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Snapper/HOP fiasco continues

Some interesting developments today in the ongoing fiasco, with Auckland Transport now apparently denying they’ve kicked Snapper out of negotiations to provide the bus solution on NZ Bus services. Here’s the latest report:

Auckland Transport is denying speculation that Snapper been dumped from a project to unite the city’s public transport infrastructure under a single electronic billing system.

Several media reports this morning claimed the transport authority’s board met yesterday to drop the firm and rescue the $98 million Hop project after the Snapper technology used by NZ Bus, the city’s biggest bus operator, proved incompatible with the overall billing system.

Snapper Services, the sister company of NZ Bus, was given the opportunity for its cards to become compatible with those of Thales, the French company which won the contract to provide an integrated ticketing system for Auckland transport.

This compares with earlier reports that Auckland Transport will pay for replacement ticketing machines on all NZ Bus buses, which was reported on Morning Report this morning, and was in the print version of the NZ Herald (but isn’t online for some reason) today. A few more comments from Auckland Transport don’t shed much light either:

Sharon Hunter, a spokesperson for Auckland Transport, said it was still working with Snapper on the project.

But she did admit there was “still some discussion” around whether the project will meet its scheduled November 30 launch date.

Why on earth is it so difficult for AT to just tell us what’s happening?

126 comments to Snapper/HOP fiasco continues

  • Sharon Hunter

    Hello. The last comment is incorrect and should be removed from Stuff and the TVNZ site who followed it by now- you can always come to the source!

    No comment is being made due to the fact that Auckland Transport is currently in discussions with Snapper and we do not want to prejudice those discussions.

    • Bryce

      Maybe the source should be letting the Auckland ratepayers know what the hell is actually going on.

    • Forgive me for being a bit terse Sharon but seeing you here and as the first commenter is speaking volumes of something might be ponging over your way and the Main Stream Media are having once heck of a run with this. Heck the conversation over smoko and the water-cooler all day was Snapper.

      I agree with Bryce in his comment: “Maybe the source should be letting the Auckland ratepayers know what the hell is actually going on.” instead of being given the spiky fish bums rush (quoting a fine Brian Rudman analogy) and we wonder why critical opinion comes back against AT via blogs and the MSM (when they pick up on it…)

      So as Mr Anderson says: are the MSM right or not?

  • Mr Anderson

    Thanks for dropping by Sharon. Are you saying that all the reports (NZ Herald today, Radio NZ yesterday and today, Brian Rudman yesterday) are all incorrect in terms of Snapper’s ongoing role in the integrated ticketing system?

  • Sacha

    “Why on earth is it so difficult for AT to just tell us what’s happening?”

    Lawyers, in a word.

  • Jon Reeves

    Watching from my armchair here in Switzerland all I can say is – what a mess this has turned out to be! I cannot think of another transport authority anywhere getting into such a pickle over a transport card. Just do Auckland ratepayers a big favour, DUMP Snapper and get on with what AT is supposed to be doing.

    PS…and blame Steven Joyce and the cronies in National for bringing Snapper into the equation in the first place!!!

    • obi

      “I cannot think of another transport authority anywhere getting into such a pickle over a transport card.”

      You’ve never heard of Myki? Rollout not complete yet and already five years behind schedule. Cost ballooned from $AU500million to $AU1.5billion and counting. Probity issues. Customer complaints. Reliability issues. Privacy concerns. Etc.

    • Stu Donovan

      And Sydney – 10 years and hundreds of millions of dollars later they have not achieved it methinks.

  • Cam

    Well it appears that maybe we could be finally rid of Snapper (I’m sure not without substantial cost) that would be a good result). With them out of the way we can finally get on with this project and hopefully in the next 6 – 12 months have an integrated ticketing system. Now cue everyone’s favourtie Snapper shill/troll to tell us that all of this is in fact the fault of Auckland Transport and the other bus companies and not Snapper….

  • Bob

    Why isn’t the system up and working on ferries and trains? Isn’t NZBus only one part of the system?

    • Marija

      Exactly Bob,

      And where is the Auditor General’s report – when was it supposed to be released?

      Snapper is not stopping a trial of the existing system or the Auditor General’s report from coming out!

      • conan

        The Auditor General announced that they were investigating this around 6-7 weeks ago. These sorts of things take time and there generally isn’t a timetable. Certainly at the time no time for the output of the report was announced.

        There have been suggestions of undue influence and the like in this matter and no doubt the Auditor General will be through, which takes time. Any suggestion however that there is some form of silencing or burying going on is undeserved and unwarranted.

