I think that it means that the majority of the processing is being done by the customer's device, not some server in AWS that costs money. But you still need to provide a back-end API for the app, so I don't think it makes that much difference myself.
I don't understand the maths behind that. If they're giving away 2% but they only get 5%, the remaining amount does not even come close to paying the costs of retailing, which include the journey planner, RARS2, staffing, customer support, complaints, ToD and e-Ticket fees, accreditation costs, ticket purchase fees, infrastructure costs, card fees and probably a whole bunch more.
You can't properly cover that on 5%, so you certainly can't on 3%, no matter how much data you gather and how much you can expand sales. So you must be cross-subsidising from somewhere else. Question is, is that morally or even legally acceptable?
Really? They seem to work remarkable well on my phone.