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The most interesting latest news on the topic: Mobile Payment |
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Isis, a joint venture among Verizon, AT&T and T-Mobile, named Austin, Texas as the second launch city to get its mobile payment service. The mobile payment platform is set to roll out in early 2012 in Austin, Texas, and Salt Lake City, Utah. Once retailers in both cities receive new near-field communication, or NFC, payment processing machines, users with Isis-enabled phones will be able to make credit card purchases simply by waving their phone in front of the machine. "You swipe once to pay, you swipe a second time with your loyalty card and then maybe you swipe a third time for a coupon," said Isis Jaymee Johnson, head of marketing for Isis, to the Los Angeles Times. "So, we're basically putting all of those transactions on the phone, so all you have to do is wave or tap your phone to the reader and then it recognizes you're a loyalty-program member and it recognizes what coupons you've downloaded and want to use." The mobile payment field has seen a lot of heated competition lately. As manufacturers like Sony begin to ramp up production on NFC-enabled phones, software giants, credit card companies, banks and cell carriers are all scrambling to launch services that support them. Google announced its "Google Wallet" feature back in May, a new app that uses NFC technology to let consumers make purchases with a few swipes on their Android phone. The Mountain View, Calif.-based company partnered with MasterCard, Citigroup, First Data and Sprint to offer the app to customers in New York, San Francisco and Portland at retailers like Macy's, American Eagle and Subway. In March, Microsoft announced its plans to enter the mobile payment market as well. The Redmond, Wash.-based company plans to offer its own service for making credit card-free purchases in a software update to its Windows Phone later this year. Major banks are also getting in on the mobile payment action. Bank of America, Wells Fargo and J.P. Morgan Chase last month announced their partnership called "ClearXchange." The service will allow customers to access their checking accounts and move money between accounts, all from their mobile phones. NFC is likely the door to the future of fast and easy in-store payments. The technology has certainly sparked a healthy competition that spreads across several industries. But with different companies launching in different cities, the mobile payment market has the potential to become fragmented before it truly soars. Insiders in the mobile phone industry have long referred to NFC as a technology with great potential. With Google Wallet set to launch this summer and Isis' plans for Austin and Salt Lake City in 2010, the competition the technology has birthed is growing rapidly. |
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Zoosh is a new technology that could give mobile payment capabilities to almost any phone, without the need of extra hardware, but its success is dependent on achieving a critical mass of users and supporting retailers. Developed by wireless company Naratte, Zoosh uses a phone's speaker and microphone to enable ultrasonic communications with other devices. The technology could allow fast and convenient contactless payments similar to e-wallet services that use near-field communications, or NFC, technology. "When we look at the current technologies out there, they have fallen short in trying to provide this device-to-device technology," said Brett Paulson, Naratte's chief executive. NFC, which lets devices communicate wirelessly over short distances, is the emerging standard in the turbulent mobile payment space, but only a handful of phones currently support it. Zoosh is positioning itself as an inexpensive stopgap, though if it establishes itself in the market, it could hang on as an option in low-cost handsets even after NFC becomes widespread. Zoosh, like NFC, could also simplify direct phone-to-phone communications like sharing contact data. It could even set up pairings with compatible Bluetooth devices. The company isn't the only e-wallet alternative, though. Mobile payment startup Square has a wireless payment system that works with iPhones using an inexpensive dongle that plugs into the headphone jack. And Starbucks has serviced millions of customers with its Starbucks Card Mobile app, which interacts with point-of-sale terminals via barcodes flashed onto the phone's screen. However, NFC remains the go-to technology. It will be used in Isis, a joint project of AT&T, Verizon, T-Mobile, Visa and MasterCard. Google is also using the technology in its phones as it conducts trials with MasterCard and Citigroup. In addition, Samsung and Visa will test NFC payments at London's Olympic Games next year. Whatever technology emerges as the standard, it will see mobile platform owners, carriers and traditional payment companies trying to monetize both the actual transactions and the valuable marketing data that will be harvested, as people helpfully build their consumer profiles by paying with their handsets. |