        • Cameron Pitches

          Actually the AG had the investigation down in the 2011/12 annual plan for investigation, so they have been working on it longer than that.

        • I asked the Office of the Auditor General about the report and received the following response three weeks ago:

          We have a study in progress on the introduction of integrated ticketing in Auckland. As part of a focus on providing good analysis and reporting of information about the transport sector, the Auditor-General noted in her 2011/12 Annual Plan (http://www.oag.govt.nz/2011/2011-12) that we intended to carry out a study of a transport-related topic. The relevant extract from the Annual Plan is: “We intend to carry out a special study of a transport-related topic that we will identify during 2011/12. This study will be short and focused, to provide assurance to Parliament that a specific project or issue is being managed appropriately. A potential topic is the introduction of integrated ticketing in Auckland”.

          As part of our work we have had discussions will all parties involved in the AIFS project, including NZ Bus. We are working through our internal processes to prepare our report. At this stage, we are not sure how long this will take given competing priorities and issues still being addressed in the AIFS project as a whole. As is the case with all of our work, we make no public comment about the content of our reports until they are completed.

        • Stu Donovan

          Oh wow. The AG is involved – I’m quite sad it’s such a pickle but the end result will hopefully be worth it. And as Jon notes, it makes for quite good arm-chair viewing.

        • I reported months ago, before the thing blew up last time that the AG was looking into things. The information came from an NZTA board report

          http://transportblog.co.nz/2012/05/29/nztas-updates-on-integrated-ticketing/

    • JCNZ

      Rail and ferry to go live in the next two or three months (apparently around 1 Nov). Trials for these two modes are underway, if not, are about to get underway.

  • Bob

    Aren’t there other bus companies beside NZBus? Why isn’t the system being rolled out on them? Or at least trialled to show us it’s working!

    • Hamish O

      Parkeon, the other bus companies supplier is delayed, I don’t think that recently any one has expected them to be ready for November. Snapper is a different story, they are hogging the HOP brand name from Ferries and Trains that are ready, and are not getting any closer to compatibility with the Thales system. Snapper is also under contract to be compatible by November, whereas the other bus companies really only need to be ready for the next round of contracting in 2014, where AT will make accepting the HOP card a requirement.

  • Bob

    Why shouldn’t the other bus companies be ready? It’s either all or nothing, surely? Isn’t hat what integrated ticketing means?

    Who is running this project? AT?

    • Bryce

      From what I know Bob, originally Thales were going to supply card readers for everything. Once NZ Bus managed to get approval (from AT via govt intervention it appears) for their own Snapper gear to be used (which we are hearing it may or may not even be used after all), it was no longer economic for Thales to supply the readers. This is where Parkeon came in hence the delay.

  • Bryce

    I read somewhere that ferry trials have been underway for a while now. Does anyone know what card reading gear they use? Thales? What are the trains using? Thales? Is it just the buses that are using the Parkeon / Snapper systems?

    • Hamish O

      Train/Ferry = Thales (ready)
      Buses excluding NZBus = Parkeon (delayed but getting there)
      NZBus = Snapper???

  • Bob

    I find it most odd the Ferries and Trains aren’t up and runni,and that some bus companies are being given years longer.

    Who is in charge of this project? Snapper? Are they the project manager, or AT?

    • Hamish O

      The ferries and trains aren’t up and running because the HOP brand name is still plastered over hundreds of snapper readers.
      AT could of course create a new brand, but if NZBus can be ready by November then it could be worth waiting.

      The reason that NZBus is expected/contracted to be ready ‘on time’ is that they were allowed to put in Snapper readers early, so need to be integrated from day one to prevent operating two different HOP cards.

      Obviously AT is running the project, which they adopted from ARTA when the super council formed. NZTA helped out with the contracting though. The reason the media is on to this right at the moment is that AT are having discussions with Snapper.

  • Bob

    Then it’s AT who need to answer some serious questions. If a project has gone off the rails, then surely the buck stops with the project manager, not with one supplier of many.

    • Hamish O

      Yes, we can only hope to learn from our mistakes. However, in the mean time the focus needs to be on getting Integrated Ticketing up and running. Then a fully comprehensive inquiry needs to take place.

      Often Snapper is made into the enemy as if it weren’t for their own motivations the situation would have been a lot simpler for AT/ARTA.

    • Bryce

      I would love to know just what was required to get ARTA to agree to snapper even after they went to court. How much government arm twisting was there to get them to say “ok NZ Bus but snapper has to work”?

