This paper examines the concept of eCurrency and how it has been used globally, and then highlights how this could be applied in Hong Kong. The situation in Hong Kong was assessed, and it is believed that Octopus is able to take advantage of its strong brand name and wide use taking its business online to an extended business model, termed eOctopus.
The eOctopus model suggests that Octopus becomes an intermediary in online transactions where the users will have the option to set up an online Octopus account on the web. Money will be deducted for online and offline transactions, and money can be added at current Octopus terminals or via Internet banking. It will also allow users to shop and pay bills online.
Given the development concerning the introduction of a smartcard (including an eCertificate function) to replace the existing Hong Kong ID card, synergies are expected to exist if Octopus were to work together with the government on this issue. Since every resident in a Hong Kong is required to possess an ID card, Octopus would thus gain in trust and overcome security issues, as expressed by respondents. The Hong Kong government could benefit from this arrangement, since Octopus′ technology and know-how regarding smartcards is advanced. If the eOctopus model is implemented in Hong Kong, it could then serve as a global role-model to the rest of the world, making eOctopus a successful eCurrency for online transactions possibly beyond the boundaries of HK.
Table of Contents
1 INTRODUCTION
2 BACKGROUND INFORMATION
2.1 INTERNATIONAL E-CURRENCIES
2.1.1 E-MONEY DIVISIONS
2.1.1.1 Credit Cards
2.1.1.2 Electronic Cash
2.1.1.3 Smart Cards
2.1.1.4 Micropayment
2.1.2 INTERNATIONAL OPERATORS
2.1.2.1 PayPal
2.1.2.2 Moneybookers
2.1.2.2.1 Benefits of Moneybookers
2.1.2.3 Mondex
2.1.2.3.1 How Mondex Works
2.1.2.3.2 Multi-Currency
2.1.2.3.3 Security
2.1.2.3.4 Risk Management
2.2 OCTOPUS
2.2.1 OCTOPUS TECHNOLOGY
2.2.2 BACKGROUND AND HISTORY
2.2.3 BIRTH OF INNOVATIVE IDEAS
2.2.4 FEATURES AND BENEFITS
2.2.4.1 Operational Benefits
2.2.4.2 Financial Benefits
2.2.4.3 Business Benefits
3 METHODOLOGY
3.1 GENERAL APPROACH OF REPORT
3.2 SECONDARY RESEARCH
3.3 SURVEY DESIGN AND DISTRIBUTION
3.4 COMPANY CONTACTS AND INTERVIEWS
4 FINDINGS
4.1 SWOT ANALYSIS
4.1.1 STRENGTHS
4.1.1.1 Market Leader in Smartcard Transactions
4.1.1.2 Focus on a Coin Free Strategy
4.1.1.3 Technical Leadership
4.1.1.4 Strategic Partnerships
4.1.1.5 Customer Relationship Management
4.1.1.6 Other Services
4.1.2 WEAKNESSES
4.1.2.1 Limited Technology
4.1.2.2 Switching Cost is Low
4.1.2.3 Limited Venue to Add Cash
4.1.2.4 Limited Usage of Octopus
4.1.2.5 Not Protected by Password
4.1.3 OPPORTUNITIES
4.1.3.1 Cross-selling Opportunities
4.1.3.2 Government to Introduce Smartcard into new HKID Card
4.1.4 THREATS
4.1.4.1 The Security and Confidence of Users
4.1.4.2 Competition
4.2 THE NEW ‘EOCTOPUS’
4.2.1 EOCTOPUS: HOW WILL IT WORK?
4.3 PROFESSIONAL FEEDBACK ON THE NEW EOCTOPUS MODEL
4.3.1 IS IT TECHNICALLY FEASIBLE TO UPDATE THE ONLINE OCTOPUS ACCOUNT AUTOMATICALLY WHENEVER ONE ADDS OR DEDUCTS MONEY TO/ FROM OCTOPUS AT THE EXISTING TERMINALS? IS IT TECHNICALLY FEASIBLE TO TRANSFER MONEY FROM AN INTERNET BANKING ACCOUNT TO THE EOCTOPUS ACCOUNT?
4.3.2 WOULD IT BE TECHNICALLY FEASIBLE TO UPDATE OCTOPUS AUTOMATICALLY TO REFLECT ANY AMOUNT CHANGES IN THE ONLINE OCTOPUS ACCOUNT?
