Hard Data on Mobile Usage

Nielsen Mobile put out new data today based on a global survey of 1 million mobile subscribers' use of the web on their phones, and the numbers continue to point to a growth narrative that is one of the strongest in the American economy.

Monthly Usage & Upside

Nielsen's data demonstrates that 40 million Americans access the Internet via their cell phones as of May 2008, which is 15.6% of the mobile subscribers in the US. This data is very consistent with what the Pew Center found that we discussed here. However, even more exciting is the fact that fully 95 million Americans have access to the mobile web through their cell phone service provider either by directly paying for it, or bundled with their other services. That number is up 28% from Q1 2007, but still accounts for just 37% of the 254 million mobile phone subscribers in the US.

These numbers are very exciting for Mpayy demonstrating that the installed untapped base is already 55 million strong. Further, continued growth of the mobile web subscribers to even 50% will more than triple the number of users today. Mobile data packages account for $1.7 billion in annual sales, and the average subscriber is spending $11 on monthly data plans.

Specific Uses

Nielsen's data contradicts what we discuss yesterday, demonstrating that the iPhone is #2 in the device list with 4% penetration, still a ways behind the 10% occupied by the Motorola Razor.


As far as the specific browsing habits, Nielsen reveals that 40% of mobile Internet users find their favorite sites through search engines, and 22% type in the exact URL. Just 17% of users find their sites through carrier portals, a number that is likely to continue to decline as iPhone, SmartPhones and imitators continue penetration.

Further, 5 million users in the US are accessing mobile banking websites that mostly just allow them to view their account balances and make a few payments. This number shows massive potential for breakout for Mpayy's Personal accounts that allow electronic payments to friends and family as well as roving salespeople that use Mpayy's secure Mobile Merchant account. As you can see from the left, email, weather and sports continue to lead mobile web usage, but watch out for Mpayy!

SmartPhone & iPhone Penetration Continue

This blog has covered mobile web usage growth as reliable numbers come out. A couple of interesting data points have been released lately that point to a high probability for the continuation of this trend.

SmartPhone Numbers

Nielsen Mobile put out numbers on SmartPhone penetration last week. The numbers are consistent with the Pew Research numbers we discussed here. Fully 63.9% of SmartPhone users are below 45, with 35.9% below the age of 35.

Further, focusing on this market exposes companies to some of the highest paid Americans with 35.1% having incomes over $100,000, according to Nielsen's data. These users are spending over $200 for their device and over $100 on their monthly plans, and 52% of those users are paying for the plans themselves as opposed to their companies remitting these fees.

Many Apples a Day

The Apple 3G iPhone launches on Friday, and though it is still 4th in the SmartPhone race, this year promises to be a barnburner. Apple expects to sell 5.1 million iPhones in Q3 2008 and another 6.5 million iPhones in the 4th quarter, according to numbers quoted by Silicon Alley Insider. Some analysts are estimating that Apple will sell 45 million iPhones in 2009.

SmartPhones and the iPhone are driving the move of functionality from the internet to the mobile web. As more and more of these phones come online, more people will begin to use Mpayy for free person-to-person money transfers, and independent salespeople and small businesses can use these phones as mobile Points of Sale. Check out our mobile website with advanced account management features.

Mpayy Widget Update - MySpace Approval, Embeddable Video Donation Widgets, etc.

Payment Applications Live on MySpace

Mpayy's global headquarters are a flurry of activity preparing for a relaunch of the website next weekend that will demonstrate Mpayy's utility in specific instances, and be a far more engaging website.

In the meantime, Mpayy has been making more headway with its widget. Last week, I announced the launch of the Lupus widget on Facebook.

Since then, Mpayy's Mpayyment Widget, and the Secure Lupus Donation Widget have received approval on MySpace. Interestingly, we do not see quite as much uptake on MySpace as we do on Facebook, and suspect that MySpace may have fewer "joiners" than Facebook where users are accustomed to amassing groups and applications on their profiles. However, MySpace does seem to be a more commercial site than Facebook, and we do have some expectation that the Mpayyment widget will experience greater usage on MySpace where people already sell music from their profiles. We'll have to wait and see.

