Smartspace Software Share Discussion Threads

[garth] 18/4/2006 07:39

Badday,

Great piece - thank you. Found this particularly interesting with RBS partnering Ecebs and jointly sponsoring a recent Smartcard event.....

"But Londoners won't be the first to embrace the cash-less society. That honour goes to Edinburgh, where thousands of staff at Royal Bank of Scotland's HQ are piloting Paypass, a new low-cost item payment system that goes one step beyond Oyster. The plan is that holders do not even have to take the card out of their pocket or purse.

It works by radio transmission when it's close to the retailer's contactless reader attached to chip and pin card terminals.

The authenticity of the card is validated from its processing chip. But there are security measures - so there will be occasional prompts for a PIN.

The pilot will run within RBS's sprawling HQ, which includes a number of shops and eateries.

RBS's partner, Mastercard, calls it "the war on cash" and is designed to make under £10 card transactions profitable.

Mastercard expects it to be used in historically cash-only locations such as convenience stores, fast food outlets, vending machines and parking meters."

[garth] 09/4/2006 08:41

Piece from Public Technology.net with a bit more info on the South Western franchise. The franchise is operational in 10 months time (February 2007) and as the smart-ticketing has to be in place by 2009 I guess we might see orders placed before then? SMRT's current forecasts jump up in 2008.....


Smart ticketing & Oyster cards are planned for South Western rail franchise
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This was published: 2006-04-03 06:50:00
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Rail passengers on the new South Western Franchise are set to be the first outside of London to benefit from smart ticketing, the Department for Transport has announced.

Bidders for the new franchise will be asked to set out how a new smart ticketing system could be introduced across the mainline franchise area from 2009 onwards.

The operator of the new franchise will have to ensure the new system also accepts existing Oyster products in London zones 1 - 6. This will ensure that future passengers can use Oyster Pay as You Go products as well as the newly available smart tickets.

In advance of this introduction a zonal fares structure will be introduced for single and return fares across the Capital's rail network.

The details are contained within the Invitation to Tender that has been issued to bidders for the new Franchise. It covers services currently operated by South West Trains and the Island Line on the Isle of Wight - both currently operated by Stagecoach plc.

The ITT specifies the minimum level of service the Department will require from the new operator. Bidders will be asked to show how they will meet the requirements it sets out and how they will ensure value for money for the taxpayer. The ITT is a commercially confidential document but further details on the specification and a synopsis of consultation responses are included in a stakeholder briefing document on the DfT website (see link below)

It details the minimum number of services the Government will require the operator to provide. This is based on the current timetable that has led to a marked improvement in performance. Only minor changes are suggested.

The specification will require bidders to address current and anticipated passenger growth and ensure that performance continues to improve. In particular they will have to set out how security at stations and on the trains can be improved where necessary.

Transport Secretary Alistair Darling said:
"As technology advances it is vital that we ensure that future passengers benefit from the improvements it can bring.

"Passengers on these routes will benefit from smart integrated ticketing across the franchise area - we will be working with train operators to ensure similar benefits can be introduced for passengers elsewhere.

"This is just one improvement the new operator of the South Western Franchise will be required to introduce. Additional capacity, safer stations and better pricing structures will all lead to a better service to passengers."

There are four bidders for the South Western franchise; Arriva Trains South West Limited (Arriva plc); First South Western Limited (FIrstGroup plc); Great South Western Railway Company Limited (a joint venture between GNER Holdings Limited and MTR Corporation Limited of Hong Kong) and Stagecoach South Western Trains Limited (Stagecoach Group plc).

The franchise will become operational on 4th February 2007 and will run for up to 10 years, the final three years being dependent on performance. The winner will be announced in Autumn 2006.

Travelcards on Oyster are already accepted by London train operators.

[garth] 09/4/2006 08:29

This piece from 06/04/06 on RFID and the use of Oyster for electronic purse transactions. Every place you can use Oyster in this way wil need another reader. Every ITSO reader needs an ITSO ISAM supplied by SMRT. As we know, the Government have said that they are in the process of making Oyster ITSO compliant. We also know that Oyster have delayed any announcement on electronic purse applications while they look at specifications. The ISAMs - backed by RBS are far more secure than Oyster.

