ERG Group designed and implemented a smart card fare collection system in Hong Kong that remains the largest of its kind operating anywhere in the world today processing over 7.5 million transactions each day.

The contract was awarded by Creative Star Limited (now called Octopus Cards Ltd) in 1994. The system known as "Octopus" was launched in 1997 with the issuing of the first 250,000 cards. The number of cards in circulation has grown to 8.8 million. And when you consider that Hong Kong has a population of approximately 6.9 million you begin to appreciate how much the system has become part of every day life. Passengers can travel on ferry, bus, light rail, heavy rail and underground services, provided by over 160 service operators, using their Octopus Hong Kongcard.

Octopus cards are recognised by readers within half a second – the cards need not even be removed from a person's wallet or purse. And with 11 million public transport rides each day the speed with which passengers can travel through the Octopus System is critical to the system's success. To celebrate the millennium, watches with the same transit functions as a smart card were produced illustrating the system's versatility.

Traditional ticketing systems involve significant volumes of coins which require floats to be maintained anywhere tickets can be purchased. Prior to the introduction of the Octopus system 60 tonnes of coins were collected on a daily basis. The cost of collecting and counting this volume of coins was as high as 0.8% of revenue. Delays of as much as three days would be experienced before each day's takings were counted and deposited into the operator's account. Under the Octopus System each day's takings are reconciled by 9:00am the following day. All operators' computer networks are linked to the Octopus Cards Ltd Clearing House that apportions revenues to the operators and deposits funds into appropriate bank accounts daily. Currently the daily turnover is around HK$50 million.

Octopus Cards Ltd has successfully introduced Octopus onto public light buses. In addition to public transport ticketing the Octopus card is also accepted at Maxims Fast Foods, Wilson Parking, public leisure facilities, over 3,000 vending machines, photo booths, public telephones and in Aberdeen Maxicabs and parking meters. Loyalty programs are also offered to cardholders using software locally developed by ERG.

Money can be loaded on cards at add value machines, as well as at 7-Eleven convenience stores where cards can also be used to make purchases.

Some cardholders have elected to personalise their cards with a photograph and are thereby able to subscribe to a service which automatically transfers HK$250 from their bank account or credit card account to their card when the balance reaches zero. If lost, personalised cards offer added security enabling cards to be blacklisted and any remaining balance transferred to a new card.

Mass Transit Railway (MTR) Corporation, Kowloon-Canton Railway Corporation and Kowloon Motor Bus staff use a personalised Octopus card as a staff card. Access to "staff only" areas are now controlled and logged using the Octopus card which has enhanced security and significantly reduced the need for conventional keys. Over 3,000 Corporation system and privately owned building entrances are protected in this way.

In 2000, ERG was awarded a contract to supply and install a smart card ticketing system for the five new stations on the MTRC's Tseung Kwan O line. This contract was completed 3 months early and the railway opened 4 months ahead of schedule. ERG's success in Hong Kong continued in 2001 when it was awarded a contract to extend the Octopus System to the Kowloon-Canton Railway Corporation's light rail transit network extension of eleven new stops. The extension also interchanges with the West Rail line. Most recently, MTR Corporation exercised an option to supply and install one more station at Nam Cheong.

Hong Kong

ERG also supports all the 7,200 franchised buses in Hong Kong with workshop maintenance of Octopus equipment.

As the largest fully integrated smart card ticketing system operating in the world today, the Octopus System regularly attracts transportation organisations from around the world.

In 1998, ERG won the international Sesames Best Smart Card Application Award for its design of the Hong Kong system and in 2000 the Group won the 2000 Business Asia Award for the Best Use of Australian Technology in Asia.

System Overview
The system solution was developed and implemented in order to deliver the world's largest integrated contactless fare collection system. The system for Hong Kong can be logically considered to operate in five interconnected layers:

  • Layer 1:     The Central Computer.
  • Layer 2:     Service Providers Central Computer.
  • Layer 3:     Local Data Processors including depot computers and station computers.
  • Layer 4:     Smart card Processing Equipment (Devices).
  • Layer 5:     Smart card and Reader.

Equipment Summary
ERG also performs maintenance services for the installed system in Hong Kong. All hardware and software is maintained.

The following table provides a summary of the equipment installed by ERG.

Name Description Quantity
CCHS Central system 1
Service Provider Central Computers Consolidation and management reporting at a Service Providers level. 6
Local Data Processor Local monitoring and data processing (station computers and depot computers). 90
Add Value Machine (AVM1000) Seven different types, including front and rear door models in addition to cash-only and cash + EFT. 271
Multiple Contactless Smartcard Processor (MPR1000 and others) Eight different types, including three pole mount variants, free-standing enquiry, flush-mount enquiry, wall-mount first class, Photobooth, and Lo Wu Quota. 1,288
Gate Adaption Kit (GAK) Six different types, including single/reversible for MTRC Cubic, MTRC CGA, and KCRC Cubic. 1,615
Universal Gate Adaption Kit (UGAK) Two different types, including single and reversible for Thorn Transit Systems International Gates. 390
Bus Equipment (CP4000, DC4000) Three different types, including the CP4000, DC4000 and wireless local area network. 4,000
Portable CSC Analyser (P4000) This included the P4000 and cradle for charging and communications to the local data processor. 247
Smart cards Manufactured by Sony Over 8m