Green perspectives on Stockwood and Bristol. Mostly.

Friday, 5 November 2010

Why Smart Cards aren't so smart for First Bus

[Over on 'Turning Bristol Red', Darren Lewis takes a well justified pop at the problems of travelling by bus in Bristol. Here's a bit more, to explore how First Bus's corporate priorities actually prevent progress.]

On the face of it, 'smart' oyster-style tickets have a lot to offer bus operators. They free up drivers from the fare collecting duty, save costly, non-profitable time at bus stops, make the service faster and more attractive to passengers. All good for business, good for profits. But instead of going for it, FirstBus are keeping well away from Bristol's efforts to introduce smart travel cards.

Could it be to protect their monopoly?

In Bristol, it was the First group that held the dominant position after the post-deregulation bus wars, and they've protected that monopoly ever since.

Near-monopoly, of course, brings economies of size and (in theory) greater efficiency. That was one of the great assets of publicly owned transport networks; full access to the more profitable routes allowed cross-subsidy for the less economic routes. First, though, don't have to do that - they can (and do) abandon unprofitable routes at will, leaving local councils with the obligation to provide a subsidy to keep those buses running.

FirstBus has two more vital trade advantages that help maintain their monopoly, and thus their profits, while removing the need to actually improve services.

One (believe it or not) is customer loyalty! There's persuasive anecdotal evidence of customers waiting for First's more familiar and long-established buses, with a history on that route, rather than use one of the upstarts like U-Link or ABus, notwithstanding the time and fare advantages they might offer.

The second, crucially, is their First Day ticket; £4 each and travel anywhere in Bristol for the day - so long as it's on their buses. Take the family (off peak) and it's a mere £7.50. But of course, if you want to do one leg of the trip on someone else' bus, you'll have to pay that fare on top.

No other operator in Bristol can compete with that offer - and First know it.

In London, the Oyster card seems to set the standard for smart cards on local public transport. It does what a First Day ticket doesn't do - it takes you on London buses, tubes, trams, and even on heavy rail. Who runs the service doesn't matter. If, at the end of the day, you've 'spent' more in fares than a daily cap (if you'd used a Travelcard instead), you pay the lesser fare.

In Bristol, such a scheme would threaten First's monopoly, because they could no longer rely on selling cheaper 'First-only' tickets that keep passengers from using rival services.

First Bus get deeply involved in forward planning for such things as bendy bus routes, where they think there's something in it for them. But they're nowhere to be seen when smart cards are mentioned. So what progress has Bristol managed without the active support of its main bus operator? As you might expect, very little.

Any good scheme has to be ITSO compliant, ITSO being the national standard for smart travel cards. Apart from a 'back-office system' that's being set up to manage it, there's little progress in Bristol to turn it into reality. Instead of helping push it forward, First are looking the other way.

Meanwhile a couple of minor (but more progressive) operators - U-Link and Wessex - are trialling a simpler short term substitute, a 'stored value' card that offers quicker boarding and fare reductions, but isn't ITSO compliant. That's all.

In short, First's priorities are self-interest and non-cooperation with anything that might undermine the market distortions that it has cultivated to protect its monopoly. And that stalls progress towards the smart travel card that Bristol desperately needs

[ADDED] There'a an e-petition on the city council web site calling for Oyster-style smart cards for Bristol


turningbristolred said...

Cheers for the mention!

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KB said...

Stockwood Pete, I think your comments are a little unfair and show a lack of understanding about how the process of getting smartcards in Bristol actually works. The smaller operators - who have the kit already - have had the kit bought for them by the Council. The same is not true for the larger operator First. Now there is an arguement that a bigger company perhaps needs less help, but the costs involved in changing all the ticket machines (which already work well) is huge and must be planned in over time. Needless to say, First does want Smartcard Technology and it is working with South West Smart Applications Ltd (a mutual not-for-profit company established by bus companies and local authorities in the region) to help speed the process.

Stockwood Pete said...

Thanks for the comment, KB.

My understanding is that First are coming very late to the ball - unlike the other big bus combines, which have seen the advantages that smart cards will bring, and are now well ahead. It has to do with different management styles and expectations; First are much more cautious and risk-averse.

My own take on it, given the situation in Bristol, is that First have an excellent product in the First Day ticket, they have the near-monopoly market share that allows it to succeed, so why risk both by co-operating with other companies in a smart card scheme that would elevate other companies to equal partnership?

Whatever their reason for hanging back, they must think it outweighs the advantages they'd gain with smart cards. The dwell time (that's boarding, ticket purchase, and dismounting)at stops can be as much as 25% of journey time even in congested Bristol, so speeding up the process and freeing the driver from dealing with cash could make the bus far more productive. Yet First remain unco-operative - hence my speculation about their reasons.

I can't believe a plea that they've got a lot of buses, so it would cost a lot. The costs would be per bus, same as for every operator, and would bring benefits per bus. Would bring in more passengers too.