Octopus 2.0

The Apple Pay Octopus launch in June 2020 marked the end of an era of Octopus as the exclusive Hong Kong MTR home grown transit platform, and the start of MTR integrating into China mainland transit fare standards. In August 2020 Octopus Cards Limited announced they would join China T-Union. My take about it and the eventual migration of Octopus from FeliCa to PBOC 2.0, struck a raw nerve and did not go down well with some Hong Kong folk:

Can someone tell the ill-informed, self-centred, attention-seeking blogger to stop spreading fake rumours about octopus ditching FeliCa? Not in this lifetime…The self-proclaimed expert blogger’s been wrong on so many levels I’m amazed people still follow him like religion and never question his fantasy stories. Utterly annoyed by him dropping quotes from people out of context and use them to his benefits.

In April 2021 new OCL CEO Angus Lee Chun-ming said in a South China Morning Post interview that OCL had applied for China T-Union membership as planned, and will launch a dual mode Octopus card for mainland transit use:

“We have applied to join the China T-Union, the nationwide one-card payment system led by the Ministry of Transport. That will enable Octopus physical-card holders to pay for public transport fares in mainland China,”…

The service can be upgraded to digital Octopus cards in the phase two development. “The card will be denominated in Hong Kong dollars. Octopus will arrange the currency settlement with the mainland partner,” said Lee.

A one-card nationwide payment system eh? Sounds like an plug for China T-Union instead of an Octopus presser. Phase 1 is a physical dual mode Octopus card that appears to be 2 separate chips (PBOC and FeliCa) in one card with a common HKD ePurse. This is novel as Greater Bay Area dual mode cards up to now used separate ePurses for each currency. It’s also complicated because mainland transit operators have to do the currency conversion. A digital wallet version is phase 2. The elimination of FeliCa on the Hong Kong side will be the final phase, though that depends on the Ministry of Transport removing the current PBOC restriction that limits it to transit use and T-Union branding issue, or Octopus coming up with something else. We shall see.

On the mobile side Hong Kong iPhone users already have a dual mode Wallet option to add China T-Union cards if they have a China UnionPay credit or debit card. It’s not dual mode on one card and there is an Express Transit issue when turning on a China T-Union card turns off Express Transit for Octopus, but it works.

Dual mode transit cards on Apple Pay don’t exist yet but they are technically possible. Apple Pay already uses dual mode NFC switching for Japanese issue payment cards, FeliCa for contactless use in Japan, EMV for contactless use abroad. Another option might be the multiple secure element domain/multiple NFC protocol support of Mobile FeliCa 4.1 outlined by FeliCa Dude for dual mode transactions using just Mobile FeliCa with NFC-A/NFC-F.

On the transit gate side it will be interesting to see what design MTR uses for multiple protocol open-loop. NFC requires the reader side to specify the NFC protocol used for the transaction. This is a not a problem at store checkout, but how does the user specify the transaction protocol on transit gates? Answer: by tapping different readers. Perhaps the new MTR gates will host a NFC-A reader (EMV and PBOC), a NFC-F reader (FeliCa) in addition to the already separate QR reader? And if those Touchless UWB rumors are true, UWB and Bluetooth could be joining the MTR next generation gate party. One thing for sure, transitions are messy, and expensive.

Farewell FeliCa Octopus, save the last tap for me

During the 2019 Apple Pay Octopus saga one thing was clear: Octopus was living on borrowed time. On the eve of the Apple Pay Octopus launch:

Octopus Cards Limited (OCL) has been slow extending the service to include mobile. Instead of putting early effort into digital wallet support for Apple Pay/Google Pay/Samsung Pay, OCL wasted time and resources developing the niche Mobile SIM product which didn’t pan out. This lag coupled with the rise of AliPay and WeChat Pay QR Code payment empires put enormous pressure on OCL to do something…

With so much traffic and business from the mainland, OCL owner MTR is looking to add QR Code Open Loop transit support (paywalled link)…MTR gates will eventually look like the ones in Guangzhou with PBOC/FeliCa/QR Code readers supporting Octopus, China T-Union, AliPay/WeChat Pay. At which point I say OCL doesn’t have a viable transit platform business anymore.