4.3.3 COULD EOCTOPUS BE PROFITABLE?
4.3.4 WHAT SHOULD BE THE BEST-SUITED OCTOPUS' REGISTERED ONLINE SHOPS OR INSTITUTIONS UNDER OUR ONLINE BUSINESS MODEL?
4.3.5 WILL EOCTOPUS FULFIL RELEVANT REGULATIONS?
4.4 SURVEY FINDINGS
4.4.1 DEMOGRAPHIC FINDINGS
4.4.1.1 Implications to Octopus
4.4.2 ONLINE SHOPPING BEHAVIOUR FINDINGS
4.4.2.1 Experience of Online Transactions
4.4.2.2 Reasons for No Transactions Online
4.4.2.3 Frequency of Online Transactions
4.4.2.4 Online Transactions Amount
4.4.2.5 Implications to Octopus
4.4.3 EXISTING ONLINE TRANSACTIONS MODE
4.4.3.1 Implications to Octopus
4.4.4 OCTOPUS CARDS
4.4.4.1 Implications to Octopus
4.4.5 EXTENDED ONLINE USE OF OCTOPUS
4.4.5.1 Implications to Octopus
4.5 OVERALL SUGGESTIONS TO OCTOPUS
5 FUTURE OUTLOOK
5.1 NEW HONG KONG ID CARD, ECERTIFICATES AND EOCTOPUS
5.2 THE NEW SMART CARD AND EOCTOPUS
6 CONCLUSION AND RECOMMENDATIONS
Research Objectives and Key Topics
This study aims to assess the feasibility of extending the widely used Hong Kong "Octopus" smart card system to support secure and efficient online transactions. The primary research question explores whether the existing strong brand name and infrastructure of Octopus can be successfully leveraged into a new model, termed "eOctopus," to address the lack of dominant e-currency solutions in the local market.
- Feasibility of the "eOctopus" model for online payments.
- Analysis of existing international e-currency operators and their business models.
- Evaluation of Octopus' current technological capabilities and market position.
- Consumer behavior study focusing on online shopping habits and payment preferences among HKUST students.
- Integration possibilities with upcoming government smart identity card projects.
Excerpt from the Book
2.2.1 Octopus Technology
A major breakthrough in smart card payment systems in Hong Kong, the Octopus is the brainchild of advanced digital technology. It has taken over five years from initial preparations, to complete this complex system. Since then, the Octopus system has gone through many stages of enhancements while integrating the central system with numerous service providers’ management information systems.
Manufactured by Sony, the Octopus Smart Card embraces the following features:
• Fast transactions - applicable in different services like public transport, convenience stores and vending machines;
• High stability - the remote contact less feature allows the Smart Card to operate with more stability. This feature is particularly advantageous to services with high transaction volumes;
• Flexibility in applications - the Card contains many features which take care of everyday needs, ranging from travel on various public transports, door access to electronic cash; and
• Recycle usage - the card is reload able, so there is no need for disposal, and the PET material used to fabricate the card is environmentally friendly.
Summary of Chapters
1 INTRODUCTION: This chapter outlines the global rise of e-currency and the specific absence of such systems in Hong Kong, introducing the "eOctopus" proposal as a potential solution.
2 BACKGROUND INFORMATION: This section provides a comprehensive overview of existing international e-money divisions and operators, while detailing the historical development and benefits of the current Octopus system.
3 METHODOLOGY: This part details the research approach, including the use of secondary databases and the primary data collection conducted through surveys at HKUST and expert interviews.
4 FINDINGS: This extensive section presents a SWOT analysis of Octopus, the proposed "eOctopus" technical model, expert feedback from Professor Tam, and detailed results from the student survey.
5 FUTURE OUTLOOK: This chapter examines the potential synergy between the upcoming Hong Kong Smart ID card/eCertificate project and the future implementation of the eOctopus model.
6 CONCLUSION AND RECOMMENDATIONS: This final chapter synthesizes the research findings, confirming the general feasibility of eOctopus while suggesting further studies and regulatory investigations prior to a full rollout.
Keywords
eCurrency, Octopus, eOctopus, Hong Kong, smart card, online transactions, micropayment, feasibility study, consumer behavior, HKUST, eCertificate, electronic payment, brand leverage, digital security, retail technology.
Frequently Asked Questions
What is the core focus of this research paper?
The paper examines the feasibility of transforming the existing, primarily offline Octopus smart card system into an online-capable payment model called "eOctopus" to support e-commerce in Hong Kong.
What are the primary thematic areas covered?
The study covers international e-currency trends, the technical architecture of the current Octopus system, market analysis through SWOT, consumer behavioral surveys, and future integration with government digital identity initiatives.
What is the main goal or research question?
The primary objective is to determine if the high market penetration and strong brand equity of Octopus can be successfully extended to facilitate secure online transactions for local consumers.
Which scientific methods were employed?
The authors utilized a combination of secondary research from online databases and primary research, consisting of a survey distributed to 2,300 students and expert interviews with industry professionals and academics.
What is discussed in the main body of the work?
The main body evaluates the technical strengths and weaknesses of Octopus, compares it with international operators like PayPal and Mondex, presents survey findings on student payment habits, and discusses regulatory requirements.
Which keywords best characterize this study?
Key terms include eCurrency, Octopus, eOctopus, smart card, online transactions, micropayment, feasibility study, consumer behavior, eCertificate, and electronic payment.
Why is the "eOctopus" model proposed as a separate system?
The authors suggest a new eOctopus system rather than directly modifying the existing offline system to ensure that potential technical failures or early-stage issues do not compromise the integrity and public trust of the widely-used offline Octopus service.
How does the upcoming Hong Kong Smart ID card impact the proposed model?
The paper argues that integrating the new Smart ID card's eCertificate function into the eOctopus model could significantly increase user trust and provide the necessary security layer required for widespread online adoption.
- Citation du texte
- Ben Beiske (Auteur), Leslie Lee (Auteur), Iris Yim (Auteur), David Yu (Auteur), 2003, eOctopus in Hong Kong – A feasibility study, Munich, GRIN Verlag, https://www.grin.com/document/15457
