Airline to Introduce NFC App Following Successful Sticker Launch

May 3 2012

Scandinavian Airlines plans to introduce an NFC application for frequent flyers as early as this summer, enabling those with Android NFC phones to tap for a faster flow through check-in, security screening and boarding.

The application will follow the airline’s much-used passive contactless sticker, Smart Pass. Scandinavian Airlines, or SAS, began rolling out the sticker to customers last October in Sweden and has since expanded it to Denmark and Norway.

Although three quarters of SAS passengers carry smartphones while traveling, only a very small percentage have NFC phones, so use of the application will likely be low for some time after the app is introduced. But the airline said it is banking on NFC to help it offer more convenience to customers using mobile phones.

“We believe a sticker like this is not really what we are looking for in the long run,” said Lena Erneling Albers, manager on ground, product and customer services. “You can’t send them out to too many people. We plan to integrate it (Smart Pass) into NFC phones, but that requires NFC-enabled phones.”

SAS said customers have taken well to the Smart Pass stickers. Erneling Albers said 50% of customers who have been issued the passive stickers use them when they travel with the airline.

All told, the airline has issued 55,000 of the stickers and have 1,000 readers at airports in Scandinavia. The stickers contain the same information as the airline’s frequent flyer card, EuroBonus, which customers use to identify their trip at self-service kiosks for the airline check in and baggage counters, as well as at security checkpoints, lounge entrances and boarding gates.

The airline has 3 million EuroBonus members, and among these it issued the sticker to many of its most loyal frequent flyers, EuroBonus Gold members. It issued 20,000 stickers last fall in Sweden and another 35,000 in Denmark and Norway starting in March.

UPDATE: The 50% usage rate refers only to EuroBonus members in Sweden. A follow-up survey of these users by SAS found that 87% said they had applied the stickers to the back of their mobile phones, and 68% said they had used it at least six times since October. END UPDATE.

She told NFC Times she was surprised at how well received the sticker has been by passengers.

“Most people carry their mobile in their hand or pockets; it’s very accessible,” said Erneling Albers, speaking at the recent WIMA 2012 conference in Monaco. “We see this as the first step. We want to encourage mobile behavior in our passengers.”

SAS is a pioneer in using mobile technology, first sending flight info by SMS 15 years ago. It introduced SMS check-in about eight years ago.

Today, 15% of passengers use mobile phones to check in for their flights before arriving at the airport, which Erneling Albers said is the highest rate in the airline industry.

There have been at least a couple of other contactless sticker projects launched by airlines, including one introduced by Air New Zealand.

With the help of NFC technology, airline passengers will routinely tap their mobile phones to pass through security checkpoints and boarding gates by 2018, predicts major airline industry IT and communications services provider SITA.

SAS wants passengers to continue to use the Smart Pass application as much as possible to transmit their EuroBonus ID numbers to terminals, rather than relying on magnetic-stripe cards. Besides the EuroBonus number, the Smart Pass stickers store the account’s expiration date. Both the account number and expiration date are also written on the front of the 29-millimeter square stickers.

UPDATE: With the NFC application, the EuroBonus number and expiration date will be stored in the app itself, not on any secure element. The airline believes it does not need the extra security the secure element provides, since the application–like the cards and passive stickers–mainly identify the passenger's trip. At secure checkpoints, they would also have to provide a passport or other secure ID. END UPDATE.

Despite the high use rate of the stickers, Erneling Albers said the airline does not plan to roll them out widely.

For one thing, it would be difficult for customers to remove the stickers from the back of their phones when they change handsets.

Also, they could put a sticker on the back of a phone that has its own built-in NFC antenna, possibly causing collision problems for the contactless signals, Erneling Albers said. That eventually could become an issue as more NFC phones get released.

But while a greater range of NFC phones will hit store shelves this year, it could be a while before a sizable share of SAS’ EuroBonus members have one in their pockets, so that they could use the airline’s EuroBonus NFC app.

“We don’t really have any minimum customer base,” said Erneling Albers. “We are going to make it possible to download. Anyone with an NFC-enabled telephone, they will be able to use it. We do believe the penetration will increase rapidly.”

It remains to be seen whether Apple will support NFC in its next iPhone, or if it does, whether its implementation would support an NFC-enabled EuroBonus app.

That’s a concern for SAS, since of the 15% of SAS customers who check in for their flights with their mobile phones, more than half do so with iPhone. About 25% use Android phones.