I hoped the success of Apple Pay Octopus would buy it time, but on August 28 the South China Morning Post published a story where OCL CEO Sunny Cheung says they will join the China T-Union initiative for seamless transit integration between Hong Kong and China. He to goes out of his way a few times in the interview to say how ‘old’ NFC technology is:

Cheung said internet users’ criticism of Octopus being a tech laggard died down in June after people were allowed to add their Octopus account to Apple Wallet on their iPhones. Cheung, who admitted he was stung by the criticism, regarded Octopus’ breakthrough on the iPhone as one of the best times of his stint with the company. “This was one of my biggest challenges,” he said. “The breakthrough helped refresh Octopus’ image even though it is still using NFC technology.”

Hong Kong’s Octopus aims to spread tentacles with contactless card for paying fares in mainland China

Obviously Sunny thinks that QR Codes are cutting edge. He is retiring and doesn’t care about criticism of his disastrous OCL tenure, or scalping inbound tourists who want to use Apple Pay Octopus.

Hard Reality
China has ruthlessly weeded out MIFARE and FeliCa transit cards and replaced them with the slower PBOC 2.0/3.0 China T-Union standard, aka the supermarket checkout spec. Octopus will eventually get the same China T-Union lobotomy.

If OCL went deep instead of cheap Octopus would go ‘dual mode’: a single card with separate NFC protocols and currency purses: NFC-A/China T-Union RMB and NFC-F/Octopus HKD. In this scenario Hong Kong Octopus remains on FeliCa with the rest of China on PBOC China T-Union.

Unfortunately OCL will likely go cheap instead of deep…. a single protocol China T-Union PBOC 2.0/3.0 card that works everywhere, and on mobile, for all mainland transit and for mainlander transit in Hong Kong. There is also the plastic card issue business angle to consider. Read FeliCa Dude’s Octopus on iPhone 7 post paying special attention to the Octopus plastic card issue steps that he outlines. The Hong Kong powers that be would like that profitable franchise sourced locally or in mainland and not from Sony.

‘One country two systems’ was an illusion. Hong Kong is being force fitted into China, nothing is sacred, there are no hold outs. It may take a few years, but as MTR transit gates and OCL store readers are gradually replaced with newer models, those readers will all have dual mode FeliCa/PBOC support. And when everything is ready, MTR and OCL will simply turn off FeliCa. FeliCa based Octopus has had a great run that influenced transit fare system development around the world. Enjoy it while it lasts.

Octopus is Out of Time

Is this the last time? Just a few thoughts as iOS 13.5 closes in on what hopefully will be a late May delivery, also rumored to be the launch iOS for Apple Pay Octopus. Recent beta test feedback says the minimal system for using Apple Pay Octopus was raised from iOS 13.2 to iOS 13.4.5 (rebranded by Apple to iOS 13.5). Also a new Schedule of Fees and Guidelines is due May 20. The Hong Kong Economic Times eZone site has taken this to mean that both iOS 13.5 and Apple Pay Octopus will launch on the May 20 Octopus Fees and Guideline update day.

The enthusiasm is understandable, but a similar situation happened in December with no launch. In short, hope for the best but don’t get your hopes up. We’ve been down this road before, but time is running out. If Apple Pay Octopus doesn’t launch in the iOS 13.5 timeframe, it’s not launching at all.

There aren’t any technical reasons for the delay; after all the Smart Octopus mobile service on Samsung Pay has been operating since December 2017 with Mobile SIM service before that. I believe it’s a result of the pressure politics facing Hong Kong, pressures both economic and governmental.

Out of Time Octopus
Octopus was the world’s first transit platform business that extended the transit smartcard to include payments and many other services but Octopus Cards Limited (OCL) has been slow extending the service to include mobile. Instead of putting early effort into digital wallet support for Apple Pay/Google Pay/Samsung Pay, OCL wasted time and resources developing the niche Mobile SIM product which really didn’t pan out.

This lag coupled with the rise of AliPay and WeChat Pay QR Code payment empires put enormous pressure on OCL to do something comprehensively mobile which it did with the O! ePay service in early 2019. But it’s not the only pressure: with so much traffic and business from the mainland, OCL owner MTR is looking to add QR Code Open Loop transit support (paywalled link) at some point. There is also the pressure of creating a Greater Bay Area transit card, and pressure from credit cards and banks. Every player wants a piece of the action.

Perhaps MTR gates will eventually look like the ones in Guangzhou with PBOC/FeliCa/QR Code readers supporting Octopus, China T-Union, AliPay/WeChat Pay, perhaps even EMV contactless bank cards:

At which point I say OCL doesn’t have a viable transit platform business anymore. Mainland China dumped the MIFARE based Beijing and Shanghai card architecture for their own slower PBOC 2.3/3.0 China T-Union standard, I don’t think it’s a stretch to see the same thing happening to Hong Kong Octopus at some point.