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Sony Ericsson is building near-field communication, or NFC, radio chips into its newest Android smartphones, heightening the mobile payment service battle that has emerged among the software companies, credit card companies, cell carriers and banks. NXP Semiconductors, a company that makes e-wallet technology, is supplying NFC chips for Sony's newest Android-based phones. The move into mobile payment phones may help Sony in its goal to become a top seller of Android devices. "This latest move from Sony Ericsson is another proof point of the strong momentum and potential of NFC," said Rick Clemmer, president and CEO of NXP Semiconductors. The addition of NFC also dovetails with Sony Ericsson's strategy to reassert itself in a competitive smartphone market by developing more innovative features and handsets. Last fall, Sony Ericsson refocused its efforts by leaving the Symbian platform in the dust and committing to the Android OS to compete with HTC, Samsung and LG. The company has used phones like the Xperia Play, which supports the same games as the company's popular PlayStation Portable gaming system, to grab nine percent of the Android handset market. Now, Sony hopes the addition of NFC technology will help increase that number. NFC is a much buzzed-about technology in the mobile phone business because it can pave the way to a wealth of new features in smartphones, and one of the biggest potential benefits of NFC comes from the user's ability to make mobile payments. Since NFC technology allows users to connect their smartphones to a point-of-sale system by holding their device in front of the payment screen, customers can then complete purchases with a swipe of their finger across the phone. However, only the NFC-enabled Nexus phone is offered in the U.S. Sony's announcement to include the technology in a line of its Android-based smartphones may more than double that market instantly. The increase in options will likely put a lot more NFC-enabled devices in consumers' hands. Phones with NFC technology haven't yet seen wide release, but that hasn't stopped Google from rolling out a service that supports them and several other companies from preparing for their arrival. The Mountain View, Calif.-based company announced its NFC-enabled Google Wallet service last month. The software giant also partnered with MasterCard and Citigroup to make the credit card free payments possible. Customers in New York and San Francisco with NFC-enabled phones can already use the service at major retailers such as Macy's, Subway, and American Eagle. Google may be a very early front runner, but the competition in the mobile payment field is furious. Microsoft is also announcing plans to add payment capabilities to its Windows Phone software as early as the end of the year. The update will also allow users with NFC-enabled phones to take advantage of credit card free payments. But major cell carriers like AT&T, Verizon and T-Mobile are not content to let the software giants corner the market. The companies are part of a coalition called Isis, along with nearly 800 other carriers, which is working on a standardized mobile payment system. Major banks are also part of the mobile payment fold. Bank of America, Wells Fargo, and J.P. Morgan Chase have partnered to buy their own payment service called ClearXchange. The service will let customers access their checking accounts and move money to other banks using just their cell phones. Sony's partnership with NXP aims to help put more NFC-enabled phones in the hands of consumers, but carriers, software companies and credit card giants are still battling over which NFC service phone owners will use. |
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Verizon has partnered with Payfone to bring one-click payment options to its customers, joining a list of other companies eager to grab a piece of the e-wallet business as it heats up. The Basking Ridge, N.J.-based carrier will partner with Payfone to allow customers to purchase goods using their cell phones all with one click. Customers can order digital goods like music and movies and pay for them, along with their monthly bills. They can also link their credit cards to the service to pay for physical and more expensive goods. Verizon customers do not have to upgrade their phones or download any applications in order to start using the e-wallet. The service will appear within their phone's browser as a link on retail Web sites. Any Verizon-enabled smartphone has access to the new service. Payfone, founded in 2008, is supported by companies like American Express and BlackBerry Partners. The company has said it aims to provide consumers with safe and secure purchasing on mobile devices, including smartphones, tablets and PCs. Verizon is also part of a joint venture with AT&T and T-Mobile called Isis, a mobile payment system where users pay for goods at stores simply by waving their cell phones at a checkout counter. Verizon has said its partnership with Payfone will not affect its agreements with Isis. "We have the gamut covered with mobile payments," said Greg Haller, Verizon's vice president of marketing. "This is one of the big pieces for us to finish that mobile commerce strategy." Verizon joins other companies and handset makers making the jump on the latest payment phenomenon, dubbed "e-wallets." Last month, Google announced its "Google Wallet" feature allowing customers to purchase items simply by tapping or swiping their Android smartphones in front of a merchant's payment reader, which is enabled by near-field communications, or NFC. So far, only MasterCard users can turn their phones into Google e-wallets. Research in Motion has also been busy getting into the e-wallet scene as well. In February, RIM co-CEO Jim Balsillie said the company was integrating mobile-payment services, using the same NFC technology, into BlackBerry devices, allowing users to make purchases with a swipe of their phones. In April, Apple partnered with Square and began selling the company's credit card readers which plug into the headphone jacks of iPhone and iPod Touch devices, allowing customers one swipe purchases directly on their iPhone. This system also comes with an app to process and manage credit card transactions. Verizon has yet to disclose when its e-wallet service will be made available. With many of the major players in the mobile industry adapting the mobile payment system, other online-intensive companies will surely join the fray as well. |
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Electric vehicle owners can now pay for charging sessions with a smartphone app, as mobile payments take root even in parking lots and car fueling stations.