      • The fact that Brian Rudman can print this without being sued should tell you something:

        The story then goes that Infratil’s founder, the late Lloyd Morrison, a friend and neighbour of Deputy Prime Minister Bill English, lobbied vigorously to get Snapper back into the picture.

        Arms were twisted and AT, which relies on Government funding for rail electrification and the like, was persuaded that bringing the dead Snapper back to the table wasn’t such a bad idea after all.

        • Stu Donovan

          Oh my goodness – a dash of overbearing government influence. This is so exciting I have goose bumps. Thing is, I like Bill so I’d rather if it was Joyce or Brownlee that gets dragged down by this sordid affair.

          • Same here, and heck if Rudman could run with that and not get a haulling over then yeah as you say Stu and Cameron, this is rather telling.

            Also rather telling is that even things are quiet my end – the cannons are rather err silent after I ran around waving some posts :P

          • Bryce

            What do Bill English, Stephen Joyce and Gerry Brownlee have in common (apart from the obvious)?

            None of them live in Auckland yet feel quite entitled to tell Auckland how to develop.

        • Doloras LaPicho

          Well, there’s no such thing as defaming the dead.

    • swan

      “If a project has gone off the rails, then surely the buck stops with the project manager, not with one supplier of many.”

      This would be a fair point if there wasnt political interference in the process in the first place. I think it is a bit much to suggest project managers need to account for the risk of political interference.

      • The buck stops with the Board of AT.

        • Sacha

          And then with both Auckland Council and the Minister of Transport who appointed them.

        • Bryce

          That’s a bit like saying the World Cup opening night debacle was just AT’s fault even though continued government interference and objections to AT / AC’s plans led to a single fan zone and schools operating as per norm. Both situations have the look of government sticking their fingers in and making situations much worse than they needed to be.

          • Cameron Pitches

            No it isn’t. The Snapper / Hop issue has dragged on for years and the Board have had decision making ability every step of the way. If there was central Govt interference with the competitive tender process then the Board should have nailed that, since it breaches rules around good corporate governance and undermines the competitive tender process that Thales had to go through.

          • Bryce

            The problem AT have is that the government are chipping in quite a bit of cash as well ($43m) to get this going so they are not really alone in the whole ownership of the system. The process has taken 6 years (from initial planning) so far and from what I can tell, that is in line with similar projects overseas.

      • Bob

        AT knew the arrangement and have had *plenty* of time to manage it. If adding one supplier is deemed “too complicated”, then you’ve really got to wonder is some people are in the right job….

        • swan

          “If adding one supplier is deemed “too complicated”…”

          Who has deemed it “too complicated”. The statement “adding one supplier” means nothing.

          The inclusion of snapper as a card reader supplier changed procurement from a single supplier THAT IS ALSO supplying the integrated ticketing system, to multiple suppliers that then requires an open standard to be written etc. It changes the ball game. Tell me that is obvious to you.

          • Bob

            Something doesn’t add up here.

            Thales is a supplier, with a lot of experience putting in these systems. Snapper is a supplier, with experience putting in these systems – and their system is currently operable in Auckland on NZBus. Parkeon, I’m assuming, likewise. Anyone else?

            So, what is AT doing, exactly? The suppliers are doing the work, so ATs role is essentially project management, isn’t it? They get everyone together, create timelines, and ensure everything is done to schedule, yes?

            If not, then what *are* they doing?

          • swan

            Bob,

            Stop trolling.

          • Hamish O

            Bob , Snapper is not experienced at all. They have their own equipment, bit because their equopment is so poor, they, unlike Parkeon cannot fit into a Thales solution. At, possibly under political pressure were gnorant to this and let Snapper get involved any way.

          • Bob

            Hamish.

            It works in Auckland and Wellington and Korea now. So clearly the problem is not the gear.

            One can only assume there is something wrong with the process. Who are responsible for that?

          • Hamish O

            The problem is with the gear. It is:

            – Slow (takes ages to read)

            – Unreliable (“please try again”)

            – No on-line top ups

            – and most importantly, it cannot handle complicated integrated ticketing solutions like daily caps or distance based fares, as it is designed as a small-value purchase card that also carry’s passes.

            I am not sure about the use in Korea, but I do know that the system in Korea was introduced a long time ago – things have changed.

            However you are right that there was “something wrong with the process”, and ultimately the fault will lie with AT, as Snapper cannot be blamed for trying to satisfy their own commercial desires.

