The Suica 2.0 launch in the Tohoku region on May 27 is not simply a launch. It marks the transition to a whole new business model for JR East. The future is Suica as a mobile payment and services platform that leverages JR East transit infrastructure. It has to be because the traditional business model of selling train tickets is declining along with the population of Japan. Fewer people, fewer trains. Lifestyles and work styles are changing too, as expected, but COVID has drastically accelerated societal shifts that planners expected to happen gradually such as doing away with work day commuting and the need for commuter passes.
And there is mobile. The ability of doing things with an app and a credit card instead of having to go to the station ticket office or kiosk has made a lot of station infrastructure irrelevant. Station infrastructure and ticketing systems built for the era of cash based kiosks for paper tickets, commuter passes is redundant in the Mobile Suica era, and maintaining local JR Green Window Ticket Offices in every station is expensive.
For example, long time JR East commuters have witnessed the gradual elimination of paper ticket kiosks in favor of pink Suica recharge kiosks. This is because over 90% of JR East Tokyo area transit users use Suica or PASMO and the reason why there are fewer expensive maintenance heavy IC + paper ticket gates and more inexpensive easy maintenance IC only gates at stations. Are there are more IC Card only exits in rebuilt stations especially with connecting shopping malls.
Green Window Ticket Offices are disappearing at a rapid pace too, 70% will be gone by 2025, replaced by Eki-Net online ticketing services and Mobile Suica commuter passes. As YouTuber kenzy201 says, once you migrate to Mobile Suica, you can never go back to plastic. As for those recharge kiosks, private rail operators are removing them and renting out station space to 7-11 ATMs that do the same job, as kenze explains in his video that covers reducing cash oriented station infrastructure.
Open Loop Reality
All of this is taking place while multiple transit companies are testing open loop transit for deployment as a way to increase revenue. One of the issues that people don’t discuss about open loop transit is the lack of integration on a large scale like closed loop Suica. Open Loop doesn’t travel well. When you examine the deployments around the world, it is limited to isolated systems with simple fare structures. That’s why I call the Japanese test installations transit boutiques. It doesn’t integrate well across complex fare structures and multiple transit connected companies. It doesn’t work for reserve seat Shinkansen and express train eTicketing. Complex transit ticket packaging and fare validation speed is where closed loop shines. In real world testing open loop isn’t an improvement over Transit IC. The mix and match transit gate environment, predictably, slows things down. Open Loop has its place in the transit mix, but I believe the return on investment will not live up to expectations.
Integration is the key
The promise of Suica 2.0 boils down to creating a whole new level of integration. The current Transit IC standard is a strong one because it integrates cards across different transit regions with cross compatible eMoney purchasing. The integration of mobile with Suica took it to a whole new level as the world’s first transit payment platform, as did Apple Pay integration in 2016. By moving fare processing to the cloud, Suica 2.0 will integrate isolated Suica regions, integrate new flexible fares and new types of commuter passes while promoting local services in new ways. It will eventually incorporate QR ticketing as well. As cloud based transit IC systems are linked together, the integration will spread beyond JR East. Integration is the only way forward for the Transit IC platforms, Suica, PASMO and ICOCA, to evolve and survive and grow in the mobile era. It’s going to be a very interesting journey.
Related: Final Frontiers: How Suica 2.0 will solve the IC fare barrier problem and much more
Launch Gallery
You must be logged in to post a comment.