I will share that the process for getting approval on MySpace was far more arduous than for Facebook. Fox Interactive Media's regulations of applications on its platform are more restrictive, specifically when it comes to payment applications. The MySpace Developer Terms of Service note:

7.3 If your MySpace Application collects any payment or account information from Users you must comply with the then current rules and regulations of all payment networks you use and the Payment Card Industry Data Security Standards available at http://www.pcicomplianceguide.org/pci-basics.html. Such collection of payment or account information may not occur on a MySpace Profile or any page within the MySpace Website, but may occur on your MySpace Application Canvas Page if the Canvas Page is hosted outside of the MySpace Website (e.g., i-framed displaying information from a non-MySpace website).. In addition, you must clearly and conspicuously disclose that any such collection is directly by you, and not by MySpace or FIM.

We were very happy when we saw this, because it lends itself to the security infrastructure of Mpayy, although it did require some modifications to allow us to provide a logo that demonstrates that Mpayy is unaffiliated with MySpace and Fox Interactive Media, delaying our launch for a few weeks. However, given the universality of payment widgets, when we created it, we specifically decided to NOT ask for a password until the popup enables the user to see Mpayy's URL and Verisign logo, so they can validate they are not providing their credentials to a fake widget masquerading as Mpayy.


Video Donation Widgets - Political Donations, Charities

Mpayy is pitching a number of charities right now, and we created the widget below to demonstrate the capabilities. This widget allows charities to embed a video for users to see that may tug at the heartstrings and drive viewers to make a donation. Mpayy adds another $1 to the ALR for donations from new accounts through that widget. I anticipate we will move to a model similar to this when we get better video for the ALR.

However, as the election season heats up, and down-ticket campaigners try to capture some of the magic that the 'Barama' campaign has found, they should consider embedding inspiring candidate speeches in a widget like this to help drive donations. Almost all campaigns' online donations are credit card only, and check donations come through snail mail. Mpayy allows these parties to receive check donations online with 50+% savings vs. credit card, and to put this donation capability anywhere on the Internet. If you know anyone running, send them our way!

Reconciling Retail Data

The Commerce Department reported retail sales numbers grew 1% in May, and revised April retails sales growth to 0.4%, up from the original estimate of 0.2%. This data is somewhat promising in light of the other troubles the consumer is facing - rising joblessness, falling home prices, and rising consumer prices including food and gas.

The retail sales report also demonstrated a 1.2% increase in sales among general merchandise stores, such as WalMart. Much of this spending increase could be related to the $300 checks received from the government stimulus package. Auto and home sales continued to show weakness in light of rising gas prices, and lends credence to the notion that much of the spending surge could be tied to the stimulus checks.

The promising retail data comes just one week after the Labor Department reported the largest one month increase in the unemployment rate to 5.5%, up from 5.0%.

There is some evidence that the offline world's performance can have some impact on the online world. TNR reports that online display advertising growth slowed to 8.5%, about half the pace of the previous year. Online advertising continues to grow faster than tv's, newspapers and other media. Similarly, non-store retailers - i.e. ecommerce and catalog companies - continue to maintain the strongest growth on a relative basis vs. other retail scenarios. eMarketer is forecasting that ecommerce sales will still top 14% in 2008.

Whether these online trends continue to be insulated from the offline trends will determine the overall economic outlook for 2008.

Join the Fight Against Lupus

Mpayy has officially joined the fight against Lupus with the Alliance for Lupus Research. Together, Mpayy and the ALR are working to leverage Facebook traffic to fight against Lupus. See the ALR's donation widget at http://apps.facebook.com/curelupus.

Mpayy will match each new donation account with a $1 donation to the ALR.

As the Consumer Goes....Must eCommerce Follow?

Endless Growth?

Last year, eCommerce sales grew 21.8% to $165.9 billion, vs and overall growth of just 3.9% for the broader retail industry. According to Internet Retailer, even big box retailers are turning to eCommerce sales more and more as that growth far outpaces the traditional stores, the share of revenues grows north of 30%. Even L.L. Bean, which made its bones through phone catalogue sales now counts almost 60% of their sales through their website.

Online sales continue to show growth this year in light of paltry overall economic growth of just 0.9% in the first quarter. According to Comscore, ecommerce sales are up an average of 12.5% in each of the first four months of 2008. The press release points out that after a weak March of just 9% growth, eCommerce rebounded in April to put in 15% year over year growth, though some of that may have to do with tax refunds hitting consumers' wallets.