            The question that remains is if Brian Rudman is correct in saying that there was some kind political interference (he make reference to Bill English being a friend of an Infratil director). Obviously there will have to be a proper inquiry.

            For now, however, I hope AT focus on just getting the system working, and fast.

          • Bob

            It isn’t slow in Wellington. Perhaps Aucklanders sprint onto and off the bus?
            Unreliable? Please try again? How do you know the Thales card doesn’t behave in the same way in terms of reliability?
            You can top up online in Wellington.

            I understand the systems can handle whatever you program them to handle. They are just computers and data cards at the end of the day. No vendor has some special magic card.

  • SJC

    Keep your eyes peeled for Thursday apparently…

  • Bob

    Swan,

    Reasonable questions, one would have thought?

    • Bob, no mystery, meddling government…. or why is Rudman and the Herald not getting the Collins libel lawyers on their collective arses?

      • Bob

        Perhaps they have better things to do? It doesn’t therefore mean they agree/disagree with what he says, does it.

    • swan

      Bob,

      The mark of a troll is not that they are unreasonable, but that they continue to peddle their faux reasonable lines without actually responding to the discussion.

      • Bob

        Swan,

        Who’s job is it to ensure Snapper and Thales and the other suppliers deliver whatever they have to deliver on time?

        AT, yes?

        So why are people pointing a finger at one vendor? It is the project managers job to ensure the vendors hit their targets, isn’t it? There would be multiple targets to hit along a project timeline, not just one big delivery that either sinks or swims right at the end, surely?

        Perhaps I’m missing something, but I don’t get it.

        • Doloras LaPicho

          Bob, you are an astroturfer sent by Zane Fulljames or one of the other clowns at Infratil to attempt to muddy the waters on Snapper’s clear attempt to subvert the tender process and then act like a dog in the manger to drag the Thales system down.

          • Mike

            The only way that any party could subvert the tender process is if the project manager allowed them to. The project manager being AT means that it’s AT’s problem, for them to solve.

          • Bob

            No one answers the hard questions.

            I guess the truth will out eventually.

          • swan

            Mike,

            Agreed it certainly is AT’s problem to solve. Whacking a subversive contractor with the biggest stick they can find sounds like a good idea to me.

  • I have “given up” in this Snapper debate – not here at this blog but in general. Just say war-weariness has caught up to me and is distracting me on other things I like to focus on more enjoyfully such as the CRL and Urban Design (RE: The Auckland Plan).

    I shall leave you more than able guys to carry on the good fight – all the best :D

  • Crusader

    So Snapper at long last are getting the shove. What irks me is that there is talk of them getting compensation….what?!? Compensation for contesting the tender process? For promising (but clearly failing) to deliver a compatible system? For deliberately stuffing up the standards process? And if there is compensation I presume there will be a hush clause that prevents us from ever hearing the truth behind their actions.
    Wellington bureaucrats must be shaking in their boots; with GWRC announcing they are to buy a system compatible with the same NZTA central solution in use in Auckland, my guess is that Snapper are going to use their “compensation” money to lobby for their system to be used in Wellington (for GWRC that is).
    I can feel a Tui billboard coming any minute….

  • Crusader

    I wonder if that means Thales and Parkeon are chasing money too? One wonders how much further into the mire this can go!
    My understanding from people at NZTA was that it was Snapper who were pushing to change the standards so they were easier to comply with. Hardly justification for compensation so it does make you wonder what is really happening.

  • Ha. Saw a big new Snapper billboard up on Albert Street today…

  • Tom

    Speculation: Mike Wilkinson and “Bob” are one and the same.

  • Bob

    There is no-one like Bob :)

    Heaven forbid two people hold the opinion that perhaps the project manager might have some responsibility towards….a project being managed effectively.

    The horror.

  • Mike Wilkinson

    Hi guys,

    On a slow day at work, I just happened to check what was being said on here. I reply with confidence that Bob and I are not the same bloke: I have absolutely no idea who he is, while I myself have written extensively on payments before. (Have a read of this Kiwiblog post, as an example: http://www.kiwiblog.co.nz/2011/08/guest_post_payments_and_public_policy_the_case_of_nzs_eftpos.html.)

    Since you are bothering to wonder who it is opposing you, I take it you’re feeling insecure about your arguments. You’re starting to realise that you haven’t been wondering why AT are unable to sort out what has only ever been their project. I’m sorry that I can’t make you any less insecure: since Day 1, I’ve been wondering the same. ;-)

    Cheers,
    Mike

  • Louis M

    I don’t think anyone is trying to defend AT here. If the public were actually given more information then perhaps we could lay the blame quite clearly.