Supporters will undoubtably point out the technical merits of China using a single transit standard but that’s just a red herring. Smart devices and digital wallets handle all protocols and will continue to incorporate new technologies. The deciding factors will be good old money and politics: is it more profitable to keep Octopus in place or junk it in favor of QR and China T-Union, and who benefits from it all?

Octopus is living on borrowed time. If it doesn’t aggressively expand services on digital wallet platforms, it doesn’t have a future. Apple Pay Suica turned things around for Suica, let’s hope the Apple Pay Octopus launch can do the same for Octopus.


Apple Pay Suica had a huge impact on Mobile Suica use
Modern digital wallets like Apple Pay seamlessly support multiple payment technology protocols

UPDATE: on May 18 at 4:30 PM, an Octopus system glitch temporarily showed an option to add Apple Pay Octopus cards to Wallet to some iOS Octopus app users, but the feature not functional on the Apple Pay Wallet end. The glitch was quickly fixed but this is a sign that a service launch is imminent post glitch rumors say June 2. (Edit: June 2 did turn out to be Apple Pay Octopus launch day)

The Octopus Waiting Game

UPDATE: Apple Pay Octopus launched June 2, latest details here

The release of Apple Pay China T-Union cards this week with the iOS 13.4.1 update was accompanied with a new Apple Pay China transit page that completely rebrands Apple Pay China as a transit experience. Considering the popularity of QR Code use in China and the slow speed of the China T-Union PBOC protocol, it makes sense for Apple to go all in promoting Express Transit: it’s the only real advantage Apple Pay has over QR Code AliPay and WeChat Pay.

The rollout was also accompanied by some Hong Kong anguish and mocking of the Apple Pay Octopus delay that has become a sad joke. Karen Chiu of SCMP drily noted that, “Apple Pay users in Hong Kong are out of luck,” and Octopus Cards Limited is just a big tease. Ouch!

Octopus Cards Limited made a joke but iPhone users are not laughing

There was sarcasm from others as well, best seen in the comments section of a trite lazy MacRumors piece Apple Pay’s Express Transit Feature Now Supported in 275 Chinese Cities that appears mostly lifted from an equally trite Benjamin Mayo 9to5 Mac post, both borrowing from the Karen Chiu piece without giving credit, so lazy that MacRumors used a MTA OMNY transit gate picture for a China transit story.

The comments are golden however and way more interesting than the story post. They illustrate not only frustration with the Apple Pay Octopus delay waiting game, but also note the seismic shift of Hong Kong in 2019:

Still no news for (Apple Pay Octopus) support in Hong Kong

>At least we know they are testing it. It has more to do with delays on stupid Map Transit

>Really can’t wait to use Octopus for Apple Pay Transit in Hong Kong! Its seriously taking them way too long to implement. This feature was rumored for so long and was already leaked before iOS 13 was released last year, yet we still do not have it.

>>They (Apple) are basically neglecting the HK market. Unacceptable to take so long

>>Hong Kong is so behind on this. Octopus Card company is flexing its monopoly power to the fullest extent. They work with Samsung in exclusive deals so Samsung users can use their phone to pay.

>>>Exactly. Totally unacceptable. At one point, I considered switching to Samsung just for this feature. (of course its impossible to climb over the high walls of the apple ecosystem garden, especially iCloud)

Hong Kong has delusions of grandeur because of its status as a place to buy Apple products for mainlanders when they weren’t so readily available on the mainland… as a market nowadays, it isn’t large at all. The focus is rightly on bigger markets.

>Bruh Hong Kong is jewel of the East, so it certainly deserves Apple’s focus on the market. And mainlanders can buy Apple products on the mainland, they are not welcomed in HK.

>>Perhaps in the past… If the various signs of HK fast losing its foothold isn’t obvious, I dunno what else is. Signs of big brands leaving HK, newer brands going direct to China and bypass HK, and months of protests+riots+bombing driving foreigners to rethink or left amidst COVID-19, etc…..

>>Shall see if HK is still relevant after the global COVID-19 is more or less over and as we march straight into a global recession.

Apple Pay’s Express Transit Feature Now Supported in 275 Chinese Cities

Is there any good new out there? The latest rumors now say Apple Pay Octopus will launch in May on iOS 13.4.5 iOS 13.5 that may, or may not be, the iOS release for the rumored iPhone SE (edit: iPhone SE went on sale with iOS 13.4).

The waiting game continues.


Apple Pay Octopus Waiting Game Timeline