New York Provincialism, and the MTA’s Flawed Smartcard Report

New York’s MTA recently published a report proposing a next-generation payment system replacing the MetroCard. You can find it here: to read it, download it and add .pdf to the file extension. Sections 4-5 are the most relevant here.

The report is full of little facts about New York such as the number of transactions on each component of the MTA, but never once mentions case studies abroad – Hong Kong’s Octopus, Tokyo’s Suica and PASMO, or the many European cities that are happy with paper tickets. It uses factoids to intimidate more than to explain. For example, it repeats the fact that New York City Transit spends 15% of its revenue on fare collection, but never breaks it down to parts, does cross-city comparisons, or even estimates how much a smartcard system will save; the only purpose of the number is therefore to scare people into doing something.

Despite advertising its intention to save money, the MTA makes no mention of bundling smartcards with proof-of-payment, widely used way to speed up bus boarding and reduce train staffing levels, even with plain paper tickets. On the contrary, the report specifically mentions equipping commuter rail conductors (and not fare inspectors) with card readers, and only mentions inspectors in relation to Select Bus Service and the Staten Island Railway.

Even on the level of checking existing technology use, the report falls short. The MTA rates smartcard options as “medium-low” on “inter-modal interoperability,” on the grounds that they require card validators and card readers. In reality, card validators are cheap: in Singapore, they cost about S$950 per unit (about US$770); placing one at every bus stop and commuter train station and on board every bus door and commuter train door pair would cost $20 million, less than a tenth the cost of a smartcard implementation.

Similarly, the report rates internal transit smartcards’ lifecycle risk as “medium: mature technology, though standards are not.” The closest thing to truth in there is that there are two open standards, Sony’s FeliCa and a separate standard whose top vendor is NXP’s MIFARE, and the ISO chose the standard used by MIFARE over FeliCa (FeliCa was already in place in Japan and Hong Kong, so it still has the most users). In reality, both FeliCa and MIFARE date to the mid-1990s, making them older than the smartphone and broadband Internet.

The report mentions a foreign city exactly once: it says that “The technology risk is mitigated by Transport for London’s adoption of open payments, planned for 2012, and its role in advising the MTA and potentially sharing technology.” Optimistically, it means the MTA listens to other cities when they say what it wants to hear. Pessimistically, both cities are using each other to justify a prior decision. MTA Chairman Jay Walder, the primary proponent within the MTA of the credit card-based smartcard, worked in London until 2007 and was responsible for introducing the Oyster card.

And speaking of London, Oyster is bumpy at best. It is superficially similar to Hong Kong’s Octopus, down to the similar name, but in practice it is much more primitive. Octopus is licensed as anonymous electronic money (in a culture that according to Western stereotype is authoritarian and indifferent to privacy), generating additional profits to the MTR; Oyster is not, and the MTA report makes no mention of this possibility. Octopus comes in more forms than just a card – for example, there is an Octopus watch and an Octopus keychain, making tapping easier since the rider does not need to take out their wallet; Oyster does not, and when riders took out the chip to create a makeshift Oyster watch, TfL fined them even though they were not dodging the fare.

The MTA keeps underperforming because it doesn’t listen to other cities’ experience, unless it’s what it wants to hear. And this is perhaps the worst abuse, because here the person who’s leading the charge for reform in New York has a track record of screwing up abroad. New York has spent decades convincing itself that it is the best city in the world and needs to learn from no other, taking pride in its subway. The result has been a metro area transit mode share lower than that of European cities one tenth New York’s size. Walder speaks like a reformer who tries to change this, but the one time he’s proposing something concrete, it’s the usual New York provincialism.


  1. Stephen Smith

    Two things:

    1. Do you think the reluctance to move to a proof-of-payment/inspector model has anything to do with unions? I guess the buses and subway don’t have this excuse since they’ve done it with SBS and the SI Railway, but commuter rail lines in the Northeast have different and often more draconian unions than the other modes, right?
    2. With regards to Singapore’s e-currency system, I’m not sure that America’s backwards financial laws could cope with that, and the UK might be similar. From what I understand, the US trails way behind Asia and Africa (!) in e-currency deregulation/implementation.

    Both of these things do indeed lead to inefficient and often proprietary implementations, but it seems that provincialism is in some cases the effect rather than the cause.

  2. Alon Levy

    1. I really doubt it’s about the unions. Walder is fairly hostile to the unions and vice versa, and has mentioned that smartcards would allow conductors to check trains faster, i.e. have fewer conductors per train.

    2. Singapore doesn’t use EZ-Link/Cashcard as electronic money much – only for things like vending machines and parking. The most expansive electronic money use of a smartcard is in Hong Kong, followed by Tokyo. I don’t know how possible it is for a public operator, though; the MTR expanded its electronic money function after privatization.

  3. BBnet3000

    Whether the current situation is caused by the old railroad culture or the unions, i suspect that when they try to change it th e unions may do their best to stop it.

    After riding BART for awhile, it amazes me that LIRR, etc still have conductors. I wonder how much that contributes to the cost difference between BART and LIRR. Im guessing that the fact that a huge portion of BARTs ridership is within SF/Oakland like a subway helps too.

    • Nathanael

      The LIRR is astoundingly obsolete in its operating practices. Did they ever stop employing “firemen”? I don’t think so.

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    • lake9856

      Why is Octupus bad? You don’t have to hand over your name, credit card information, or a bank account to get an octupus card, so how could it be used to surveil you? You can buy stuff at 7/11 with an octupus card, and use it across transit systems, but if people are concerned with their privacy they can just buy a cash octupus card and only use it for travel on public transit, right?

      How is it authoritarian or indifferent to privacy?

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