2008 Not the Year of Mobile Payments??? Au Contraire

Four days out from the launch of groundbreaking new payments technology, one finds themselves anxious, nervous, and somewhat conspiratorial, especially when that launch tends to coincide with the immediate wake of the Consumer Electronics Show and Macworld 2008. Both Apple and Google have filed patents over the last 18 months to make mobile phone payments, and the second hand on a clock turns more slowly than possibly conceivable. However, there is much reason to take heart.

NFC - Not (a) Fantastic Choice

David Chamberlain, Principal Analyst for In-Stat/MDR just published a report in December of this year. In it, he notes,

"Using mobile handsets to accomplish financial transactions and
purchases is starting to appear as something inevitable in the
worldwide marketplace. However, we do not believe that 2008 will be the
year of mobile payments. It may not even qualify as the year of trials
of mobile payments;...

The key enabling technology will be near field communications (NFC)
chips deployed into handsets as well as in merchant payment terminals."

I have inquiries into Chamberlain, and it is possible he is referring to paying with your cell phone in the bricks and mortar world. If that is the case, certainly Near Field Communications, or the placement of a chip within the actual device, will be necessary. This will essentially attempt to be a universal version of the Swipe-N-Go cards that gas stations and others issue their customers to go on their keychains.

Whatever chip is added to the phone will need to be universal, as unlike a keychain, the device is not likely to grow. Furthermore, whatever company ultimately decides to provide this option commercially will be forced to deal with all of the phone Operating Systems, mobile devices and the wireless service providers.

Further, there would need to be integration with and proliferation of merchant point of sale systems that can handle this communication and form of payment. As such, this is not likely to be a mobile-to-mobile payment option, and will require huge fixed investments.

Similar problems will continue to plague other companies that have so-called "thick-client" solutions in which users must download software on their phones.

Mpayy provides a secure mobile-to-mobile payment processing system that can be used for person-to-person money transfers. Similarly, purchases occur when the recipient account is a Mobile Merchant account. In other words, the 30 million independent salespeople in the United States doing $85 billion in sales will have secure payment processing systems with their mobile web enabled cell phones.