Jilted Snapper vies for Auckland's affections, seeks to recover up to $20m
Snapper is on a PR offensive against Auckland Council, using a highly orchestrated product launch today to take a swipe at the council's transport arm.
Auckland Transport gave Snapper the flick from its integrated ticketing project last month in favour of French company Thales, saying it was going to miss its November deadline.
Thales was originally awarded the contract in December 2009 but Snapper – owned by NZX-listed Infratil – had already gone ahead with its own system.
That meant there were effectively two separate systems which needed to be compatible with each other.
Auckland Transport says Snapper did not meet its compatibility obligations.
The Wellington-based company's CEO, Miki Szikszai, has been curiously absent from the media since the news broke that Snapper would be dumped.
At the time, he would not respond to requests by NBR ONLINE for an interview, instead passing on a statement from Snapper chairwoman Rhoda Phillippo.
However, he was present at today's lavishly-catered product launch at upmarket Kermadec seafood restaurant for a new mobile payment system, albeit flanked by Ms Phillippo and spin doctor Alison Horwood, an ex-New Zealand Herald reporter.
When asked if Snapper was pursuing legal action against Auckland Transport, Mr Szikszai would only say: "We're seeking the recovery of our costs." [UPDATE: Infratil later reported to the NZX comments by Mr Szikszai that the company would seek to recover between $10 million and $20 million].
This is the exact line which was given on a pre-prepared list of questions and answers about the ticketing issue given to journalists when they walked into today's product launch.
An obvious attempt to quell reporters' curiousity without actually having to answer questions, the list included questions such as: Why has Auckland Transport (AT) removed Snapper?
The answer: That's a question for AT.
It went on to reject Auckland Transport's claim that Snapper would miss the deadline, saying: That's not true. Snapper has delivered at every stage in the project so far.
While the media was given the chance to interview Mr Szikszai, his answers mainly echoed what was already written on the pre-prepared sheet.
Snapper may be trying to find favour with Auckland ratepayers – who are already footing a massive bill for the ticketing mess – hoping that would help its chances of recovering costs from Auckland Council.
New mobile payments system
The real purpose of today's event was to launch a mobile payments system, called Touch2Pay, into the Auckland market.
Mr Szikszai says there are already 300 retailers in Auckland on board and Snapper hopes it has made its technology simple enough to take it mainstream.
It has partnered with 2degrees and Australian company AB Note to develop the system, through which customers can wave their smartphone near a device at the point of sale to pay, eliminating the need to swipe an EFTPOS card.
Users can pre-load money on to their account, which the phone accesses via the phone's sim card.
The uptake, however, is limited by how many retailers choose to install Snapper equipment in their stores.
With just 300 retailers using the system now, there is seemingly little incentive for consumers to try it.
Also, the number of smartphones on the market supporting mobile payment technology – or Near Field Communication (NFC) – is relatively small.
Even the new iPhone 5, which is released on September 28, will not support NFC.
Snapper also does not know whether its technology will be compatible with the system its French rival Thales will be installing on Auckland's trains and buses.
However, Mr Szikszai says once the details of Thales' system is known Snapper can try to make its technology compatible with it.
callison@nbr.co.nz
Back to home
Back to top
Print
Latest
NBR SERVICES
SUBSCRIPTIONS
Sign up for NBR subscriber content or email alerts
Comments and questions20
I wonder how much this will cost Retailers. I would have thought they would be better of getting Mastercard paypass and whatever Visa's equipment is rather than buying Snapper equipment.
I dont want another card in my wallet if possible.
Or are stores going to get an eftpos machine, Snapper machine, Mastercard payPass machine, and a Visa payWave machine.
Looks like we need another global standard.
And for those without a credit card, you can get payPass (or payWave) on a debit card as well - I used it on my AirNZ Onesmart card overseas last week.
That's exactly what will happen.. I've seen it in Wellington! I feel sorry for retailers!
@Harvey
We are integrating with existing EFTPOS terminals. Right now a retailer can get a single terminal & reader configuration that supports
- Snapper
- EFTPOS
- Credit card (mag stripe, contact and contactless)
- epay (for prepaid phone vouchers)
It makes a lot of sense for retailers to have one device that meets all of their needs.