Parkmobile and Liberty PlugIns, or LPI, have teamed up to create an app letting Electric Vehicle, or EV, owners pay to charge their cars via smartphone. IPhone, Android and BlackBerry owners with the app can deposit money directly from their accounts to the charging station, smoothing out the process for both consumers and merchants.
The app works using LPI's algorithm called Synchronous Codes, which transmits a unique authorization code from Parkmobile's servers to users' cell phones. EV owners receive the code via the app or by SMS and then pay the resultant charging fees by phone as well.
"Pay by phone billing and Synchronous Codes were made for each other," said Forest Williams, vice president of sales and new business development at Liberty PlugIns. "This is the wave of the future. Cell phones are already used to pay for everyday purchases in most of Europe and Asia. Tech-savvy EV drivers will appreciate the convenience."
LPI already links the EV charging stations scattered throughout U.S. metropolises to traditional parking meters for ease of payment. Pedestal, pole and wall chargers can all hook into LPI's system, giving even people like apartment dwellers, who don't have garage access a chance to charge their cars at a shared station.
Parkmobile is a parking service that leverages mobile phones as payment tools in an effort to smooth out a routine and often hassle-filled process. City-dwellers simply find a Parkmobile space and then call the service or access it with the Parkmobile app to pay for it.
Parkmobile and LPI's joint venture catches opportunity by the coattails, as mobile payments are becoming increasingly trendy and more and more businesses are incorporating them in their payment methods. Starbucks recently created an app that facilitated payments through smartphones, which has enjoyed a good degree of success with its clientele.
Mobile payments overall are set to take off. Google just unveiled its Google Wallet, an NFC-enabled service that lets Android smartphone users tap or swipe their phones against specialized payment readers without ever having to reach for plastic.
The fledgling service made such an impression last week that PayPal sued Google for stealing its ideas, underscoring how important PayPal considers getting out of the gate first will be, and the lengths it will go to slow down "early bird" in this new market.
Also major credit card companies Visa and MasterCard have teamed up with Verizon and AT&T to create the Isis mobile payment network, set to debut soon. And J.P. Morgan Chase along with Citigroup, Wells Fargo and others just bought ClearXchange, a service set to boost their place in the mobile payment race.
Square, too, has a chunk of the pie with its credit card-reading app and accessory for iPhones. Small businesses love Square for its low rates per transaction and its portability compared to traditional, clunky credit card-reading machines.
Parkmobile and LPI have chosen a profitable market in the mobile payment realm, and it could pick up even more if EVs gain in popularity as gas prices keep rising and people possibly turn to electric cars.
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Mobile payment technology could change not only how people buy goods but also how they return them, as new wireless "tags" are poised to replace paper receipts.
The near-field communications, or NFC, tag, created by Indian firm United Tectsa, allows retailers to verify electronically whether customers are eligible to return or exchange previously purchased items. To find out, merchants would simply tap a smartphone or other NFC-enabled device on a special tag placed somewhere out of sight on the product.
United Tectsa envisions a system wherein manufacturers would affix NFC tags to products, recording their serial numbers, product codes, batch numbers and manufacturing dates. Then retailers would add their own information to the NFC tag, including dealer codes, invoice and bill numbers along with the date of purchase.
