UK’s mobile wallet project under Commission review (UK)
The mobile payment platform to be jointly owned by UK’s mobile operators Vodafone, Telefónica UK, and Everything Everywhere, has come under the scanner of the European Commission. The joint venture titled ‘Project Oscar’ enables mobile users to pay for goods and services via their mobile phones.
According to reports, the commission has cited problems regarding the future for competition in UK’s wireless industry as the prime reason for the review. As per a statement made by the commission, the initial review has highlighted potential competition concerns as the joint venture would provide the companies with very high market shares.
As per reports, commission vice-president and competition chief Joaquín Almunia, said that the commission is in favour of any initiative that will develop the promising mobile commerce sector in Europe and bring new and innovative payment and interactive advertising experience to customers. At the same time, they need to make sure that competing services can keep emerging on this market, so that incentives to innovate remain and customers get the best mobile commerce services at the best cost.
The commission added that the joint venture and its three parent companies may have the technical and commercial ability to block future competitors from offering their own mobile wallet services to customers in the UK, or to degrade the quality of these competing wallets so that they become less attractive.
The three mobile operators participating in the mobile wallet service said that during the course of discussions with the commission it has become apparent that the embryonic nature of the mobile payments market in particular means that more time is needed to fully consider the proposed joint venture’s plans for a mobile wallet and engage with the views of other interested parties. They remain confident that an extended review will conclude that the proposed joint venture is pro-competitive and will provide robust competition to global players.
Telefonica and Boku unveil global mobile payments partnership (Spain)
Telefónica Digital has announced a strategic agreement with BOKU, the global leader in online mobile payments, to enhance its payments capabilities. The agreement, which also sees Telefónica participate as a strategic investor in BOKU’s latest funding round, is a significant development as Telefónica gears up for the launch of its mobile wallet services. The partnership opens up access for BOKU to Telefónica’s global footprint of 25 markets and 300 million customers, while providing Telefónica with access to BOKU’s expertise in secure and reliable online mobile payments.
BOKU has pioneered the use of mobile as a payments mechanism, creating a network of merchants and a method of quickly and easily paying for virtual goods via the customer’s mobile phone bill. Its recently launched BOKU Accounts service expands this, enabling offline purchases in physical stores.
Under the terms of the agreement, BOKU will become Telefónica’s preferred mobile payments partner and Telefónica will extend its relationship with BOKU across its operating businesses. The partnership will provide Telefónica with access to BOKU’s merchant network, expanding the number of places customers will be able to use their Telefónica mobile wallet for purchases. It will also enable an enhanced user experience for online and offline payments, while also improving Telefónica’s own direct to bill capabilities.
Matthew Key, Chairman & CEO, Telefónica Digital, has said that payments are going mobile and they want to be at the forefront of this trend. BOKU has quickly established itself as a true innovator in the mobile commerce space and this investment and partnership gives access to their tools, infrastructure and know how, ideally complementing their own mobile payments expertise. Working with BOKU will allow them to both enhance their operator billing capabilities and the overall payment experience through their future mobile wallet services.
Mark Britto, CEO, BOKU Inc said that BOKU is proud to partner with Telefónica to increase the adoption of mobile operator billing amongst consumers and merchants across the World. They are excited to be working closely with Telefónica to develop an optimal mobile payments solution. This partnership will benefit consumers in several ways, giving them a quicker, easier way to pay across all their connected devices and a better deal at their favorite merchants.
Mobile payments expected to reach $30.5 billion by 2021 (UK)
Industry sources claim that owing to rapid technology upgradation and the increase in the number of smartphone users, British consumers are likely to spend as much as $30.5 billion by 2021 on purchases through their mobile handsets. As per reports, the mobile purchases currently account for $1.8 billion, with almost $417 million comprising of mobile sales from the food and groceries category.
Sources claim that mobile commerce is expected to grow by 55 percent over the next five years. Innovations such as Near Field Communications (NFC) and faster mobile data transmission play an important role in the success of mobile commerce, by offering users a more secure and convenient way to pay for goods and services. In order to better provide mobile payment services to their customers, network operators O2, Everything Everywhere and Vodafone joined forces to offer users a single system of paying for goods and services via mobile phones.
RIM and North American carriers battle over m-payments
Research In Motion is reportedly battling with wireless carriers in North America over their diverging mobile payments strategies.
RIM and the carriers disagree over exactly where the key data related to mobile payments should reside on the next generation of smartphones, slated to come out later this year, as this will decide who will control the customers, revenue and applications that grow out of mobile payments.
Carriers like Rogers Communications in Canada, and AT&T and T-Mobile USA in the US are opposing RIM and other handset makers’ strategy to make phones that will store mobile payments data, known in industry parlance as ‘credentials,’ in the devices themselves.
According to officials representing some of the carriers, this would bind users to phone makers’ devices and potentially cut carriers out of the loop. The carriers believe they want to encrypt and store the credentials in the phone’s SIM card as these can be easily swapped from phone to phone.
T-Mobile Czech Republic increases the mobile payment limit
T-Mobile Czech Republic has increased the limit for mobile payments from US$40.06 to US$68.68.