The rise and rise of smart tagging

Radio frequency identification was once driven by the retail and manufacturing industries. But other sectors are recognising the benefits of introducing smart goods and processes into their business, writes Mark Dye.....

Analysts and users are also in agreement that RFID looks set to become a major enabler for data transfer.

Chase Bank recently issued 5,000,000 cards with RFID chips, enabling payment of goods below $25 (£14) to be made without the need for a signature or PIN. Users simply pass the card near a reader in a shop to purchase goods.

Roy Illsley, senior research analyst at Butler Group, says this will work like a credit card purchase, but with no paper audit – and the retailer will expect instantaneous transfer of funds.

'This demands a secure protocol between the card and reader, and also that communication between reader, bank and retailer happens,' he says.

London Underground's Oyster card works in a similar way, and will be expanded this year to include parking and small purchases from kiosks.

Illsley says RFID schemes place tremendous demands on a network that deals with huge volumes of data – London's Oyster readers scan up to 1,000 tags a second......

[nockybalboa] 08/4/2006 13:07

looks like the blokes over at www.fairshare.biz got it right again as usual, how do they do it

[garth] 08/4/2006 11:54

Thanks for your sensible comments once again Colsmith. I think WLF is a great point of comparison - albeit a different market.

G.

[igoe104] 07/4/2006 10:30

ceo intercede interview. wallstreetreporter.com all about smart cards id cards market.

[garth] 07/4/2006 08:46

Archa,

I've emailed about the 'gaming' comment. In order to give benefit of the doubt I'm assuming that that section is aimed at ethical investors and refers to the potential application in electronic purse. Using the software for electronic purse means clients could in theory use a smart card for gaming credit I assume.

G.

[archa] 07/4/2006 08:25

Re: Hoodless Brennan note, more errors. The first weakness listed refers to 'patients', some of the 27 of which have "... not yet been granted'" I wonder what; their full recovery perhaps! I accept that picking up on typographical errors is nit-picking but to refer to the 'Activities' as being "Provision of software that assists gaming activities." is a fundamental flaw.

Who writes this stuff and don't they read over carefully what they have written? Clearly not. I supposed nowadays anything goes.

Arch

[jonwig] 07/4/2006 07:35

garth - no, I didn't write the note: I wouldn't make such errors ...!

Noticed it whilst looking for something else, and remember you 'promoted' SMRT for me a few days back.
It's on my list of stuff to look at.

[garth] 07/4/2006 07:18

Interesting note. Potential £5m fom biometrics with US partner added to the content in the pre-IPO note.

Couple of errors - just nit-picking - it says they have no website: they have two, logos in the header are hyperlinked to these. Multefile - their core software - is spelt with an 'e' in the middle.

Just in case anyone from Hoodless is reading.....

G.

[garth] 06/4/2006 22:50

Jon,

Thanks for the link. Out of interest, is that note your work?

G.

[rcktmn] 06/4/2006 21:20

Just read it.. they give it a spec. buy rating which is fair anough..basically saying it needs a frequent run of contracts to come good. Any delays will hold it back..
I'm staying in for now..SP could shoot up on continued good news.. (imo)

[jonwig] 06/4/2006 19:10

Hoodless-Brennan has some new research (this week) on SMRT.
I can't comment on the usefulness, but their notes are often a good introduction to a company:

[bonty] 06/4/2006 12:27

Excellent find Garth, well done! :)

[rivaldo] 06/4/2006 10:18

Hi garth. Great research as usual. I've been away on hols and am just catching up with SMRT, triggered by your HYD posting.

235m shares in issue now, so a m/cap of £9.5m is quite rich for a value investor like me! The large potential is obvious, but maybe not for fruition for a while yet, with lots of room for banana skins along the way. At £9.5m SMRT is capitalised at over half of HYD's m/cap without anything like the same current value P/E or worldwide growth prospects.

Anyway, that's my gut reaction. I do like the company though. Which means SMRT will probably announce another contract and zoom to 8p...

[awilson] 06/4/2006 10:16

G.
Thankyou very much indeed for all the info. Can I check whether the £3m profit forecast stated for 2008 is an actual pre-tax figure - if so and even allowing for a little slippage, we are looking at eps of around 1p and a p/e of about four.
This could be a blue sky stock.

