressing the development of the rail and ferry solutions and the central system.

Bruce Emson, NZ Bus CEO, announces the roll out of the card will commence in March 2011. Programme Director Greg Ellis maintains that the key objective is still to have one card across all modes, and that the new card won’t be called Snapper.

17 December 2010: Ritchies and Howick and Eastern Buses say they are still investigating options, and are unlikely to sign up in time for the Rugby World Cup.

24 December 2010: The Herald runs a story that there is a budget of $1m to publicise the “Hop Card”, which is a “a new electronic ticket for seamless travel on buses, trains and ferries. It refuses to confirm the name until launching an awareness campaign late next month for the $98 million card, although chief operating officer Fergus Gammie has assured Auckland Council’s transport committee that the region’s public transport brand would be prominent on it.”

25 Jan 2011: Work on installation of Thales installed ticket validator machines commences at Mt Albert, Morningside and Mt Eden stations.

Bus operators Ritchies Transport and Howick and Eastern said they were still investigating various options for joining the scheme, and were unlikely to sign up in time for the rugby cup.

Ritchies director Andrew Ritchie said the ticketing machines on his 200 or so Auckland buses were relatively new, and he saw no urgency to join the scheme until restructured fares become available as a sequel to the ticketing project.

Ritchies operates the hugely successful Northern Busway, so getting Ritchies on board is pivotal to the success of an integrated ticket.

Again, it is disappointing that a huge amount of effort is going into technical solutions to support ticketing products that should be redundant.

Take 10 trip (multi-journey) tickets for example.  Users have to buy blocks of 10 tickets for preset stages.  You can currently use your GoRider card for this.  But if your bus trip goes 3 stages and your multi-journey ticket is good for two stages, then you have to pay for the extra stage with cash.  Similarly you lose money if you only travel 2 stages on a 3 stage ticket. The only reason that people buy these inconvenient tickets are because the tickets are heavily discounted, especially for tertiary students.  Implementing a 10 trip ticket on a GPS “tag on / tag off” system like the new integrated ticket is problematic.  You have to have logic to know how much extra to charge the customer if they override the preset number of stages, and deduct this amount from the card on exit.

This is complexity we don’t need. These same discounts could easily be applied to” stored value” fares.

The sooner we get on to a simplified fare structure that includes the Northern Busway in Auckland, the better.

Auckland Transport today announced a key development in the region’s Integrated Ticketing system will be introduced early next year which will allow people to use a single “smart-card” on public transport in Auckland.

Auckland Transport’s Chief Executive, David Warburton said, “Supplementing the contract already in place with Thales, a Participation Agreement has now been signed between Auckland Transport, NZ Bus and Snapper for the introduction of a single smartcard for use on NZ Bus services as part of the Auckland Integrated Ticketing program.

“Interoperable equipment will be deployed onto services run by NZ Bus early next year. Customers of North Star, Waka Pacific, Go West, Metrolink and LINK will use a contactless smartcard which will launch Auckland Transport’s Integrated Ticketing brand.”

Dr Warburton said, “We will be following the deployment of equipment on NZ Bus services with the expansion of Integrated Ticketing on rail and ferry services. We expect the timing for this to be in the lead-up to the Rugby World Cup.

“This will be linked to the launch of a travel product specifically for visitors to Auckland which will make public transport an attractive option during the period of the Rugby World Cup. We will be announcing further details of this and other initiatives over the coming months.

“Supporting this participation agreement for bus equipment and ticket deployment, Auckland Transport’s ticketing system partner, Thales is progressing the development of the rail and ferry solutions and the central system”.

Peter Beggs, Country Director, Thales New Zealand said, “As the core ticketing system provider (central system, rail and ferry), Thales welcomes the participation of other suppliers in providing the bus solution for the system…”

• David Warburton (Auckland Transport CEO)
• Bruce Emson (NZ Bus CEO)
• Mick Spiers (Thales Programme Manager)
• Miki Szikzai (Snapper CEO)
• Greg Ellis (Auckland Transport AIFS Programme Manager)

Other bus operators were not there.

The guts of it is that Snapper and the Auckland NZ Bus rollout has officially been brought into the AIFS project. Mick Spiers said that the Snapper card will integrate with the Thales designed back end system.

The Snapper card is apparently going to be branded as the integrated ticket – they didn’t mention “Hop” card branding.

Mick Spiers said that Thales is focussing on implementing validator hardware for selected train stations and the Auckland and Devonport ferry terminals. He didn’t specifically say that they rail and ferry validators would support the Snapper card though.

