Part 3. David Levinson’s CityLab discussion on transit: Farecards and technology

Today I continue with my response to David Levinson’s How to Make Mass Transit Sustainable Once and For All. Monday I discussed the institutional structure Levinson suggested. Tuesday I discussed competitive tendering.

Today I want to take up smart cards, as this suggestion from Levinson confuses me a bit:

3. Transit utilities should require smart card use and encourage seasonal passes (perhaps subsidized by employers and universities as a benefit) to lower the marginal cost paid by transit users, reduce boarding times, establish a more stable revenue base, and increase ridership. This is much like unlimited minutes (or bandwidth) by your telecommunications provider.

Most transit companies already do require smart card use, and I’m not sure what seasonal passes get anybody, even providers,that monthly or weekly passes don’t, except if you buy for longer periods of time, the transit company gets to use your money longer than if you buy week-by-week. The only thing I think might matter here are school-year passes that, if you purchase them in August, you can a better deal than if you buy month-by-month, and you don’t necessarily want a full yearly pass. It probably makes more sense, for example, for me to buy a pass like that than my yearly pass because I don’t commute much in the summer. Unless I am missing something, this is a minor point.

There are issues surrounding technology that I strongly suspect Levinson is thinking about but not explaining due to the format’s brevity requirements, and fare cards are a good example. We know that transit is a field that could benefit substantially from technology. But, privatization advocates argue, quangos have very little incentive to invest in technology that serves customers since they have little reason to fret about customer service. As a result, transit providers tend to invest in technologies that make their lives easier but do not prioritize technology adoption that serves passengers. Farecard actually are an example of that. Transit agencies use electronic fare systems to make collecting fares much more efficient with smart cards. As Levinson notes, these make boarding much faster and helps agencies stick to on-time performance goals since you don’t have people fumbling with change.

In so doing, however, different transit agencies within regions have adopted myriad different smart cards and card readers, and few have cards that work across multiple systems. As a result, farecards are usually much less easy for passengers to use across systems than the technologies really should allow. For transit managers, farecards for their own systems serve their ends: lower dwell times and easier revenue collection. But for individual agency managers, making the cards readable across multiple transit systems represents extra work and, probably, concessions that benefit the passenger rather than their agency. The coordination would require managers to negotiate with other agencies, and perhaps even change their own agency’s reader technologies to suit other agencies’, all to help customers. As a result, the innovation for customers’ benefit takes quite some time to occur, if it happens at all.

Privatization advocates point to how easily similar information and coordination problems have been resolved in the private sector, such as with different banks sharing automated teller machines (ATMs), in ways that critically improve customer service. Skeptics of privatization note that these perceived benefits of privatization represent cherrypicked examples, and that many of the so-called innovations of the private sector took far longer than privatization advocates allow, and that competition does not always lead to innovation or provide consumers with better technologies or more compatible systems. There are many examples of private companies, particularly software companies, that attempt to dominate their markets by refusing to make their products usable with their competitors’ products, to the detriment of consumers.