IS SIMPLYGO A CASE OF PUTTING LIPSTICKS ON A PIG?

SimplyGo has been derided as taking one-step-forward-two-steps-back or a case of fixing something that ain't broke. Some pilloried the government for the inability to come up with a one-payment-card-for-all solution. Is SimplyGo "putting lipsticks on a pig", a term that refers to making superficial or cosmetic changes to a product to make it seem like a new one.

The contentious issues are SimplyGo (a) does not immediately display card balance on MRT fare gates and bus card readers when tapping in and out; (b) cannot be used for motoring (carparks and Electronic Road Pricing gantries). 

I will deal with two areas. One, is on the system. Many have written on this but I have not been able to find one that explains comprehensively. There is much confusion. To this extent can be attributed a failure in change management - the new product have not been sold to the public. Two, and this is what readers expect of this blog - a discussion of some issues no one talks about.

Talking about systems, it is impossible not to hit you with an array of geeky acronyms. With apologies in advance.

Before SimplyGo :

NFC : Near Field Communication - this is a technology that allows an NFC scanner to read data from another NFC device at a very short distance of about 4 inches. New smart mobile phones, smart wearables, EMV cards and other smart cards are NFC enabled. NFC does not require pairing like Bluetooth or passwords like Wifi. Simply hold the device near reader and end-to-end transaction is completed in micro seconds.

RFID : Radio Frequency Identification - this is a technology more or less similar to NFC but the scanner is capable of reading smart cards at much greater distances. This is used in motoring (carparks and ERP.)

TransitLink : Entity owned by train and bus operators SBS, TIBS and SMRT to integrate ticketing of the public transport system and manage ticket sales.

CEPAS : Contactless e-Purse Application - this is a Singapore specification standard owned by Enterprise Singapore. It is adopted in Nets FlashPay and EZlink cards to enable interoperability of transit ticketing and motoring. 

Nets FlashPay : It is a protocol that enables contactless direct debit-credit payments at point of sales Owned by DBS, OCBC and UOB. Nets FlashPay cards are stored-value cards used for motoring and retail stores. By incorporating CEPAS, Nets FlashPay cards can also be used for transit ticketing.

EZlink : It is a protocol that enables contactless direct debit-credit payments at point of sales. Owned by LTA. EZlink cards are stored-value cards used for transit ticketing and retail stores. However, it has very limited merchants. By incorporating CEPAS, EZlink cards can also be used for motoring. 

Concession cards : These are contactless stored-value cards for use on trains and buses.

Tourist Cards : These are contactless time-based cards for free travel on trains and buses for limited number of days.

Standard Tickets : These are single trip cards. High physical infra cost are required and usage had fallen drastically. These tickets were no longer issued by 2021.

Closed Loop : This means the cards are proprietary and cannot be used elsewhere. All the cards in use are closed loop.

Prior to SimplyGo, the Singapore transit ticketing system was legacy card-based system. This is a system that uses stored-value cards. We have long gone past magnetic stripe technology and moved to smart cards. The use of smart cards that hold a microchip allows for NFC contactless technology. It also allows for frontend debit/credit computations, enabling for card value balances to be displayed almost immediately on the train fare gates and bus readers upon entry and exit.

Card-based systems are proprietary systems which are monolithic, with high investments in infra, technical HR, and maintenance. It is also difficult to scale and costly to make changes. The system does not capture data of travel patterns of the public.

After SimplyGo (2019)

SimplyGo : This is an account-based transit ticketing system for train and bus services. It is an SaaS developed and managed by Acclivis Technologies and Solutions for LTA. It is the back-end ICT (information communication technology) infrastructure which uses IBM technologies that cut across IoT, AI, big data, cyber-security and predictive analytics.

SaaS : Software as a Service - it is a software distribution model in which a cloud provider hosts applications and makes them available to end-users over the internet.