 

HEADLINE NEWS

NFC Wallets Make Up Growing Share of Contactless Payments on London Transit

NFC TIMES Exclusive – Use of NFC wallets continues to steadily increase as part of Transport for London’s landmark contactless payments service, with payments from NFC-enabled smartphones and smartwatches now accounting for 20% of all contactless payments, NFC Times has learned. 

Market Research Firm: Apple Pay Surpasses Starbucks App in Users in U.S.

NFC TIMES Exclusive Insight –Apple Pay, which launched its mobile payments service five years ago this week in the U.S., has so far failed to live up to expectations with the service, either in the U.S. or globally, in terms of users and transactions.

Cubic Strikes Deal with Google to Enable Closed-Loop Transit Payments in Google Pay

NFC TIMES Exclusive Insight – In a move that could enable more large transit agencies to offer NFC mobile payments with their closed-loop transit cards, U.S.-based Cubic Transportation Systems has signed an agreement with Google to integrate contactless transit cards with Google Pay. Among the agencies planning to support the service are those serving Google’s home base in Silicon Valley and the San Francisco Bay Area, as well as the Metropolitan Transportation Authority in New York. 

In-Depth: Persistent Consumer Security Fears about Mobile Payments Prove Difficult to Dislodge

NFC TIMES Exclusive Insight – Results of yet another survey has shown that a significant percentage of U.S. consumers continue to harbor security fears about using their smartphones for payments, a stubborn problem that has hindered growth of mobile payments from the beginning.

Mobile Suica Still Accounts for Disappointing Share of Suica Users and Transactions in Japan

NFC TIMES Exclusive – While Apple Pay next month will mark the 5th anniversary since its launch in the U.S., there is another contactless-mobile payments service that is three times as old as Apple Pay–Japan’s Osaifu-Keitai, or wallet phones, which this year turned 15. 

Rome Latest Transit System to Launch Open-Loop Fare Collection; also Enables Monthly Passes with EMV Cards

NFC TIMES Exclusive Insight – Rome has become the second major city in Italy–and one of a small but growing number of large cities globally–to enable riders to pay transit fares with EMV contactless credit, debit and prepaid cards and NFC devices.

Vivo Last of Major Chinese Smartphone Makers to Officially Launch NFC Pays Wallet

NFC TIMES Exclusive Insight – Vivo, China’s second largest smartphone maker, made it official this week, launching its NFC-enabled “vivo Pay” wallet, the last of the major Chinese phone OEMs to roll out NFC payments–though their use has been disappointing, at least for payments in stores.

In-Depth: Fit Pay’s Troubles Indicate Difficult Business Case for Provisioning to Wearables

Sep 19 2019

NFC TIMES Exclusive Insight –  Given the poor financial results of U.S.-based Fit Pay, it’s becoming clear that the business case for provisioning of payment cards to wearable devices remains difficult.

Analysis: Chase Pay Latest Bank Wallet to Shut Down; Why Did They Fail?

NFC TIMES Exclusive Insight – Plans disclosed this week by JPMorgan Chase to shut down its Chase Pay app for in-store purchases is yet another nail in the coffin–perhaps the final one–for bank wallets in the U.S. And the situation does not look much brighter for bank-issued wallets abroad.

Miami Latest U.S. City to Introduce Open-Loop Transit Payments

NFC TIMES Exclusive Insight Transit officials in Miami-Dade County, Fla. are the latest in the U.S. to introduce open-loop payments of fares with contactless credit and debit cards and bank card credentials on NFC wallets, launching the service yesterday on the city's relatively small metro network, with plans to expand to buses later.

UK Tram Riders Take to Tapping with NFC phones to Pay for Fares, According to Early Results

NFC TIMES Exclusive – Transport for Greater Manchester, which last month launched open-loop payments on its large Metrolink tram network, said Thursday that contactless credit and debit cards and NFC wallets accounted for a combined 170,000 rides during the first four weeks of the service.

In-Depth: NFC Wallet Use for Open-Loop Transit Grows but Still Makes Up Relatively Small Share of Contactless Payments

NFC TIMES Exclusive – When New York City transit officials announced Tuesday that the 1 millionth ride paid for through their new OMNY open-loop payments service had arrived ahead of schedule, they also proudly noted that 80% of the contactless payments had come from NFC wallets, not physical bank cards.