Second Ave. Sagas

Category: OMNY

  • OMNY set to usher in the age of fare-capping in NYC

    The OMNY card will replace the Metrocard, though the fewer people who have one, the better. (Via the MTA)

    During the pandemic, the way I’ve paid for transit trips in New York City has undergone a seismic change. I haven’t used a Metrocard since the second half of 2020 when the MTA completed the OMNY rollout in the subway and on buses near me in Brooklyn. I don’t suffer the frustration of “please swipe again” and instead tap in on every ride using my phone. Since I’m not commuting regularly, I no longer need a monthly Metrocard, and since I’m paying for each ride individually, I’m happy to use the latest and greatest in payment technology to tap in on every ride.

    At some point — maybe in January when I head back to my office a few days a week — this might change, and I’ll have to revert back to Metrocards of yore. If I’m taking enough transit rides, I’ll have to think about whether an unlimited card makes sense. I’ll have to map out my planned trips to see if I’m going to make it back to 12 rides per week or 47 riders per month, the current breakeven points for a 7- or 30-day card respectively.

    But what if I didn’t have to think about it? Enter OMNY and enter fare capping.

    In our age of instant tech gratification, the MTA’s OMNY rollout has seemed almost glacial. The new fare payment system, in the works for the better part of a decade, was officially announced in 2017 and rollout began in 2019, around the time I interviewed Al Putre for a podcast episode on OMNY. It will still be another 20 months before the Metrocard makes its final swipe in July of 2023, and yet, by MTA standards, this project is zooming along. All subways and buses are now OMNY-equipped, and as the MTA records 25% of fares paid via the new contactless tap system, the proprietary OMNY card made its debut last month for those who don’t have or don’t want to use their own payment cards. But that’s only the beginning, and the MTA is finally starting to talk about one of the biggest benefits of OMNY: the potential to implement fare-capping.

    “For the MTA,” Janno Lieber, the agency’s current acting chair and CEO, said following last month’s board meeting, “the technology behind OMNY gives us ways to imagine fare structures in ways we haven’t really thought of just yet. This is a big, big moment. Folks recall that when we changed from tokens to Metrocard, that changed everything, not just how we collected fares but it give life to the monthly and unlimited fares that ended up being a financial plus in the long run. OMNY offers us the same opportunity to rethink fares.” This will, Lieber subsequently confirmed, include fare-capping.

    For the uninitiated, the concept of fare-capping is a simple one. If you take a certain number of paid rides in a given time period, once you reach the cap, every subsequent ride is free. Basically, if you hit the pay-per-ride cost equivalent of a time-based pass, you no longer get charged for additional trips during that time period. The Tube in London has implemented a daily cap reached on a rider’s fourth ride and weekly caps (which run from Monday to Sunday) generally reached on the 16th ride.

    Fare-capping is intended to take the guesswork out of buying a transit pass but more importantly, it opens up transit and time-based passes for those who may not be able to afford an initial outlay of $127 each month for that 30-day card. (Transit Center has written more on how fare-capping promotes transit equity and use.) Lieber spoke with NBC New York about these benefits. “If you ride a certain number of rides, at some point the algorithm will tell you the best deal for you is to have an unlimited,” he said. “[OMNY] will give you the benefit of that.”

    Fare-capping has always been one of the promises of OMNY, and in a Tweet a few weeks ago, NYC Transit let slip the future potential. Since then, politicians and advocates have come out in favor of the move. The Permanent Citizens Advisory Committee to the MTA spoke glowingly in a statement and urged the board to move fast: “Pairing OMNY with fare capping is the perfect match: it’s a marriage between technology and equitable fare policy. It will encourage people to get back onboard, and the more they ride, the sooner they’ll do it for free. Giving all riders the opportunity to, in essence, get a monthly or weekly transit pass without having to upfront costs will level the playing field and allow people of every income ability to take advantage of the benefits of unlimited access to the subways and buses.”

    In the State Senate, Andrew Gounardes isn’t waiting around for the MTA to act on its own. He recently introduced a bill mandating that OMNY include a fare capping system, garnering praise from transit advocates. “It’s an unfortunate truth that while commuters who can afford to pay $127 a month upfront are rewarded with unlimited rides, lower-income transit riders who can’t front the cash often end up paying for more expensive single-fare rides each month,” Jaqi Cohen of Tri-State Transportation Campaign said. “Fare capping would ensure that all riders have access to the same unlimited fare option, whether they could afford to pay upfront or not.”

    Of course this doesn’t mean fare-capping is coming to NYC tomorrow or next month, but the promise is there. The MTA Board is going to work with Transit staffers to understand how the system could be implemented and come up with a proposal that works for the agency and its bottom line and the riders. The questions to be answered include assessments of the time period, whether rolling or fixed to the calendar, and the dollar value of the cap.

