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Pay by Phone - Love at First Sight?

Kiss the One Who Had That Bright Idea'

Neil Podmore

It's probably just as well that not many developments in the parking industry are so well-received by customers as to prompt them to kiss the nearest parking officer. However, the customer quote above is one of many unsolicited comments that have been made following the introduction of a pay-by-cell phone program.
Paying by phone for parking is an accepted revenue control solution that has been deployed worldwide with very favorable results; North America, Europe and Australia all have multi-city deployments. In North America, pay-by-phone has been deployed commercially since 2000 with more than 80,000 spaces active. Above all, it has proven to be a robust and reliable service that is popular with customers for its ease of use, and with operators for being highly cost-effective.
The key to the cost-effectiveness of pay-by-phone systems is that they should not require significant capital expenditure on physical infrastructure; the cell phone itself becomes the payment mechanism, a virtual parking meter. In the near term, it is appropriate to see pay-by-phone as an inexpensive upgrade for existing systems that provides customers with a credit card payment alternative alongside existing cash-based systems. Pay-by-phone is deployed in parallel with existing meters or fully integrated with new systems.
How does it all work? Typically, a one-time registration process by phone or online will record a credit or debit card, license plate number and cell phone number, and generate a PIN. Once registered, the customer can activate parking, up to the maximum time allowed, at any given location by calling a toll-free number or sending a text message (SMS). The customer indicates the space or meter number they are parked in, or the license plate of the vehicle they are parking, and the number of hours required. Most pay-by-phone systems send an SMS alert to the customer's phone, shortly before the parking time expires, that will remind them of the expiration time and allow them to call and extend their parking, subject to any maximum stay restrictions.
All very well for the customer, but how does enforcement work? This depends on the type of installation. In the case where pay-by-phone is integrated with meters that have a real-time wireless link, the details of the paid space or meter numbers can be reported directly to the meter, and enforcement is carried out as if the customer had paid at the meter. In the more common scenario, where pay-by-phone is introduced alongside traditional meters, enforcement data are sent to a wireless handheld device, such as a PDA or even a data-enabled cell phone. Parking Enforcement indicates which area it is patrolling, and the system displays in real-time the license plates or meter/space numbers of vehicles that have paid by phone. This list can be organized in a variety of ways to speed up enforcement and even integrated with handheld ticketing systems to reduce the number of devices that need to be carried. Another enforcement mechanism that has been deployed in Europe is a tag-based system that allows Parking Enforcement to query a tag in the vehicle to establish the payment status.
Management of a pay-by-phone system is usually carried out via a secure Internet-based interface that further reduces costs by eliminating the need to install and maintain local software. This allows operators to control rates and generate management and financial reports. Financial transactions are processed in real-time, which eliminates any possibility of fraud or overdrawn credit card accounts.
While pay-by-phone systems are becoming widely deployed and included in many RFP's, they are a foretaste of the opportunities for innovation and increased revenue that will occur as electronic payment mechanisms replace mechanical paper systems. Pay-by-phone is a popular consumer payment mechanism, but many businesses and organizations will choose to use Internet-based applications to validate their customers' parking or to create electronic digital permits that show up in the enforcement system the same way as a pay-by-phone transaction. In addition, fully electronic solutions easily enable services that include the ability for enforcement to send text messages directly to the owner's cell phone with a courtesy alert about issues such as lights left on or windows open. Likewise, managers can send systemwide messages to remind parkers about commuter lane restrictions or snow-clearing or street-cleaning. When starting their parking session, customers can choose to receive courtesy announcements or information messages by SMS that are relevant to the time of day and area they are parked in.
Pay-by-phone is a tried and tested technology that has become a cornerstone in the inevitable transition of the parking industry to electronic revenue control solutions. How long before every cell phone or On Star-equipped vehicle has a "Park Me" button?

Neil Podmore is with Verrus Mobile Technologies. He can be reached at (604) 642-4286 or via e-mail at npodmore@verrus.com.

Article Abstract from February, 2005




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