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140 Big Data Analytics for Connected Vehicles and Smart Cities The Practical Application of Analytics to Transportation 141

• Electronic fee collection for car parking.

An integrated payment system would incorporate all three to enable a
single account to be used by a traveler to pay for all three services. While a
single account would be used, it would be possible for the traveler to use one
of a selection of defined payment instruments, such as a transponder for elec-
tronic toll collection, a smart card or a smart phone for transit ticketing, or fee
collection for car parking. The single account for tolls, ticketing, and parking
payments would be administered by an integrated back office capable of sup-
porting transaction processing, customer service, and analytics.
The integrated back office could be achieved by the deployment of a
single system or through conductivity between separate electronic toll collec-
tion, electronic ticketing for transit, and electronic fee collection for car parking
systems. While a single integrated system may provide more benefits, the best
use of sunk investment in legacy systems will probably be achieved through
the development of middleware and interfaces between existing single-purpose
systems.

7.5 Why Does Integrated Payment Make a Good Departure Point
for a Smart City?

Many cities around the world have a significant investment in electronic pay-
ment systems of one form or another. These include electronic toll collection,
electronic transit ticketing and electronic fee collection for car parking. This
legacy of sunk investment in electronic payment systems is one reason why it
would make a good departure point for a smart city. It is not just the dollars
involved; it is also the acumen and experience that has been accumulated over
the course of the investment in electronic payment systems.
Another reason for starting with an integrated payment system is an obvi-
ous one—it can generate revenue. An electronic payment system provides the
mechanism for transportation services to be paid for on a pay-as-you-go basis.
This provides an alternative to common funding for transportation services
through taxation. This mechanism also provides a pathway for the private sec-
tor to be involved in the development of projects and the delivery of services.
The ability to pay provides a mechanism for a return on investment by the pri-
vate sector in return for the capital and operating resources required to establish
the service. It is highly likely that the private sector will seek to find opportuni-
ties where profit is possible and where mechanisms for payment also exist. This
might be one of the reasons why traffic signal systems have never really been
privatized, certainly not in the United States.