  • Mike Wilkinson

    Hey Louis M,

    There is trying to defend AT and there is believing everything the organisation says or implies.

    It’s been a good while since I commented about Snapper’s technology, but I’m still enjoying it. While in Wellington recently, I purchased a 2degrees’ Samsung Galaxy S3 with the Mobile Snapper/Touch2Pay service. Having used it a bunch of times in Wgtn, I think it’s a big pity Snapper is accepted more widely up here. Those who complain so vehemently about Snapper are risking getting left behind when it comes to new technology.

    Cheers,
    Mike

    Cheers,
    Mike

  • You had so much money loaded on snapper (earning Infratil interest) and a new enough phone to enable you to have Mobile Snapper that you used it to go buy another smartphone? You’re mad.

    I have this thing of the future called a credit card.

    The sooner we see the back of Infratil earning interest on everyone’s money the better.

  • Mike Wilkinson

    Hey Michael,

    I don’t know if I’m mad, but I don’t actually put much money on either my Snapper card or my new Snapper account on my Galaxy. Furthermore, I don’t know of anyone who does – I believe the maximum balance is about $300. Especially when compared with the cost of setting up and running a new payment system, it doesn’t take an expert in finance to guess that the interest earned off any balances left on cards is sod all!

    As for Infratil earning money off of people, they’ll only get it if they provide a service that people wish to use. If people don’t like Snapper then Infratil won’t earn any money, will they? Welcome to the world of capitalism – feel free to come join us at some stage soon. ;-)

    Cheers,
    Mike

  • I’d suggest that interest on all snapper users $20 bus money would be a pretty good return for doing sfa. Why else would they/you be dragging this change over out…

    • Bob

      I suspect it’s SFA.

      And if you’re that worried about it, don’t put any more money on a card than you need to do so in order to travel that day/week/month. The alternative is handing it to some bus company in exchange for a paper ticket, isn’t it? Same difference – they have your money, you have a future right of travel.

      The arguments against Snapper make no sense to me. What would they have to gain by missing deadlines? It’s not as if they are going to win a contract that has already been awarded and the money spent.

      • Hamish O

        Common beleif is that Snapper can’t meet deadlines for technical reasons, not political ones.

        • Bob

          Why can’t they meet them?

          • Hamish O

            I may not be able to answer you’re question very well, as I am not an IT person, but here goes:

            – Snapper readers take longer to read cards than is acceptable in the NZTA set standards.

            – Snapper systems in buses are not networked, so on-line top-ups, also required, are impossible. I am not sure how Parkeon is handling this for the other bus companies, so don’t ask (but I assume it is over the mobile network, and WiFi at major stops).

            – The small purchase design of Snapper makes it difficult to integrate it into a proper integrated ticketing solution.

            Obviously these are only obstacles, not concrete barriers, but nerveless I believe Snapper is struggling to integrate, and certainly it is a huge push for them to be ready for November as they promised as a condition of their early launch with the HOP brand name.

            Also, in response to when you said the interest Snapper/AT earns will be “SFA”, I think this is incorrect as Snapper basically offered to roll out their system over all of Auckland for free. This would be paid for by the interest, plus the part of the top up fee they keep. In fact, interest from the float is all that keeps Snapper commercially profitable currently. Control of the float is one reason that the Thales solution was such a better option, and is the reason that (unfortunately) the HOP card will not be designed for use out of Auckland, as the interest from different areas would not be differentiable.

          • Bob

            Where is the evidence Snapper cannot meet the requirements?

          • Hamish O

            There is not evidence. Everything is confidential, everyone (including you and I) are just guessing.

    • Mike Wilkinson

      Michael, careful not to show your ignorance of finance. You put $20 in a term deposit in the bank and you’ll only earn 3% p.a. Yes, corporates will get a better rate than that, but they also pay tax on their income from it.

      3% of $20 works out at the whopping big figure of 60 cents. Now figure in the costs of running a whole payment system, issuing the cards, coordinating the buses and the merchants, dealing with all the stuffed up complaints, what do you have left? As I said before, sweet sod all!

      As Bob says, the arguments against Snapper make no sense at all. Your passionate dislike for the company means you guys just can’t see that.

      Cheers
      Mike

  • Harry McDonald

    Do “Mike” and “Bob” ever contribute to any article other than ones on snapper?
    I wonder why?

