NTT DoCoMo hits 10m mobile wallet accounts
Published: 25 August, 2009
READ MORE: Japan | NTT DoCoMo
The leading cellular operator in Japan, NTT DoCoMo, says that it now has 10 million regular users of its DCMX contactless credit card phones, run under its Osaifu-Keitai service (mobile wallet service). We understand that a subscriber is someone who pays for banking services as well as micropayment use on their phones, and there are many more handsets out that that have the technology installed.
Subscribers of the DCMX plan can earn DoCoMo's loyalty points when they conduct transactions and use them for DoCoMo product discounts and in DoCoMo's online shopping mall.
Today, over 30 million DoCoMo customers actually have handset which contain the Sony built FeLiCa chips which make near field communication possible which can used for payment services and there are 420,000 readers in retailers nationwide for shopping at convenience stores, electronics retailers, fast food restaurants and even in taxis.
Japan has well over 100 million handsets, of which NTT controls about 55 million, and it introduced the service in 2006, so this is a real indicator for Europe and the US just how slowly a business model for contactless payment systems develops. A contactless device is one where you can make rapid payments under a certain level (say $20) without using a PIN number, just by putting your phone within 3 cm of a keypad. More expensive purchases above a threshold level, require a PIN.
Devices of this type can be used to issue and collect travel tickets, to speed entry to stadiums and entertainment sites, and to make all types of general in-store payments and to run loyalty schemes.
There has been a political battle across both Europe and the US in getting near field communication chips into phones to enable a mobile payment platform. As usual it is all about who pays for the devices and how everyone gets paid. Banks consistently refuse to concede any percentage of the payment servicing charges to operators; retailers resist because they have to buy new EPOS equipment; handset vendors want to be paid more for their NFC phones while operators need a clear business model for making money out of the new devices.
Some operators see holding the Olympics in London as an opportunity to get a head start, and offer tickets sales and travel tickets through handsets, while other operators cannot see the business model and are alarmed at the possibility of a sudden rush by users to switch to subsidized NFC phones.
The single-wire protocol at the centre of the technology in Europe has acted as an obstacle for some time - a single route in and out of the NFC chip to the other components on a phone - but this standard is now set in concrete and the specification for NFC phones in Europe is now ready.
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