    “Anything we do,” Lieber said, “involves reprogramming all those vending machines in the stations and working on the software and all of that, and we have not made a final decision exactly how this will work. And the board gets to decide. I don’t want to create expectations. We’re still studying this. We’re going to have to figure it out.”

  • Second Ave. Sagas Podcast, Episode 5: OMNY with the MTA’s Al Putre

    This is the dawning of the age of OMNY and the end of the line for the MetroCard. As the MTA brings its new open-loop contactless tap-and-go fare payment system online, New Yorkers have seen readers pop up throughout the city, but most riders still have more questions than answers about this mysterious new system replacing the MetroCard.

    I wrote up an overview of OMNY when I covered the launch at the end of May, and for this episode of the Second Ave. Sagas podcast, we’re talking all things OMNY. Joining me for the conversation is the MTA’s own Al Putre. He is the executive director of the New Fare Payment Program and has been in charge of revenue collection at New York City Transit for decades. In this week’s podcast, Putre and I talk all about OMNY — what it is, what it can do, when we’ll get unlimited ride cards and what the privacy concerns may be — as I ask your questions. Give it a listen.

    You can learn even more about OMNY on the system’s official site, and you can catch my conversation with Putre via the player below at all the popular podcast spots — iTunes, Google Play, Spotify, Pocket Casts and your favorite app. If you like what you hear and have been enjoying the podcasts, please consider leaving a review on your iTunes.

    As always, thank you for listening and thanks as well to Joe Jakubowski for sound engineering. I’ve been enjoying producing these podcasts but they take a lot of time and effort. I can keep doing them only through the generous contributions of my listeners so please consider joining the Second Ave. Sagas Patreon. Since this site runs entirely on Patreon contributions, I can keep it going only with your help.

  • With OMNY launch, the end of the MetroCard almost finally arrives

    With a sealed token slot, a MetroCard swiper and an OMNY reader, our Frankenstein turnstiles showcase the last three generations of subway fare payment technology. (Photo by Benjamin Kabak. See more on Instagram.)

    It’s hard to believe the MetroCard is only 26 years old. It seems as though the MTA has been talking about replacing the now-iconic blue and gold cards for nearly half its life, but that’s what happens when plans for a fare payment system based on a magnetic strip first proposed in 1983 take a decade to become a reality. By the time everyone is using the thing, it’s already outdated.

    Now, though, the end is truly near, and the MetroCard’s killer, a tap-and-go system called OMNY and developed by Cubic based off of London’s current contactless fare payment technology, officially launched on Friday. “The Metrocard has served New York well for the last 25 years but its time has come,” MTA CEO and Chairman Pat Foye said during Friday’s press conference.

    The path to get to a tap-and-go system for New York City was a bit of a torturous one, and the city has yet again seen its global competitors pass it by. London, for instance, adopted its own proprietary tap-and-go card in 2003 and has been accepting contactless cards on the Underground since late 2014. New York City, meanwhile, rolled out the MetroCard when magnetic strips were nearly obsolete and spent much of the last two decades spinnings its wheel. A brief contactless pilot around 2006 went nowhere as American payment card market wasn’t in line with the MTA’s needs, and a concerted effort to replace the Metrocard by 2012 floundered spectacularly amidst a bureaucratic morass. The Cubic solution came into view in mid-2016 but not until after a short delay in the project due to political in-fighting over the MTA’s capital plan. It’s never easy in New York City.

    But on Friday, New Yorkers could finally tap and go. The new system — branded as One Metro New York since it will be used throughout the region — launched with a 16-station pilot on all stations along the Lexington Ave. line between Grand Central and Atlantic Ave. and on all Staten Island buses. For now, and as the system rolls out citywide over the next 18 months, only those riders paying full fare will be able to use the contactless option as OMNY won’t be ready for time-based cards — 7- or 30-day unlimiteds — until 2021 at the earliest.

    Still, even though over 50% of riders can’t use their preferred travel passes on the system, MTA officials were excited about the debut. “We’ve spent years designing, developing and testing OMNY and we’re going to spend the next several months with the help of all New Yorkers to ensure all systems are working as we designed them,” Foye said.

    OMNY doesn’t come cheap. Cubic’s contract includes a budget of nearly $650 million as workers need to outfit every turnstile and bus in the city with the new technology and develop and build new fare payment card machines. But the MTA expects to earn back this expense by significantly lowering the amount of money is spends on fare collection. With higher maintenance costs and a technology wearing down, even with the steep cost, the MTA believed it had to upgrade. “We really didn’t have a choice but to replace the Metrocard,” Foye said.