The question is whether rising consumer prices that are compounding an already difficult economic environment will put an end to the growth in eCommerce. A gallon of gas is now at or over $4/gallon. Food prices are massively on the rise. Consumer confidence has fallen below 50 to 45.7 vs. 100 last September and 33.6% of the people surveyed anticipate a worsening business environment over the next 6 months according to the Conference Board.

Will retail in general and eCommerce specifically be able to sustain this growth?

What Do Payments Cost?

Internet Retailer digs into what the true costs of credit card processing are in attempting to educate its readers on how to pick among the various merchant acquirers. IR counsels that the Base rate, which is the rate many people think they're actually paying for each transaction, can be misleading. There are so many fees that go into credit card processing that the Base Rate can be less than half of the overall rate a merchant pays for a transaction.

Rates paid by merchants vary with the type of card, and the Interchange Rates vary as well, and can boost the Net Rate to well over 4%. Internet Retailer examines 6 different credit cards and the Interchange rates they face on an imaginary $169 transaction. The same article says 2.2% + $0.30 is the typical Base Rate for a mid-sized retailer. Compared with Mpayy's max price of $0.20 + 2.00%, the savings abound.



That chart shows at least a $3 cost savings on the part of the retailer for every transaction!

Further, a recent CyberSource Survey shows that not only can Mpayy bring online retailers around the country cost savings on their payment processing and 0% fraud liability, but it will boost conversion!



Mpayy has a good pipeline of new clients, but we are lightweight, easy to implement and infinitely scalable. We look forward to hearing YOU knock on our door.

As growth starts flattening due to a weak consumer, Mpayy is the place to turn to grow your online business!

Blue Steel & Other New Mpayyment Widget Skins

Lipstick on a Lamborghini

One of the things I planned to do when I started this blog was to document the empirical record of birthing and nurturing a startup. I've neglected it because at the end of the day, it's difficult to broadcast to the Internet's permanent record many things along the continuum from a lapse of concentration to tactical errors. Many times, one can become naturally reluctant to call attention to decisions and actions you've taken that materially improve the situation.



One thing that I am really enjoying is the depth of the hands-on education that becomes a necessity. I've alluded many times to the painful status of our front-end. It's like we've put a cover on the car the makes our underlying Lamborghini payment application has the shape and power of a Saturn coup. We'll be lifting the veil with a much more exciting front-end in the next few weeks that I think people will understand and enjoy. Matt Shea joined us about 5 weeks ago, and we will make the most of his skill set.

For my part, though, I have finally had the time to study and learn some basic web development skills with specific tasks that go into production. I've been working with websites since August, 2001, though I had to learn through work in connection with developers. My Poli Sci/Econ undergrad did nothing to prep me, and I started to get a grasp because I had a PHP developer and Oracle DBA who vituperatively despised one another. Through Zacks and Orbitz I became adept at writing Requirements documents, shepherding projects through design and development, and testing and maintaining the bug lists for a number of sites. As my career went on, I've dealt with sites at increasing levels of sophistication and transaction numbers, our present front-end notwithstanding.

The first full site pages I've ever created are the new micro-site for the...

Secure Payment Widget

Mpayy re-launched our Secure Payment Widget last Saturday with a new skin -- "Blue Steel" created by Matt Shea. We added some DHTML popups to help people through the system. Additional improvements to the widget were the ability to specify a new skin. We've created three initial skins in the forms of an iPhone, a Chocolate, and a kind of sad Blackberry. Mpayy's mobile payment processing system is now available as a phone skin on your blog or favorite social network.

(The widget micro-site denoted by the black buttons is a Trace Johnson original. Compliments and invectives are equally encouraged.)

The other exciting new piece of functionality we added to the widget was the ability to co-brand it with your own logo. This was necessary first to comply with MySpace application Terms of Service which stipulate that any payment applications must make perfectly clear that the application is unaffiliated with MySpace and Fox Interactive Media.



We went ahead and customized a bunch for fraternities and sororities @ our Gone Greek page also within the microsite.

Widget Commerce Tool

I was annoyed today when I saw a Payments News story on a UK company with a new Facebook widget to send money to friends, though they charge the sender 1% up to 0.50 euros. Mpayy is set to empower charitable donations, digital music & online auction sales directly through any social networking page. Mpayy's Mobile Merchant account is just $0.20 + 2.00%, less than PayPal, and more secure than most other online money transfer services being hosted within US Bank's data centers.