The transition will take a little time as retailers will adopt this single solution as their existing terminal leases come up for renewal.
We're able to ride that wave as Snapper has built on the global standards for smart cards and payment terminals. We want to take that a step further and ensure there is a global standard for mobile payments also. We are willing to share the IP we've created so we can get there faster.
Miki
CEO
Snapper
With retailers in Wellington removing snapper terminals because of poor useage (and a large group of users who have to use snapper for NZ bus services), it does not bode well for Auckland (and Snapper). Nice idea but no direct online top up does not help the situation to start with.
@ Caleb - The number of NFC supporting smartphones is increasing rapidly... The Samsung Galaxy SIII has NFC and is a very popular phone.
It's interesting that you used the iPhone 5 as a benchmark, when the iPhone for the last two or three models (from 5->4/4s) have been behind the competition on specs and features.
Surely the benchmark should be the product of the #1 global smartphone manufacturer - Samsung. The consumers have spoken.
Come on; NFC capability just doesn't exist in the mobile phone market in New Zealand, and it probably never will! We don't get the number of devices many other countries do
Yes it does. 2degrees have NFC capable phones and SIMs available - http://www.2degreesmobile.co.nz/touch2pay
This comment is absolute rubbish. WP8 also supports NFC, so in the next six months. Samsung, Nokia, HTC will be releasing lots of NFC-enabled phones. the Appleoholics will just have to wean themselves off the fruit [inadvertant Bible quote!]
It seems to me that Snapper or Touch2pay is a bit ahead of its ability to design and meet manufacturing deadlines.
You would have thought they would have learned with the Auckland bus Fiasco.
Still no idea what which transport card is the right one to have. Or both? Communication fail.
If you use NZBus, then you will need both if you want to use other services as well. Eventually you will only need one (the AT HOP) so as a shopkeeper, I wouldn't be investing in snapper equipment .
Harvey
The Snapper retail equipment is a simple extension of a common garden variety EFTPOS terminal. In some cases, with the SmartPay terminals in around 3000 taxis nationwide, it is built into the terminal. The investment is between $0 and $3 per week on an incremental basis. We'll see that reduce further as other forms of contactless payment rollout.
Miki
CEO
Snapper
NBR - What do you have to do to get a verified username ?
That is just laughable. Who are they kidding?
The question we should be asking is why did NZTA and AT go with an encrypted Thales system and then expect Snapper to break it in order to make their system compatible?
Nearly every Android Smartphone launching in NZ next year will have NFC bar perhaps the most entry level $149 and below handsets.
2degrees already has 5 compatible handsets:
http://www.2degreesmobile.co.nz/touch2pay/smartphones
Snapper works really well in Wellington and up till Auckland transport used Thales it also worked in Auckland too.
Once again a New Zealand business is shafted by a shifty multinational buying local business
No, Snapper works on NZ bus in Wellington because they have installed it on their sister company's run. Snapper maybe be kiwi owned but the tech sure as is not. Check who owns T money and where the transactions are processed each night - hint it is not in the snapper data centre.
@ #17 that is so not the point. Some dodgy dealings have clearly happened between thales and Auckland.... and as per usual a kiwi business loses. It doesn't matter where the tech is sourced from.
@Anonymous
You are right. Snapper has partnered with T-Money who provide the same backend platform that services the city of Seoul. We have access to scale economics that are an order of magnitude better than can be accessed by building a system here. As a result the cost of processing is significantly less and we pass that onto our customers.
Partnering with large international scale players is how we do what we do. That also includes ABNote who manufacture Snapper cards - incidentally ABNote produce almost every single bankcard in NZ so we are in good company.
For those worrying about sovereignty of data and the actual finances, all data is mastered here in NZ and the float is controlled and managed on-shore.
We develop technology extensively here in NZ which includes application development, integration into other ticketing systems, EFTPOS, taxis, building security systems and, of course, mobile. It's an incredibly capable team that do great work.
Miki
CEO
Snapper