    Under the OMNY rollout schedule, all buses and subways will have readers by the end of 2020, but the MetroCard will live on until 2023. (Click to enlarge)

    Despite the hoopla surrounding Friday’s launch, New Yorkers still have a lot of questions about OMNY, and it’s clear in the responses I’ve received that people still aren’t quite sure what is happening and what the new fare payment system will be. I’ll try to explain. OMNY is a contactless, open loop payment system that will fully replace the closed-loop MetroCard. This means riders can pay with a variety of options including contactless-enabled debit and credit cards, Apple Pay on their iPhones (or an Apple Watch), Google Pay or any similar system or, when the rollout is complete, riders who are unbanked, don’t have credit or debit cards or wish to pay with cash, will be able to purchase an OMNY card, as they do now.

    “At every phase of this,” Foye explained, “New Yorkers will be able to use Metrocards (or OMNY cards) or cash. People who do not have bank accounts or credit cards are going to continue as they can today use cash to buy a MetroCard or ultimately an OMNY card.”

    For those of us who use time-based monthly or weekly cards, the MTA will at first establish an account-based system via OMNY where riders can purchase time. I’d imagine WageWorks will rely on a similar system too, but the pre-tax benefits system hasn’t yet determined how its offerings will work with the new system.

    The MTA will eventually offer a proprietary OMNY card for those who want to pay in cash or do not have bank cards. Cash will always be an option, MTA officials said on Friday.

    Eventually, too, the MTA can institute fare capping as Transport for London does in London. This system essentially converts pay-per-ride outlays to time-based caps after a rider pays for a certain number of rides in a certain period of time. After a rider reaches the cap, the rest of the rides in that time period are essentially free, and capping is a huge benefit for those riders who can’t afford to layout nearly $130 in advance for a monthly card or who wind up riding more frequently in a certain period of time than they anticipated. Any capping fare structure is still at least 3 or 4 years down the road, if not more.

    As to payment processing, the transaction is seamless and without the potential for swipe errors that currently plague MetroCard users. Payment card taps are nearly instantaneous, and Apple’s new Express Transit Pay feature means a user doesn’t even have to unlock the phone or pre-validate use of the card to pay.

    That doesn’t mean the initial pilot will feature smooth contactless transactions each time. During Friday’s press conference, Al Putre, the MTA’s executive director of new fare payment technology, spoke about the breadth of credit cards available throughout the world, a concern also raised by the MTA’s independent engineering consultant during a recent Board review of the project. There are, Putre noted, over 350 payment cards manufactured all over the world, and each have their own chipsets. “We’ve configured this system to match as many of them as we can find,” he said. “However, until we introduce them into the ecosystem and we run this pilot, we can’t be certain we’ve hit them. So hopefully with this process, we’ll identify any cards that need to be configured, and we’ll be good to go.”

    (Interestingly, the MTA’s decision to implement a contactless fare payment technology finally pushed the U.S. bank card industry to embrace contactless as a standard. The MTA spent a lot of time pressuring and working with these companies to bring contactless to the masses, and the industry expects these cards to spread rapidly as OMNY comes online. Bloomberg’s Jennifer Surane wrote an insightful overview on the behind-the-scenes negotiations that went into bringing OMNY to reality.)

    As to concerns over security, the MTA noted the technology adheres to payment industry requirements and vowed to continue its current practices. “It’s the same process as someone going to a MetroCard vending machine with a credit card,” Foye said. “We are not going to sell, lease or do anything with any customer’s information. That’s our policy today and that’s going to continue to be our policy.”

    I’m sure I’m not answering some questions a lot of New Yorkers may have, and I’m hoping to schedule a chat or mailbag on OMNY along with a few more Q-and-A type-posts. In the meantime, the MTA’s OMNY website discusses the future to come and includes the rollout schedule. The early returns though are promising. In fact, for its first full day of use on Saturday, OMNY saw 6100 taps, far more than the MTA had expected, and 80 percent of those were via phones, Vin Barone of amNew York reported on Sunday. “We’re thrilled,” Putre said, “New Yorkers are adopting OMNY even quicker than expected, and that the first several days have gone so well. The more that people use the system the easier it will be for us to learn what’s working and what isn’t, ensuring that New Yorkers will get the system they deserve — one that saves them time and hassle as they go about their day.”

    Ultimately, then, this is the true end of the MetroCard. We’ll be stuck with it until 2023, but the 1990s’ hot new thing that somehow became a familiar New York icon in short order is on the way out. The MetroCard is dead; long live the MetroCard.