  • Mike Wilkinson

    Hamish O, I’d be very careful before I placed any stock in “common belief”. For example, why would Snapper’s small purchase design cause any obstacle for it to integrate? Given that all public transport payments are really just small purchases, I’d have thought this was an advantage.

    Furthermore, Snapper is essentially a network business: it would be a remarkably foolish thing to believe the company is currently profitable, even while it’s still trying to get itself established, much less that retention of any float was all that was required to make the company so.

    Is “common belief” every foolish? Well, once upon a time, the common belief was that the world was flat. I’d recommend not making the same mistake they did back then.

    Cheers,
    Mike

    • Hamish O

      The whole reason I quoted it as “common belief”, and not “fact” was not to have this conversation. Referring to the world being flat however really is a bit silly on you’re part Mike – it shows weakness.

      I would like to, however, focus on one thing you’ve said:

      “all public transport payments are really just small purchases”

      I strongly disagree.

      Our current system is structured this way, and it sucks. AT is designed a new bus network that integrates into the train network and makes use of high frequency routes requiring transfers between them. The reason this new network will be possible, however, is to do with Integrated ticketing. Don’t confuse this with electronic ticketing. Integrated ticketing involves many ways of paying that are not like small purchases in a shop. There might be distance based fares, zone based fares, time based fares, or daily/weekly/monthly caps. These kind of things, I believe, but cannot confirm, are the type of things that Snapper is not made for, and hence possibly struggles to integrate with. Of course this is just software, but all I said id that it might be a barier to Snapper complying in a timely manner.

      But Public Transport is NOT a “small purchase”.

      • Mike Wilkinson

        Hamish, can you define a small purchase? I was thinking about anything below $10

        • Hamish O

          Sorry, in my original comment is should have been more specific.

          I define small purchases, probably incorrectly, as being single items purchased at a price that is completely independent of any other purchases on that card.

          Proper integrated ticketing is more complicated than this.

          It seems that Snapper’s system is designed for small purchases, as I define them, which I believe is one obstacle to their success in integrating with the Thales System.

          The other two barriers I mentioned though are probably more problematic, but all we can do is guess any way, so who really knows?

          • Mike Wilkinson

            Hamish,

            Ignoring your definition of small purchases, which looks very odd, Snapper has already Shown itself to be capable of “intergrated ticketing”, as you’ve defined it. Snapper cards are already be used for transfers between buses in Wellington. You’re going to have to be much more specific than n that, if you want to be convincing in your arguments on this point.

            Cheers,
            Mike

          • Hamish O

            Yes, sorry, by small purchases I really meant simple purchases that have prices independent on other activity.

            By integrated ticketing I mean more complicated time, distance, zone or cap based systems, not just a few routes with free transfers.

            I am sure it is possible for software updates to make such things work with Snapper, but I was only suggesting, under the very limited information we both have, that it was possibly a barrier to Snapper being ready on time as they are contractually obliged.

  • Mike, Snapper are putting NZ$60M through their bank accounts a year and at least in Wellington, their main source of custom is their sister company NZ Bus. Yes technology costs money to maintain but having a serious pot of cash to look after must learn some interest at the bank, even with the current historically low interest rates.

  • Bob

    Are they? What are their costs?

  • Mike Wilkinson

    Come on, Pete, you can’t be serious. It’s public information that Infratil thought it wasn’t going to be profitable unless it managed to get Snapper operating in Auckland. If it was really that easy to get a network business going, every man and his dog would be doing it, right? Plus women too!

    Open your eyes, guys! AT are trying to pull the wool over them.

    Cheers,
    Mike

    • Bob

      So Snapper have a strong incentive to deliver.

      So……is the holdup coming from elsewhere?

      • Hamish O

        I believe (but yes, cannot prove) that Snapper is not delivering fast because of technical barriers, not from any lack of incentive.

        Parkeon is also held up, but it is Snapper hogging the brand name HOP that Thales is ready to use on trains.

        • Bob

          Sounds like speculation to me.

          I find it difficult to believe a computer would be challenged by doing such simple calculations. In any case, critical technical issues would be flagged a lot earlier, surely.

          • Hamish O

            Correct Bob, it is all speculation. We will just have to wait and see as to if Snapper can integrate with the real HOP or if NZBus terminals will have to replaced.

            I believe the technical issues snapper faces were flagged, but internally, as it is commercially sensitive information.

    • Hamish O

      Mike, a payments system needs to have a high output to compete, as the business makes good use of economies of scale.

      This means high barriers to entry, which explains why “every man and his dog” is not doing it.