I asked if there was going to be any rationalisation of the different ticketing products such as multi-journey. The answer from David Warburton was today’s announcement is stage 1, and that rationalisation will occur at a later stage. This is the wrong approach in my opinion. Products such as multi-journey tickets with preset numbers of stages just do not work with a tag on / tag off system. The only reason MJ exists is because tertiary students get a 40% discount when they use it.

Other bus operators were not present. They are “at different stages of understanding”. I’m curious to know what they think and if they are going to use the Snapper card or the Thales card (if this is still going ahead). I asked if this meant that there is still the potential for two different cards to have to be carried. Greg Ellis said that the key objective is to have one card across all modes. I’m still struggling to see how the card can be anything but the Snapper card at this point, given the Snapper and Thales cards are different technologies, but for now I guess we take this at face value.

Bottom line is that there doesn’t seem to be much new here, and there are still more questions than answers.  I’m really hanging out for the new fare structures as I was hoping that after a year this would have been thought about.  Kudos to NZ Bus if they can pull off the Snapper implementation in the first quarter of next year, especially if they have to support the existing ticket types.

Mathew Dearnaley asked for a list of milestones for the project because, as he said, the project has been going for a year now and it has been hard to know what has been going on.

Personally I’m drawn to the idea of fare caps, which is how I understand it works in London. In this scenario, punters are charged when they get on their first trip, but as they get on subsequent trips during the day they aren’t charged over a certain fare cap amount ($5 for example).

Anyhow, the post got a really great response from loose_shunter, “a fares policy person” over at the Victorian Department of Transport. It’s well thought out and informative, so I’ve posted it here as an article.  ARTA, employ that person!

The first principles decision to make is whether you have a distance or zone-based fare structure? Next, do you choose a time-based or journey-based ticketing product?

In what I’m about to say, I have assumed a zone-based fares structure and a time-based ticketing product (like Melbourne or Perth) because that’s a system I can talk about with some knowledge.

In my mind, the key elements to a possible fares structure for Auckland are as follows:

No financial penalty for multi-modal travel – Customers must not be penalised for transfers between mode. The good Dr Mees is quoted on somebody’s sig about this and it should be a self-evident principle.

Steep price differential between ‘cash’ and ‘stored value’ fares – You’ll never be able to totally get rid of a cash ticket as there will always be tourists (who don’t want to invest in a smartcard or don’t know the system), the ignorant, tinfoil hat wearers (smartcards are a de facto tracking system for the New World Order) or others that don’t want to switch to stored value.

However, to set a premium for the ease and convenience (to both operator and customer) of stored value, cash tickets should show a strong (>20%) price differential above stored value fares. SE Queensland have decided to further raise the difference between cash and stored value while offering incentives to switch to stored value.

2 hour/Daily fare capping – the 2 hour (or 3 hour or whatever time period is chosen) cap should allow a customer to make at the very least a single journey across town for a long distance and a return journey over a short distance. The second time a 2 hour fare is validated, the cap should then roll over to a Daily cap. This is what Melbourne’s fare system does already with the 10×2 hour ticket (the 2nd validation ‘converts’ it to a Daily) and will transfer across to myki. The Daily fare cap should be the equivalent of a return journey for the combination of zone or zones travelled.

Simplify the existing fares structure – This is really important to try and modify customer behaviour before implementing a new ticketing system. Look through the ticketing data, find the tickets which have low sales and get rid of them. Simplify the number of products and develop a standard product range to help reduce confusion and promote a ‘multi-operator/multi-modal’ mindset among customers. This means all the products used by individual operators must go to be standardised on a basic range used across all modes. Melbourne fought this battle in 2003-4 when the plethora of non-standard products used by Connex, M>Train, M>Tram and Yarra and National Bus were gradually washed out of the system over the following 3 years. Once you’ve got a standardised fares structure, lots of other things will flow from it – off-peak weekday pricing, weekend discounts, free travel offers and all the rest can happen once there’s a unified fares system.

The other fundamental questions come down to whether you want to abolish periodical tickets or keep them. You need good ticketing sales data to know how big a segment periodical ticket holders to keep them as part of your new fares structure or the political will to abolish periodicals (as they did in Perth many years ago). If you want to keep periodicals, they need to be created as a separate, stored value ‘pass’ product kept different to stored value. Perth translated the discounts for periodicals to the multi-trip tickets in their old ticketing system and then translated it again to the reload mode on Smartrider (the deepest discount went to ‘autoload’ customers, while stored value customers got the basic discount).