Title: Smart cards in public transportation: spatial platforms, diffusion and externality creation

Authors: Tuomo Kinnunen; Pekka Kess; Jukka Majava

Addresses: Industrial Engineering and Management, University of Oulu, P.O. Box 4610, Oulu, FI-90014, Finland ' Industrial Engineering and Management, University of Oulu, P.O. Box 4610, Oulu, FI-90014, Finland ' Industrial Engineering and Management, University of Oulu, P.O. Box 4610, Oulu, FI-90014, Finland

Abstract: This original research evaluates contactless smart card technology as a source of innovation in public transportation. Ticketing and fare collection are in global transition from cash, paper tickets and contact cards to contactless payment. The global diffusion of contactless smart cards has progressed slowly by the local diffusions of separate platforms following the 1997 launch of Octopus platform in Hong Kong as the first successful large-scale implementation. This research utilises the principles of a multiple case study and a multi-sided platform as a theoretical frame to analyse four well-diffused platforms: Octopus, Oyster, EasyCard and OV-chipkaart. The results show that common strategies are shared for the design and expansion of multi-sided platforms in public transportation while strategies toward other sectors differ. Although limited to four cases, from a managerial perspective, this paper demonstrates that the utilisation of original technology platforms is more dependent on institutional and societal factors than technological frame.

Keywords: diffusion; e-payment; electronic payment; innovation; intermediary platforms; operations management; public transport; smart cards; contactless cards; contactless payment; technology platforms; institutional factors; societal factors; ticketing; fare collection.

DOI: 10.1504/IJMOM.2016.081341

International Journal of Modelling in Operations Management, 2016 Vol.6 No.1/2, pp.47 - 58

Received: 03 Jul 2015
Accepted: 13 Apr 2016
Published online: 05 Jan 2017 *

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