[colsmith] 06/4/2006 09:54

garth - thanks shows that commercially the only practical way forward is being adopted i.e. to have the country wide ITSO standard adopted whilst admitting of Oyster interoperabilty. And South West is the largest commuter franchise. Seems reasonable to assume that the introduction for trains will be the enabler for a much wider ITSO compliant usage intially in the South West area such as supermarkets etc as currently stated for Oyster. Could be a smoking gun for the comapny!

--------------
PARTICUALRY EXTRACTS OF RELEVENCE
Oyster e-money will allow commuters to use the smartcard to pay for low-value goods and services at newsagents, fast-food outlets, supermarkets and parking machines.

Bidders will be required to price the introduction of ITSO-compliant ticketing throughout the franchise area from January 2009, with an expectation that ITSO compliant ticketing products will be available for use in London zones 1-6 from that date.

[garth] 06/4/2006 09:38

Yummy. It doesn't get much clearer than this extract taken from the brief for stakeholders in the bidding process for the 2009 South Western franchise. SMRT's forecasts jump to £3m profit in 2008. I fully expect to see some of that slip into 2009 but this piece gives a good idea where some of that revenue will be coming from. It indicates that by 2009 London's Oyster scheme will already have been made ITSO compliant. It is made very clear that we are not going to have an either/or battle between Oyster and ITSO. This brief indicates that a successful bidder will be providing for both I wonder whether the delays in announcing where Oyster is going with electronic purse have anything to do with the move towards ITSO compliance and the recognition that Eceb's Multefile offers much better security than Philips more flimsy mifare?

Now to check when the other franchises are up for renewal.... ;0)

South Western stakeholder briefing
Ticketing Strategy
A change in ticketing technology is to be required in the Invitation to Tender both within London Zones 1-6 and outside.

Bidders will be required to price the introduction of ITSO-compliant ticketing throughout the franchise area from January 2009, with an expectation that ITSO compliant ticketing products will be available for use in London zones 1-6 from that date. Bidders will therefore need to provide an ITSO compliant ticketing system comprising ticketing issuing equipment, readers/validators and appropriate gating throughout the franchise, including within the London (zones 1-6) area, and any ITSO back-office functionality they require to enable use of the sophistication afforded by smart ticketing as appropriate. This will also require negotiations with other train operators through ATOC and with Rail Settlement Plan.

The franchise specification requires bidders to price acceptance of Oyster Pay as You Go products (as well as Travelcards, which are already accepted by London TOCs) in zones 1 to 6 once the Waterloo station gateline is complete and operational (hence from January 2009, or potentially earlier). This will require all SW stations within the London (zones 1-6) area to be fitted with equipment enabling Oyster acceptance, at gating levels deemed appropriate by the bidder, at the operator's expense. Bidders can retail Oyster tickets for use within London zones 1-6 at their own discretion.

The Department will work with TfL to modify the existing Oyster estate to accept ticketing products meeting the ITSO specification as well as existing Oyster ticketing products.

Crowding and capacity constraints on the South Western network can be controlled through various measures including demand management techniques and the provision of additional capacity. Incentives to travel in the shoulder peaks can be provided with more shoulder-peak seating capacity, and the ticketing technology can be used to flex prices throughout the day, including within the peak, to encourage a change to current travel behaviour.

It will be assumed that rail-only zonal fares within London Zones 1-6 will be introduced in due course as a pre-cursor to the introduction of Oyster pre-pay.

Bidders will be required to fit load weighing equipment to the rolling stock fleet used in the franchise to provide improved data on passenger demand levels."

[garth] 06/4/2006 08:10

Southwestern Trains to introduce ITSO. That means business for Ecebs :0)

Rail firm to use smart tickets

New South Western Trains franchise to introduce Oyster card-style tickets

Daniel Thomas, Computing 06 Apr 2006

Passengers on the new south-western train franchise will be the first outside London to use smartcard-based tickets, says the government.

The Department for Transport (DfT) says the successful bidder for the franchise – which is up for tender and includes the South West Trains and Isle of Wight's Island Line networks – will have to update ticket machines and electronic barriers throughout the region to handle the contactless cards.

