NEWS ANALYSIS Paying up
Not everyone likes to get their wallet out, but plenty of players are showing off new solutions that will take the wallet mobile.
T
owards the end of September, Google’s mobile wallet became a commercial reality, although it’s still a far cry from being a global initiative. Following
on from a trial announced in May, the service is supported only by the Samsung Nexus S 4G (WiMAX) handset on the Sprint network in the US. It’s a small start but the venture has already gained traction on the retail side through the MasterCard PayPass network—a merchant point of sale service covering more than 124,000 PayPass-enabled merchants nationally and more than 311,000 globally. This reach is further expanded through a worldwide
licence for Visa Paywave, which gives Visa-issuing banks the opportunity to offer Visa account holders the chance to add their debit, credit and prepaid cards to Google Wallet. Given Visa’s presence in Europe, the move certainly gives Google extra leverage. “Mobile payments are reaching a tipping point in Europe:
we believe that 2012 will be the year that new payment technologies such as mobile and contactless achieve mainstream consumer acceptance. The convergence of payment applications on the mobile handset presents an exciting opportunity for banks, mobile operators and manufacturers to work together to offer consumers choice in the way they make and manage their payments,” said Peter Ayliffe, CEO of Visa Europe.
The challenge for Google is how quickly it can build up a compelling commerce operation of this kind in the face of very competent rivals that are aiming to do exactly the same.
The move into mobile payments is also significant for Google as it presents an opportunity to drive new revenues besides advertising, the long-standing bedrock of Google’s business. Google has several related services alongside the new Google Wallet offering that if pulled together effectively could make for a compelling commerce framework with increased revenue potential. “Google is the master of search, provides popular location services, is building up a social media play in the shape of Google +, has a Groupon type proposition via Google Offers and is carving out a strong position in the mobile device value chain. If Google is smart then Google Wallet could be about a lot more than just mobile payments and incorporate loyalty schemes, check-ins, and advertising, among other things,” said Ovum analyst Eden Zoller. That said, Google Wallet still has a long way to
go before it is rolled out on a large scale and it faces competition from several quarters. Similar
12
announcements emerged in flurries over the summer months, from a line up including Amazon, Facebook, Paypal, operators like Orange and social commerce providers such as Groupon and Living Social. The operator community has been pitching its own
mobile wallet offerings, but in Europe, Orange has been one of the first to commercialise the technology, supported at point of sale by Mastercard. Orange’s European operations are promising to deliver an NFC-enabled version of the Samsung Galaxy S II from October as part of its Cityzi portfolio, which is designed to promote NFC services in France on behalf of the French mobile contactless association (AFSCM). The Android device will use the SIM card to guarantee the
security of contactless mobile services, which is where the system differs from Google, which is pushing the idea of a separate, dedicated ‘secure element’ within each NFC device. Orange predicts that a new generation of secure SIM cards will soon be rolled out in France and the group is working with equipment manufacturers to ensure that more than half of the new smartphone models are compatible with the contactless services. So the challenge for Google is how quickly it can build
up a compelling commerce operation of this kind in the face of very competent rivals that are aiming to do exactly the same. Commenting on the launch of Google Wallet and rival offerings, Fred Huet, MD of telecoms and media consultancy Greenwich Consulting, said: “The prospect of contactless payments hitting the mainstream market has got retailers, banks and manufacturers excited and Google was astute to initially announce its product when it did. “The beauty of Google Wallet is its simplicity; bringing
NFC to the masses via an application that allows for coupons and loyalty cards, thus making the whole process seamless. With Mastercard also lending financial credibility to the service, there is no reason why Google Wallet won’t be an industry standard payment platform next year - and converging on one standard could be the tipping point for intelligent and contactless payments to go mainstream.” The problem is agreeing on a common standard, as all
the players are pushing their own system as the industry champion. “We welcome market competition which ultimately improves consumer choice, but firmly believe that establishing a common platform across all handsets and operators, rather than a different one per operating system, is key to making mobile payments a reality. Too many different platforms can be confusing or restricting for those businesses looking to adopt them,” said a spokesman at Orange UK. The UK operators: Orange, Telefónica O2 and Vodafone
recently announced a joint venture to create a single, secure m-commerce platform. Safety in numbers is certainly the message here. “The relationship that operators have with their customers is built on trust, often over many months or years. Through monthly billing and communications, and the option to visit retail outlets and speak to call centres, operators can offer consumers the choice and reassurance they need to adopt mobile payments technology,” Orange said. n
Mobile Communications International | First for news, best for business
james.middleton@informa.com
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44