Cloud computing : It offers on-demand availability of computer system resources, especially data storage and computing power, without direct active management by the user. Deployment is not location constrained as long as internet is available. Development is modular in contrast to monolithic proprietary systems.

Open Loop : SimplyGo is an "open loop" system which means that it leverages existing open tokens and processes that are not proprietary to the transport network, allowing for the use of credit cards, mobile phones and wearables as contactless devices. 

SimplyGo-EZlink card : This is the EZlink card upgraded for use on SimplyGo. It no longer adopts CEPAS standards.

EMV : This is a technical standard used in payment cards of Europay, Mastercard and Visa. EMV cards are contactless credit cards.

e-Wallets : This is basically an app that contains a file holding your information such as bank account number, pay card number, password, name, etc that allows you to make payments from an account hosted somewhere.

Digital wallets : These are e-wallets that enables you to access your payment account to pay for transactions online.

Mobile wallets : These are e-wallets that enables you to access your payment account to pay for transactions in the physical world.

The Pays : A collective reference to Google Pay, Apple Pay, and Samsung Pay. Some smart phones come with built-in apps that allow you to set up mobile wallets where you set your bank account and/or credit card details. Your mobile phone is the contactless device that you simply hold near the vendor's scanner to make payment. There is no need to key in account numbers, PIN, passwords, etc. The Pays allow you to make payment directly from bank accounts or credit cards.

Concession cards & Tourist Cards : These remain in use.

SimplyGo went live in 2019. It is account-based cards built on cloud computing which also allows contactless credit cards and smart devices like mobile phones and wearables. Currently it runs parallel with card-based NETs Flashpay and EZlink (which includes concession and tourist cards) until these are withdrawn. According to Transport Minister Chee Hong Tat, about 30% of riders have already switched to SimplyGo. (No details are provided, but I suspect majority are those who like to use mobile phones and wearables as their contactless devices.)

Account-based transit ticketing is like a new era for transit operators. We have been told London and Singapore are the only two countries having this. Too bad London beat us to the coveted first spot. Masabi, a US-based SaaS vendor, did a survey with transport agencies which showed 22% of respondents have already deployed account-based transit ticketing systems, 24% will deploy and 24% are at the research stage. I cannot get behind the paywall so I do not know who the respondents are, what are the numbers, and what countries. Is Singapore really number 2 and does it matter?

SimplyGo Back Office at Acclivis

Who developed SimplyGo? Some report name LTA, others say TransitLink. Acclivis Technologies was contracted by LTA to develop and manage SimplyGo. Acclivis is a local company which started out as a software house owned by Singaporeans and has now grown into a formidable SaaS vendor. In 2015 it was acquired by CITIC Telecom, a company listed on the Hongkong Stock Exchange. So now a foreign-owned Singapore company has a product that is most sought after in transit services all over the world. SimplyGo is a cutting edge tech project that will put Singapore on the forefront as a smart city. It's no secret that technology companies receive significant grants and soft loans from Enterprise Singapore, a government agency. Here's to guessing if Acclivis availed of such financial support and how much. 

LTA announced this month the EZlink cards will cease to be used by 1 June 2024. This drew public outcry mainly on the point card balances are no longer displayed on MRT fare turnstiles and bus readers immediately on entry and exit. Official explanation is debit/credit computations are no longer done at frontend equipment but at the back end where the accounts are kept. Technically it can still be displayed but will take a few seconds. This is unacceptable in a heavy traffic and fast moving environment. That is why it was designed not to display. 
 
Mr Chee pointed out the London system too does not have immediate display of card balance. This is a non-sequitur and it's amazing the defensive Minister would attempt to pull this one out.

In light of unexpected public outcry, Mr Chee recently announced a policy flip flop. The 1 June 2024 dateline is off. To accommodate the public's demand for immediate display of card balances, the government will pump in S$40m to be used for hardware replacements and systems maintenance required to extend the use of EZlink and Nets FlashPay cards. There is a pinch of petulance methinks. Much clarification is needed :

(1) What additional hardware is required when existing train fare gates and bus readers are currently used for both card-based (EZlink and NETs FlashPlay cards) and account-based (SimplyGo-EZlink cards). In fact, in it's initial plan, concession and tourist cards would continue after 1 June 2024. These cards display value balances. It means the same hardware will still be in place. It's a discombobulation. 