      I believe Snapper hasn’t had the success in the Wellington small purchase market it was hoping for, hence the leaked board report suggested expansion into Auckland was necessary for them to be sustainable long term.

      This explains perfectly why snapper is fighting tooth and nail to have at least some participation in Auckland’s integrated ticketing.

      What it does not do is suggest that interest from the float is insignificant – it’s more like a mini Visa or Mastercard, smaller profits, but still profitable with 2 cities.

      Unfortunately for Snapper it doesn’t look like their outdated technology will have any role in Auckland, and maybe one day electronic ticketing from GWRC or natural economics will see it gone from Wellington too.

      • Bob

        Is Thales “up to date” technology or old technology?

        • Hamish O

          It is probably soon to be outdated by new systems overseas where banks can provide their own cards / NFC chips, but otherwise is probably newer and defiantly much better suited to Public Transport solutions than the old Korean technology Snapper is based on.

          • Bob

            Is it? You know this, how?

            Is it possible Thales are having problems integrating? Don’t they have to meet a standard, too? What’s teh word on that?

          • Hamish O

            I believe, but obviously cannot confirm, that Thales has met the standard, and are ready. The standards were also based on a Thales contract for the back-end system, so this makes it very unlikely that Thales could have a hiccup like Snapper and Parkeon (to a lesser degree) have.

            By ‘better suited to public transport’ I am referring to the fact that the current (note the work CURRENT) Snapper system seems more suited to buying coffees than handling complex Integrated Ticketing Schemes with multiple operators. Snapper could still write enough code to fix this and prove me wrong.

          • Bob

            If you can’t confirm Thales has met the standard, then you appear to be making an assumption? I’ve been hunting around the news archives, but can find nothing on this point. Does anyone know for sure?

          • Hamish O

            Yes, it is an assumption. Yes, no-one knows for sure. But all the media has suggested that Thales is ready.

      • Mike Wilkinson

        Now you’re getting (a bit) closer to making sense, Hamish O. As well as your obvious desire to talk about things ou have no idea about, your downfall is that you don’t realise that payment instruments aren’t like the latest iPad: it takes a long time before people stop using their cards and cash and start paying with something new, instead. If Infratil expected people to suddenly start using Snapper, it’s its own silly fault if it doesn’t make money.

        When I referred to every man and his dog, I of course meant this figuratively. It would have been jolly sexist if I’d meant it literally. If Joe and Jill Blogs haven’t the cash to do it, what’s to stop their local bank from having a crack? Surely theyre not short of cash.

        Cheers,
        Mike

        • Hamish O

          Mike, I think the difference in our perspective her is that you are focused on a micro-payment system. I (and others on this blog plus AT) are focused on getting a system for Auckland’s PT. In PT people will uptake a card quickly. As using the card speeds up boarding the operator will offer lower fares (an incentive) to those using the card.

          In terms of micro-payments, however, I feel banks are ‘having a crack’. Visa/MasterCard both offer contactless ‘one-touch’ versions of their debit cards, which allow the banks to make money (yes profit) by holding people money that they would otherwise have as cash for them. Perhaps you can expand, as I know this is your field of expertise.

  • Bryce

    So Mike, capitalism, where an unsucessful tender applicant goes crying to a govt minister even after loosing in court?

    • Mike Wilkinson

      Whatever, Bryce. Given the tender involved AT deciding to do something for $98 milillion that someone else was willing to do for free, it hardly involved anything that might be called capitalism. I just feel sorry for Auckland ratepayers.

      Cheers,
      Mike

      • Hamish O

        Mike, Snapper really wasn’t an option because their technology was old, and more importantly it would give NZBus access to all of their rival operators boarding data, allowing them to pick the best routes.

        If Snapper had proposed a de-merger from Infratil (like Telecom and Chrous), and proposed new technology, their offer to do it for free and hold on to the interest may have gotten more consideration.

        • Bob

          What has “old” got to do with it? And if you discovered that the Thales system was older, would this change your argument?

          You might want to do some reading….

          • Hamish O

            I said ‘old’ to cop out of explaining AGAIN Snappers technical failings.

            Here Goes:

            – Slow to read

            – No networking

            – No evidence of ability to handle proper integrated ticketing schemes

            These can all be fixed, but Snapper didn’t propose fixing it, but simply distributing more of what they have in Wellington.

