Victorian government begins search for future myki operator

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Victorian government begins search for future myki operator

As $700m NTT Data deal nears expiry.

The Victorian government has started accepting applications from providers interested in operating the myki public transport ticketing system following the expiry of NTT Data’s agreement in 2023.

The Department of Transport kicked off a two-year search to find the future operator of the smartcard system on Wednesday afternoon through an expressions of interest process.

NTT Data has operated myki for the past decade, having acquired Kamco – who scored the original $944 million deal in 2005 that ultimately blew out to $1.5 billion – in 2010.

When it came time to renew the deal in 2016, the government handed the contract back to the Japanese IT services firm for another seven years at a cost of $700 million.

The state’s auditor later characterised the re-tender as a “missed opportunity”, despite the inclusion of safeguards to avoid a repeat of mistakes that compromised the previous deal.

With the NTT Data contract set to expire in November 2023, the government is now looking for a myki operator to take the ticketing system forward by embracing new and emerging technologies.

The new provider will be expected to build on upgrades like mobile myki, which allows Android users to pay for public transport using a Google Pay-based digital myki smartcard.

The payment option garnered widespread support after it was introduced in March 2019, with 100,000 commuter’s ditching their physical card for the virtual equivalent in the first 11 weeks.

At the time, the government said it was looking to extend the feature to iPhones, providing $1 million in the 2019-20 state budget to investigate doing so.

But more than two years later, there is still no digital myki option for iPhone users, leading the department to call for “additional smartphone payment options” in the EOI.

The ability to tap on and off using contactless-enabled credit cards – which has been available in NSW since 2018 – is also sought over the next contract term, as are “account-based options”.

“The priority for public transport ticketing is to ensure users can safely and seamlessly access, use and pay for public transport,” the department said.

“In preparing for this EOI process, the [department] has looked at our current system, the experience of other major cities, and changes in technology and mobility trends.

“A key consideration for the transfer to a new contract has been to minimise any impact to passengers.”

The department has asked prime contractors or a consortia of providers that have “proven experience, capability and capacity” to register their interest to receive the EOI on Monday.

A second phase of the procurement is expected to follow in 2022, with the successful operator to commence when the currently NTT Data contract expires.

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