(2)  The modularity of cloud computing has a huge cost advantage in maintenance. It seems to me to tweak the system to display balance immediately for SimplyGo-EZlink cards is a matter of adding the debit/credit computations at only the frontend module, the way it is currently doing for EZlink cards. This doesn't seem like a S$40m job.

(3) Netizens ask if S$40m is for maintenance and hardware, what is the cost for the whole SimplyGo project? Here I am speculating. There is no investment cost for LTA or transit operators. Acclivis is the SaaS vendor contracted to design and manage SimplyGo. Vendor earns on a pay-as-you-go fee basis, using some formulae such as number of trips, registered riders, etc. It is similar to toll charges where where the government pays nothing for road construction and contractors earn from toll collection. (Singaporeans are not familiar with this as we have no PPP projects).

(4) If project development is free, why the S$40m maintenance cost? The reason is frontend debit/credit computation for SimplyGo-EZlink cards was not in original specifications. You want new functionality, you pay for it. That's basically Mr. Chee's innuendo, as if it's the public's fault. 

(5) So why was the frontend debit/credit computation for SimplyGo-EZlink cards left out in the first place? I suggest 2 reasons. (a) No survey of riders' preferences. (b) Frontend computation was unilaterally considered redundant since same is done at the backend for the accounts. They had London as precedent.

One of the advantage of SaaS account-based system over proprietary card-based system is cost. This is very true of new entrant transit operators. For systems already in operation, the Masabi survey showed ticketing takes up to 10%-20% of operating cost. At this level any significant cost savings on ticketing does not seem to be able to translate to high savings in total operating cost. Cost does not seem to be the driver for change. 

As SimplyGo allows riders to pay fares by credit cards and direct debit to bank accounts, the nature of transit operators has changed to that of merchants. They are now involved in millions of mircro payments per day either through the ACH (automated clearing house) or credit card companies. How much merchants' transactional cost has been passed down to riders in the last few fare increases?  

As mentioned, SimplyGo is a SaaS project, so the financials work as in 'toll gate'. Vendor gets paid on some formula of usage such as number of  trips. The first few years normally carry a higher rate for vendor to recoup development costs. The rate subsequently tapers off. Again, if I am correct here, how much has this been reflected in recent fare increases?

There are several other minor benefits for transit operators and riders which I do not cover here. For example, by using SaaS, transit operators leave ticketing systems to market specialists and focus on running  trains and buses. The major driver for operators seems to be accounts-based system captures vast amount of data of the public's travel patterns. Big data analytics may provide useful information that can assist in policy making.

One casualty of migrating to SimplyGo is NETs whose Flashpay cards will no longer be used as SimplyGo has abandoned CEPAS. There is thus no interoperability between motoring, trains and buses. The reason for this may well be commercial. Everybody wants a slice of the merchants pie. NETs has basically cornered the market. It is possible transit operators see SimplyGo cards an opportunity for a new market to earn some fee income.

Is SimplyGo a step in the right direction? One thing is for sure, businesses must never get left too far behind in technology. As a matter of fact, SaaS is no longer nouveau, and account-based system is gaining ground. The next frontier in transit ticketing systems is MaaS.

MaaS : This stands for Mobility as a Service. It integrates various forms of transport and transport-related services into a single, comprehensive, and on-demand mobility service which offers end-users the added value of accessing mobility through a single application and a single payment channel.

Think of trains, buses, taxis, ride-hailing services, electronic road pricing, carparking, bike-hailing services, all coming under one single platform. That would be a heck of many notches up as a smart city for Singapore - one orgasmic dream for techno-bureaucrats.

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