According to Vit Soupal, Senior Head of Mobile Payments at T-Mobile, more than 1,000 transactions are made via this platform every day, which represents a 100% increase compared to 2010.
The website is visited daily by 5,000 users. T-Mobile has also reduced commissions to make mobile payments more accessible to vendors. M-payment, one of the Pay-by-Mobile payment methods, enables payments for products and services via the web or WAP interface of mobile phones or over the internet.
The service uses a website-based payment gateway. The payment method is suitable for selling tickets for events, insurance, software purchases via e-shops, gaming portals, etc. Payments are deducted from credit on prepaid cards or charged on the monthly invoice.
Apple’s iPhone5 will not support mobile payments via NFC
Apple’s forthcoming iPhone 5 will not support mobile payments via Near Field Technology (NFC) despite a recent surge in interest in the service, and its addition to the Android OS.
According to sources, Apple had disclosed in meetings that it would not add NFC to the next generation iPhone. Apple told the operators that it was concerned about the lack of a clear standard across the industry.
However, as per the recent speculations, Apple’s motives, as it is understood, are to develop its own iTunes based NFC payment platform which would compete with the services being planned by the mobile networks, who are typically working with banks on rolling out the necessary hardware into retailer and travel locations.
Global mobile transaction value to reach $1 Trillion by 2014
A research report has revealed that while mobile transaction usage is growing, consumers show little willingness to pay for these services. The researcher’s predict unparalleled growth in mobile transactions worldwide, with the total value of global mobile transactions increasing from $162 billion in 2010 to $984 billion in 2014.
However, according to a survey result, less than 10% of respondents would be willing to pay extra for mobile transaction services such as mobile banking, mobile coupons and mobile payments.
Every silver lining comes with a big, dark cloud and the explosion in mobile transactions is much the same. Although mobile transaction service usage is increasing phenomenally, consumers show little interest in paying any additional fees for them. If banks, mobile operators, card networks and retailers want to tap mobile transactions as a revenue stream, they’ll need to come up with more creative schemes than per-transaction fees.
Researchers mobile transaction forecast tracks metrics on mobile banking, international and domestic remittances, contactless cards, mobile coupons and NFC communications. Other forecast findings include:
- Asia-Pacific overtakes EMEA as the mobile banking powerhouse: In 2010, EMEA leads all regions with 42 percent of worldwide active mobile banking users, followed by Asia-Pacific (38 percent), North America (16 percent) and Latin America (4 percent); by 2014, Asia-Pacific will lead with 54 percent, followed by EMEA (32 percent), North America (10 percent) and Latin America (4 percent)
- Mobile coupon usage explodes: The number of active mobile coupon users is expected to grow from 2.7 million in 2010 to nearly 35 million in 2014
- Near field communications (NFC) takes off: The number of NFC-enabled phones will grow from just 834,000 in 2010 to 151 million in 2014, a CAGR of more than 300 percent. Similarly, the value of NFC-based transactions will explode from $27 million in 2010 to $40 billion in 2014.
DoCoMo and KT Corp sign cross-border NFC deal (Japan, South Korea)
NTT DoCoMo and KT Corp have announced a joint agreement to develop cross-border services for mobile payments based on NFC technology, which they will launch in their respective markets of Japan and South Korea from around the end of 2012.
With the joint Business & Technology Cooperation Committee, the two companies are developing NFC common specifications that will be incorporated in devices, networks and billing platforms for seamlessly connected mobile NFC services. Customers travelling between South Korea and Japan will be able to access the services using compatible Android handsets embedded with contactless IC chips.
DoCoMo has tied-up with payment technology company brand Visa, NFC chip and mobile handset manufacturer Samsung Electronics and SIM card vendor Gemalto. In addition, DoCoMo will collaborate with Sumitomo Mitsui Card and bitWallet for cross-border services.
Furthermore, DoCoMo and KT will accelerate development of their existing infrastructures, as well as seek the participation of NFC-based service providers in various industries. DoCoMo has been providing NFC-based Osaifu-Keitai mobile-wallet services in Japan since 2004. KT has been operating a post-paid mass transit service in South Korea since 2002.
DoCoMo is also planning to submit an outline of the common specifications to global industry associations and standardization bodies, such as the GSM Association.
Mobile finance to take off across Latin America with new joint venture
Mobile payments could soon be greatly facilitated across Latin America following the announcement of a new joint venture between MasterCard and Telefonica. The two firms have stated their aim to lead the development of mobile financial solutions in 12 countries in Latin America where Telefonica is present with the Movistar brand.â€
The two firms have an equal stake in the joint venture, which will leverage banking relationships of both companies, Telefonica’s telecommunications assets and MasterCard’s payments expertise.â€
The alliance between the firms will allow customers to use their handsets and devices for various financial services, including money transfers, online shopping, reloading airtime and bill payments. Telefonica has called the agreement a step toward achieving financial inclusion for the underserved in Latin America positively impacting its economic development.â€
No timeframe for the launch of any products of services has yet been specified. MasterCard recently appointed a former VP of electronic payments at Orange, Mung-Ki Woo, as a Group Executive for fostering innovation, commercialization and development of go-to-market strategies to support mobile payments around the world.â€
