Japan Gets Digital Ticket System

August 21, 2002 — In the United States, mobile commerce has so far been limited to toll collection systems and ExxonMobile’s popular Speedpass. Europe has done a little better, with governments introducing smart cards for mass transportation and other services. But when it comes to mobile commerce, the Japanese are in the fast lane.

This week, Pia Corp., Japan’s largest ticket company, and NTT Communications Corp., the nations long distance phone carrier, announced plans to set up a separate company, Pia Digital Lifeline, to offer electronic tickets. And press reports in Japan say seven local credit card companies backed Sony’s electronic wallet.

The concept behind Pia Digital Lifeline goes beyond simply enabling consumers to book tickets to movies and other events on their mobile phone, or PC, and then pick them up at the box office. The company wants to create a standard means of authorizing transactions and storing e-tickets on smart cards or chips in mobile phones.

The plan is for microchips to store information on the venue, starting time and the seats booked. Readers installed at venues will be used to check proof-of-purchase codes stored in cell phones or on smart cards. So if you order by cell phone, the ticket information and authorization code are downloaded to the chip in the phone (or a smart card if you use a PC). Then, you simple swipe the device near a reader at the movie theater, amusement park, concert hall or other venue. The system can also store e-coupons.

Users will be able to sign up for the service on Pia’s Web site and make payments via credit card or through online banks. NTT will manage the e-tickets and e-coupons from Pia’s system and provide the gateway to authenticate consumers that are registered for the service.

Pia and NTT will test the e-ticketing service using I-mode phones from NTT DoCoMo at the 2002 Tokyo International Film Festival, from Oct. 26 to Nov. 4. Pia says it hopes to get about 5,000 venues, including cinemas, playhouses, sports facilities, concert halls and amusement parks, to adopt the e-ticketing system. The company expects to get about Y20 billion (US$169 million) in e-ticket bookings in the venture’s first year.

Sony also scored a major coup this week when it signed up seven major consumer credit companies to adopt its electronic money system, called Edy. The system will enable credit card holders to store electronic money on chips in their smart cards. The money can be used to pay for Web content, fast food and other small purchases.

The seven credit card issuers are UFJ Card Co., Life Co., Daiei OMC Inc., DC Card Co., Kokunai Shinpan Co., Sumitomo Mitsui Card Co. and Sony Finance International Inc. Together, they are expected to issue 2 to 3 million credit cards with the Edy technology by the end of 2003.

Edy was created by bitWallet Inc., which was established in January 2001 by Sony, Toyota Motor Corp. and NTT DoCoMo. Edy is a prepaid, contactless smart card that stores information on an RFID microchip. BitWallet, which manages the system, expects to have 23,000 retailers, including Web sites, accepting Edy payments by the end of 2003.