Commuters will be issued with smart tickets containing fare details that can be updated electronically and charged online, and will reduce queueing for tickets at stations.

DfT expects to launch the scheme in 2009 and says the technology will be used to encourage commuters to travel to work at off-peak times of the day by discounting fares.

'During peak times it can get very busy and this might help incentivise what times people travel,' said a DFT spokeswoman. 'The technology could allow some clever discounting.'

It is also hoped that the scheme will reduce travel fraud and combat ticket theft.

The DfT has stipulated that the smartcard must comply with technical specifications set out by ITSO, an industry group campaigning for interoperable smartcard ticketing standards in public transport.

The new south-west operator will also have to equip train stations within the London travel zone boundaries with devices that can accept the capital's Oyster pre-pay smartcards.

Computing has also learnt that Transport for London (TfL) has delayed trials of its Oyster e-money project while it works with the financial services industry and the smartcard operating consortium Transys to define the scheme's requirements.

TfL had planned to appoint a technology partner for the e-money project by the end of last year and commence trials in late 2005 or early 2006 (Computing, 28 July 2005).

Oyster e-money will allow commuters to use the smartcard to pay for low-value goods and services at newsagents, fast-food outlets, supermarkets and parking machines.

A TfL spokesman told Computing work is still ongoing and no major announcements are due.

'Our main focus is on finding the right way forward rather than hitting the timescale announced last year,' he said.

[garth] 06/4/2006 07:53

Southwestern Trains to introduce ITSO. That means business for Ecebs :0)

Rail firm to use smart tickets

New South Western Trains franchise to introduce Oyster card-style tickets

Daniel Thomas, Computing 06 Apr 2006

Passengers on the new south-western train franchise will be the first outside London to use smartcard-based tickets, says the government.

The Department for Transport (DfT) says the successful bidder for the franchise – which is up for tender and includes the South West Trains and Isle of Wight's Island Line networks – will have to update ticket machines and electronic barriers throughout the region to handle the contactless cards.

Commuters will be issued with smart tickets containing fare details that can be updated electronically and charged online, and will reduce queueing for tickets at stations.

DfT expects to launch the scheme in 2009 and says the technology will be used to encourage commuters to travel to work at off-peak times of the day by discounting fares.

'During peak times it can get very busy and this might help incentivise what times people travel,' said a DFT spokeswoman. 'The technology could allow some clever discounting.'

It is also hoped that the scheme will reduce travel fraud and combat ticket theft.

The DfT has stipulated that the smartcard must comply with technical specifications set out by ITSO, an industry group campaigning for interoperable smartcard ticketing standards in public transport.

The new south-west operator will also have to equip train stations within the London travel zone boundaries with devices that can accept the capital's Oyster pre-pay smartcards.

Computing has also learnt that Transport for London (TfL) has delayed trials of its Oyster e-money project while it works with the financial services industry and the smartcard operating consortium Transys to define the scheme's requirements.

TfL had planned to appoint a technology partner for the e-money project by the end of last year and commence trials in late 2005 or early 2006 (Computing, 28 July 2005).

Oyster e-money will allow commuters to use the smartcard to pay for low-value goods and services at newsagents, fast-food outlets, supermarkets and parking machines.

A TfL spokesman told Computing work is still ongoing and no major announcements are due.

'Our main focus is on finding the right way forward rather than hitting the timescale announced last year,' he said.

[garth] 04/4/2006 13:38

Have to agree that with Multefile in ITSO it seems hard to see where there is any real downside in these.

G.

[rcktmn] 04/4/2006 13:12

G.
Nope..just gut feel!
Good sector to be in. New company floated at sensible level.. should go up from here. Liked the frequency of news release and contracts announced to date with more to come..good trading statement and making profits...very little downside overall.. :)

[garth] 04/4/2006 12:13

Interesting read on modern railways and the development of ITSO/ Oyster and the monopoly position of Cubic. Slightly out of date as ISAMs now available and in use.

We also know that through its FASTIS system Cubic now offers ITSO compatibility.

20SOURCES%20ARCHIVE/INF%20SRCS%202005/Informed%20Sources%2008%202005%20p2.htm

G.