Finnish smart card provider Confidex has announced a five-year
contract with the transit company for 125 million high-frequency payment cards.
Five years from now, China's Guangshen
Railway Co. (GSH) expects Chinese commuters to consume 125 million RFID-enabled
single-use tickets annually while commuting between the cities of Shenzhen,
where the railway company is located, and Guangzhou (the railroad connects the
two cities). That's how many RFID tickets the railway recently ordered from
Finnish company Confidex
as a five-year supplier contract, with 25 million tickets deliverable each year.
Confidex, based in Nokia , Finland, designs and manufactures
ultra-high-frequency RFID tags and also contract-manufactures reusable Gen 2
tags. The company says the entire market for these types of RFID tickets in 2005
was only 30 million, according to figures it obtained from integrated circuit
manufacturers. The 125 million-ticket contract is one of the largest single
orders for RFID tags thus far, it says.
To fulfill the contract, which starts in October, Confidex will establish a
subsidiary in Guangzhou, Guangdong Province, in southern China. The subsidiary,
XinTag, will market the tickets it produces there under the XinTag brand.
Confidex expects other railway companies in China to follow Guangshen's lead in
migrating to RFID-based ticketing, because it enables a more automated and
secure system than what many transit companies currently have in place.
The company also expects the Guangshen Railway to expand the use of RFID tickets
to its other rail lines in China. In total, 3 billion commuters use the system
annually. Today, Guangshen personnel use bar-code scanners to process the
single-use bar-coded transit tickets passengers purchase before entering a
train.
Ticket fraud is a "major problem" for the Guangshen Railway, says
Confidex CEO Timo Lindstrom. "The current bar-code tickets," he adds,
"can easily be duplicated using a photocopy machine."
Moving to RFID tickets will enable the company to eliminate counterfeit tickets,
Lindstrom explains, because the RFID inlays in the tickets will be
factory-encoded with an encrypted number that train personnel will read using
authorized handheld interrogators. Once the railway completely transitions to
the RFID-based tickets, he says, it may replace the manual ticket-checking
process with RFID readers embedded into turnstiles, which patrons would need to
pass through before boarding.
The Confidex tickets are made of paper, with a high-frequency (13.56 MHz) RFID
inlay containing a Phillips
MiFare chip compliant with the ISO
14443 air interface standard.
According to Lindstrom, the Guangshen Railway Co. will develop the RFID transit
ticket in-house, rather than hiring a third-party integrator. High-frequency
cards are already widely used for mass transit in China. Most buses, subways,
ferries and even taxis in such large cities as Guangzhou, Beijing, Chengdu and
Shanghai, already accept RFID-based payment cards (see China
Embraces RFID Smart Cards). China is also embedding high-frequency RFID tags
into its national ID cards.
