Operators call on handset makers to support mobile payments drive
Published: 19 November, 2008
Operators are placing high hopes on mobile payments to drive future revenues, and to strengthen their influence in the mobile value chain. A group of carriers has issued a call for handset makers to incorporate NFC (Near Field Communications, the standard for swipe-based and other very short range links) in the bulk of their models, from mid-2009.
They want NFC support to be included in most midrange and high end devices, and to include the ETSI standard for NFC interfaces, SWP (Single Wire Protocol). This would give a major boost to the existing Pay-Buy-Mobile initiative, launched earlier this year by the GSM Association, which represents cellcos. SWP provides an interface between the NFC chipset and a SIM card.
The GSMA argues that NFC chips are standardized and readily available, and so the time is right for phonemakers to adopt them on a broad scale. The main silicon on the market comes from the STMicro-NXP Wireless venture, which inherited technology from NXP, a spin-off of Philips, which worked with Sony on the standard. The chips communicate with contactless readers in applications like transport and in-store micropayments, and can link to a user's credit or debit accounts too.
The GSMA says operator trials by nine carriers in eight countries have already demonstrated that consumers can safely use the technology, and further pilots are planned across 14 countries by 15 operators. One major test has taken place in France, where Orange, SFR and two other carriers worked with seven banks on the 'Payez Mobile' trial in 500 sales outlets. Over 90% of the 1,000 consumers involved in the project said they found contactless mobile payment convenient, fast and easy to use.
Analysts at Juniper Research say that, while mobile payments are currently dominated by purchases of digital content such as ringtones, they will move towards money transfer and NFC-based purchases from 2009, and these will make up half the market by 2013. Despite major trials like Nokia's with credit card majors Visa and Mastercard, and devices from Nokia, Motorola, Sagem and the Koreans, the GSMA believes handset makers need to move more quickly to make this potential real.
The Pay-Buy-Mobile initiative builds on the infrastructure of the major credit card companies, which have developed specifications to ensure global interoperability between contactless chip cards and point of sale terminals.
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