          • Bob

            Slow to read: it’s not in Wellington, so how can you claim it is in Auckland? Are Thales reading faster? How about Parkeon? Specifics, please.
            No networking: is it a requirement to be networked?
            No evidence of ability to handle proper integrated ticketing schemes: It seems that no one in Auckland can. Yet. Korea, yes. Wellington, Yes.

            Auckland…..

            What’s different about Auckland?

          • Stu Donovan

            From what I read Snapper swipes take 600ms, whereas Thales system takes 300ms. Now a 300ms difference per swipe may not sound like much, but when you multiply it across all the passengers every day, all day it adds up to quite a bit of lost time. Approximately one minute per bus trip actually, which equates to about a 1-2% increase in running time assuming a 30-60minute trip time. So Hamish is correct when he says that Snapper is slow.

            And Bob there’s actually no need to “read” anything – you can actually test the systems out in person. I have used the Thales system in Amsterdam and from my experience can conclude that it’s much faster than Snapper. And reads much better too – less errors and stronger signal.

          • It’s slow to read in Wellington. It’s conspicuously slower than Parkeon’s Dunedin, and Calypso’s Lisbon solution.

  • Mike Wilkinson

    Hamish, for someone who has already admitted they’re not into IT and has also shown a remarkable ability to talk about things they don’t have a clue about, you are remarkably confident that the Snapper solution is inadequate. Hopefully, you’ll understand if I ask for something that backs up your claim. Since the Koreans already make a goer of Snapper’s technology, I have a strong degree of skepticism about your claims. They’re not yet more “common beliefs” are they?

    Cheers
    Mike

    • Louis M

      Come on Mike you continue to make ridiculous statements yet you fail to declare your conflict of interest.

      • Mike Wilkinson

        Hey again Louis,

        How have things been going? I’m really not one for saying ridiculous things. Your challenge, should you be up to it, is to find one statement I’ve made, anywhere on this blog, that might be called ridiculous.

        Also, I’ve said before that I have no and have never received money from Snapper or Infrail. If you want t stalk about a conflict of interest, better stump up with some evidence. I just back Snapper because I think it has an interesting technological solution that will succeed where so many other payment systems have failed before. We shall see if I’m right about that.

        Cheers
        Mike

    • Stu Donovan

      Yes Snapper have “made a go” of it in South Korea – as Thales have done in Amsterdam. But the important question is which technology delivers the better economic outcomes for NZ? Or more specifically is the $98 million in additional costs offset by commensurate economic benefits? Let’s run through what the potential benefits of Thales ticketing solution might be:

      1. Faster, approximately 1-2% faster actually. So let’s calculate direct annual operating cost savings in Auckland on a $200 million annual spend @ $2-4million p.a. = ~$20-40 million NPV.
      2. It’s also faster for all the passengers onboard the vehicle. Let’s say 80 million PT trips/year (average for next 10 years) and an average in-vehicle travel time of 25 minutes. That’s about $500 million of time spent annual on PT vehicles, of which saving 1-2% = $5-$10 million per year = $50-$100 million NPV.
      3. Float is owned by Government. So let’s say that at system maturity there will be 500,000 cards (remember that HOP card will be rolled out to parking too) with an average balance of $20 dollars = $10 million per annum float @ 5% = $500k p.a. = $5 million NPV.

      By monetising those three benefits alone (there are likely to be may others that I did not consider) we have go to $80-$150million in economic benefits from the Thales system. Just taking the mid-point at $115 million still leaves us in excess of the $98 million in costs. Now what about the non-monetary benefits:
      – Access to passenger information. The HOP tag on/off data is GOLD for PT planners. It will help them to optimise the network so much more than in the past. Having this information locked up in a private company would remove one of the major indirect benefits associated with integrated ticketing.
      – Technological resilience: The Thales technology seems to be of higher quality, so there may have been differences in the cost of renewals etc.

      The thing is Mike, analysis of this kind (but in more detail) would have been undertaken by ARTA, NZTA, and possibly also MoT/Treasury during the tender process. So obviously there was a compelling economic case to go with Thales. If there wasn’t then I’m sure that Joyce would have happily overturned the decision and gone with Snapper.

      The phrase “get over it” springs to mind.

      • Mike Wilkinson

        Hey Stu,

        Neither Bob nor I feel so insecure sbout our arguments that we need to write nine paragraph novels in reply to comments on this blog. I really don’t think we’re the ones who need to get over it. :-)

        You guys need to look in the mirror: sometimes your enemy isn’t your opposition, it’s yourself.

        Cheers,
        Mike

  • Mr Anderson

    I think that’s quite enough astroturfing and concern trolling for one day Mike & Bob.