Excerpted from Luo Ruifa's speech:
This forum is organized by the Transportation Electronic Payment Association. My major in university is transportation engineering. Transportation should focus on achieving higher efficiency, safety, and lower carbon emissions. Obviously, the first attribute of traffic electronic payment is payment. There is a stylish expression today called "mobile payment", but actually ETC is the originator of mobile payments, for the payment has been completed while the vehicle is moving.
China's ETC system, in my view, has basically realized ETC 1.0 for the completion of the national networking. What will happen next? I will discuss this from the following 2 aspects:
First: ETC status and current problems
A decade has passed since the ETC national standards were drafted in 2006 and formalized in 2007. Up to now, ETC has 46 million users. It is estimated by the Ministry of Transport that the number of ETC user will reach 80 million by the end of the 13th Five-Year Plan period. In view of current development trends in the industry, there should be more than 80 million users, and even exceed 100 million if we are doing very well. If not, the market, including the market in mobile internet payment, electronic vehicle identification, GPS monitoring, may be getting smaller and smaller. Thereby, we need to spend more efforts in integrating and innovating at this critical development stage.
Currently, we are encountering the following problems in the ETC industry.
1) The number of ETC users is relatively small, about 40 million, compared with the hundreds of millions of mobile internet users.
2) ETC utilization is relatively low, with only 40% or even 10% or 20% utilization rate. Compared with developed countries such as the United States, and South Korea, the utilization rate definitely needs to be raised.
3) The clearing settlement system and encryption management need to be upgraded. The latest fraudulent events remind us the importance of security in the industry.
4) Service levels are expected to improve and the travel experience needs to be enhanced significantly.
5) Continuing expansion in ETC multi-scene integration is needed, specifically, the integration with other resources, capital and technologies, to form a complete industrial chain.
Second: How can we maintain the prosperity of the ecosystem in the next generation with more opening and innovative minds?
At this stage, the current national network has basically achieved ETC1.0. The next step is to realize ‘ETC +’ with more functions, applications, and service. In the next 3-5 years, if doing well, we will enter the ETC2.0 stage, and then the V2X stage with all traffic elements integrating with each other, to better support intelligent, autonomous driving, new energy, etc.
From the perspective of the ecosystem, "ETC +" is a concept with “plus” at its core, whose extension is based on the Internet, finance, OEM-installation, intelligent hardware, and etc.
From a strategic point of view, the development of ETC system is always from highway to urban area, providing drivers with smoother and more efficient service experience.
Efforts should be made in all aspects of application deepening and in the application development of ETC itself in order to further its development and to explore more possibilities.
Further exploration on ETC applications:
1) Cloud-based service. This is an improvement and enhancement to the basic service, enabling convenient mobile on-line top-up rather than inconvenient top-up service in counter. The billing inquiry and electronic invoice and other services like online shopping, OBU self-installation can also be completed using a cloud-based service connected to the mobile terminal.
2) Success transaction rate. The success rate in Japan is 99.99%, or even reaching 99.999%, but at present, a 99% success rate is barely achieved in China. Therefore, all relevant industries, whether dealing with devices, systems, platforms, applications, services or operations, need to work together to enhance and improve the user experience.
3) ETC lane coverage. The increase in ETC lanes will deliver a better user experience. With only one ETC lane, it is incapable of efficiently processing data. Therefore, more ETC lanes are needed.
4) Route identification. Route identification is an important factor in fee/toll collection. Both ETC and MTC are faced with route identification problems. If we can combine MTC with ETC, a significant integrative efficiency can be achieved in investment, utilization, management, and service.
5) Traffic information collection and service. When there are enough user base, vehicles, OBU, ETC can be a useful tool to collect and identify traffic information, including traffic flow data, providing users with real-time service.
Development of ETC application:
1) Promote OEM-installed or post-OEM-installed in vehicles. The long-term strategy for ETC requires further upgrades in the ETC standard with a higher bandwidth and better connectivity, so that it can be the standard configuration for automobiles. In this way, ETC products are combined with automotive electronics. And together with ETC-based network which features one card and one OBU for only one vehicle, the vehicle-related information, including owner or account, can be better identified. The utilization of the ETC products is thus enhanced and thereby increase the user loyalty.
2) ETC application at parking lots.. An ETC parking lot is a natural extension of the ETC applications, but there are other alternative technologies competing with it. Whether it will develop into a fundamental competition or can achieve a better service experience through integration, the experts in the industry hold different opinions.
There are five aspects for the parking lot management to achieve:
★ intelligent management
★ online operation
★ Service outsourcing / specialization
★ Integrated value added operation
By reviewing ETC under these 5 aspects, we can see that only 1 or 2 aspects are realized. What is the role of ETC for parking? Does ETC need park lot integration, or do parking lots need ETC? It is found out that it is ETC that needs the parking lots, but not parking lots. Therefore, we need to reconsider the integration of ETC and parking from a different perspective.
3) On-street parking applications. ETC has identification and payment functions. On-street parking requires a positioning function which ETC doesn't have at present, but we can integrate it with other technologies, such as a wireless positioning. In this way, ETC applications can be expanded to more scenarios, such as urban areas, parking lots, and on-street parking, bringing revolutionary changes which can provide a more seamless and convenient user experience.
4) Car-related service. ETC-based services can be extended to areas, such as refueling, vehicle cleaning, shopping, insurance, financial services, trade area entertainment, and traffic information service.
5) Financial services. ETC is based on a real-name registration system, by which we can obtain the consumption habits of the owner, ranging from toll collection, car insurance to personal financial services. By combining this information with the credit system, there is still substantial room for improvement.
The future of ETC is leading to V2X. Recently, the United States introduced a mandatory standard requiring all new cars equipped after 2018 to come equipped with the V2X 5.9G safety module. From safety perspective, the focus of traffic should be on service safety and efficiency improvement.
With an open and innovative mind, the industry is expected to form a dynamic “ETC+” ecosystem in a mutual beneficial way.