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Laks : A futuristic company in contactless gadgets

Not so long, about 10 years ago, if someone had told you that you could process a payment transaction with your watch, you’d probably laugh. But things have changed in an enormous speed and since last few years, this definitely possible and there are people actually doing this now.

This has been possible by a company -Laks, whose vision is beyond most of the people in both card payments and watch industry. Laks is a Vienna based company developing very cool watches that have a dual interface chip slot and the watch has an antenna inside the watch. The antenna plugs into a specific type of SIM sized dual interface chip produced specifically to fit in this environment. There is the possibility of running many applications on the chip. Actually there is the possibility of requesting any kind of chip in this form, which means that sky is the limit for implementing a chip application inside a watch. Laks also has native mifare chip embedded into the watch. Although I’ve never asked, I am sure that they can fit any kind of chip inside a watch.

Watches come with the antenna, while the dual interface chips do not necessarily. If so, personalization process must be processed while the chip is in the watch, which is something hard to do when personalizing huge volumes.

In Turkey, Garanti Bank launched a product based on Laks watches a few years ago. It was a little bit early, however it was still a very innovative product. In Turkey, there were efforts to develop a payment product based on Laks’ watches, which some of them had already passed the proof of concept phase, unfortunately they were never launched.

Maybe, the commercialization did not happen due to the fact that watch is a personal thing (like a mobile phone in the NFC case) and a payment product bundled in a personal stuff might not sound good to people. But I am sure there will be some contactless projects based on watches and Laks will definitely have a big role in this picture. There are more interesting watches other than having a contactless capability in Laks’ web site, worth to visit.

Calypso the ticketing master

When we talk about transport ticketing, Calypso is the technology we must discuss first. Calypso is a transport ticketing system built by the transport operators. It was designated to match the transport ticketing requirements from functional flow to security mechanisms. The main identifier of Calypso is that it requires a micro processor card. This enables all the security required by complex transportation environment.

So, what is Calypso?

Calypso is a ticketing application developed and maintained by Calypso Association. Calypso Association, based in Brussels, Belgium, was established by RATP and technology provider Innovatron in 1993. Later on, group of European transport operators from Belgium, Germany, France, Italy and Portugal joined the association. Calypso ticketing application is currently being used by various European public transport systems.

In the Calypso world, you can define various players into a single card (now the term “portable object” is used though, rather than “the card”) and they can share the same balance. The technical design of the application supports multi-application by nature. Different contracts can be installed on to a single card which are protected by different key sets. Each Calypso chip has a set of derived keys from master keys. DES and DESX (an implementation of DES against brute force attacks) can be used for authentication. Calypso requires its own SAM card for authentication which is a pre-requisite of modifying the data in the chip.

Unlike typical mifare designs, you are restricted by the boundaries and transaction flow developed by Calypso, but it covers almost anything that can be expected in a transport ticketing environment. Calypso applet runs on micro processor chips, so authentication is quite strong (and fast)

Calypso Association plays an innovative role towards the NFC era and they seem to be ready for the NFC evolution. (I wish I could say revolution, by the way) Calypso applet runs on various card operating systems varying from Infineon to Watchdata chips, including NXP’s JCOP family. Of course this includes any secure element in the NFC world.

Based on my personal experience, I can say that Calypso is an equivalent of EMV in the banking payment world. Both of the applications are quite well designed, already running on millions of chips and getting ready for the future.

First DESFire implementation on a SIM platform

Mifare emulation has been around for some years. Mifare emulation simply refers to an application running on a chip card operating system. The application emulates the native mifare chip and responds the mifare readers as if it is a mifare chip. Of course there are some considerations when implementing a mifare emulation. First of all, it is not native mifare and the terminal software needs to be updated accordingly to recognise the chip. Secondly, mifare emulation is not as fast as a native mifare chip so some parameters must be updated to transact with the mifare emulation applet.

These have been done since some time, but Gemalto has started a new era by implementing the DESFire application on a SIM/UICC. Even the owner of the technology -NXP, does not officialy have DESFire emulation yet. It’s a huge thing in terms of innovation. However there’s still some time before a DESFire enable transportation system is to accept an NFC handset device with a Gemalto SIM/UICC.

Gemalto has been aggressive on the contactless market almost since its start and this is clearly a result of it. Read the full press release here.

Transportation task force from GlobalPlatform

Access control applications and transportation systems were the “killer applications” that caused the boom in the contactless cards. Access control systems are generally do not require anything more than a unique id, but transportation systems are more complex.

Speaking generally, two products dominate the contactless transportation installations: NXP‘s mifare family and the Calypso family, which are famous from the ISO 14443 Type A and B, by the way. Mifare has been dominant for years, but with the security leak that was imposed by the German CCC has been quite a barrier for Mifare lately. NXP responded with Mifare Plus, which is a product designed for migrating the current systems without changing the card media. I think it’s a very good move.

In the last 3-4 years, we saw that banks are trying to penetrate into the contactless transportation systems. Unfortunately the technology that the banks have -EMV- can not respond to the transportation ticketing requirements. Both Visa and MasterCard are working on this.

On the other hand, I saw a very interesting news on Near Field Communications World.com about GlobalPlatform‘s new task force on transportation systems.

I think this will eventually lead to more standardized schemes in the transport ticketing world. Both NXP and Calypso already have compliant products with GlobalPlatform. But the effort that the GlobalPlatform itself will make more efficient affect, not just on the cards, but the readers and terminals as well. It’s also important in terms of NFC based payment scenarios in the transportation since the GSM world will be using a SIM-centric systems based on GlobalPlatform standards.

Introduction to ISO 14443

ISO 14443 is a collection of rules regulating the contactless smart cards and readers working at 13.56 Mhz. The main idea is to create a interoperability between contactless smart cards and contactless card readers.

There are 4 parts of ISO 14443:

Part 1 – Physical characteristics

With the introduction of contactless chips in different forms like watch, stickers, keyrings, etc, this part has been obsolote in the last years. Originally it was defining the dimension of the contactless cards based on ISO 7810. In general, card and the reader are referred as PICC and PCD. PICC stands for Proximity Integrated Circuit Card and PCD stands for Proximity Coupling Device.

Part 2 – RF interface

Part 2 defines the characteristics of the power transferred to card for enabling the contactless transactions. Power is transferred by the reader to card using a frequency modulation of 13.56 Mhz. (+/- 7 Khz is accepted)

There are 2 famous types of communication signal interfaces; Type A and Type B. Although many people think that type is equal to Mifare and type is Calypso, it’s simple not true.

Part 3 – Initialization and anti-collision

In the contact card world, only one card is possible in the reader slot, but in the contactless world, this is not always the case. Part 3 deals with selecting a card in the RF field. Anti-collision is basicly selecting one card at a time and holding the other cards in the field idle for the next transaction.

Part 4 – Transmission protocols

Part 4 defines the high level data transmission protocol between the card and the reader.

ISO 14443 does not define any operating system of a card or reader or any application running on each end.

Gemalto acquires Trusted Logic

Worldwide software solution developer for smartcards, terminals and consumer devices Trusted Logic has been acquired by Gemalto. See the Press release for details.

Gemalto had already acquired Multos and Mifare4mobile before and now the company is holding a unique position among the card vendors.