If the product was defective or one wished to exchange it, a customer would bring the item back to the retailer, who would then confirm the validity of the consumer's refund claim.
No one can erase recorded NFC tag information, preventing people from pocketing illegitimate refunds. Furthermore, each time someone reads the NFC tag with a smartphone or other device, the manufacturing company's server will receive an SMS message. This way factories can confirm directly with the dealer whether the device is within its warranty period and whether repairs are possible.
Tectsa's innovation, if put into production, will be beneficial for everyone in the retail chain. Manufacturers could easily track defects and issue product recalls, while retailers will see fewer thefts and angry customers.
Meanwhile, consumers themselves won't have to dig through piles of old receipts when they want to replace or exchange a broken vacuum cleaner.
The NFC tag is only practical now that smartphones are beginning to get outfitted with the new technology and the mobile payment system is picking up. Google recently introduced an e-wallet initiative, announcing that people with NFC-capable Android phones, like the Nexus S 4G, can pay by tapping their devices at participating retailers' special payment readers.
The mobile payment race is heating up quickly too, as PayPal sued Google after its e-wallet debut, accusing it of stealing trade secrets.
No one wants to be left behind in the NFC dash, including credit card companies like Visa and Mastercard, which recently partnered with AT&T and Verizon to create the Isis mobile payment system.
They will face competition from institutions like Bank of America, Wells Fargo and J.P. Morgan Chase, which just bought clearXchange to create an NFC payment plan of their own.
Everyone with the right NFC readers and software could use Tectsa's system, giving it a wide and eager audience if it decides to market the technology.
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PayPal today sued Google for allegedly stealing trade secrets to build its new e-wallet platform, asserting its position in the increasingly competitive world of mobile payment systems.
PayPal alleges Google lured away two of its employees, Osama Bedier and Stephanie Tilenius, in order to learn rival secrets.
Bedier, according to the suit, was quietly interviewing with Google while simultaneously negotiating for PayPal to handle the sales end of Google's coming e-wallet.
The suit also claims that Tilenius, also a former PayPal employee, broke a non-disclosure agreement with her former employer in recruiting Bedier.
Bedier has been vice president of Google payments since 2011, while Tilenius became vice president of Google commerce in 2010. Both worked at PayPal and its parent company eBay for nine years before leaving to join the Mountain View, Calif.-based company.
But according to PayPal's lawsuit, Bedier turned coat and "is now leading Google's efforts to bring point of sale technologies and services to retailers on its behalf."
This alleged betrayal matters deeply to PayPal since it has been working with major retailers in San Jose, Calif., to develop a new kind of credit card reader. PayPal says it has also been in talks with Google for three years to become the company's main payment option for app purchases through Android mobile phones. For Google to steal its ideas and market them first would mean years of wasted effort for PayPal.
The suit comes on the heels of Google unveiling its "Wallet" service at a conference in New York. Both Bedier and Tilenius demonstrated the e-wallet's capabilities, which include allowing customers to simply tap their devices against a payment reader without ever reaching for a credit card. Google Wallet will debut in New York and San Francisco at retailers like Macy's and Subway to start with before adding others soon.
Hosing down Google's e-wallet parade with a lawsuit shows just how badly PayPal wants to remain on top in the competitive e-payment market. Six billion customers still use PayPal each day, as more and more people eschew brick and mortar buildings in favor of online banking and financial transactions.
Mobile payment volume on PayPal Mobile should more than double by year's end to cross $2 billion, showing tremendous growth at a time when consumers are just beginning to migrate to mobile payments in general.
But more and more banks, credit card companies and software giants are hurrying to roll out their own mobile payment ventures as the market heats up on all sides.
PayPal faces competition not only from Google Wallet, but also from Visa and Mastercard's joint venture with AT&T, Verizon and T-Mobile. Their Isis project is set to hit the market soon, prompting PayPal to innovate or risk being squeezed out by competition from major credit card companies.
Square, too, could pinch PayPal with its increasingly popular free credit card reader that fits into iPhone head jacks. Square charges merchants 2.7 percent per transaction, challenging PayPal's 2.9 percent fee per purchase.
For PayPal, wanting to remain top dog in a rapidly expanding market, a lawsuit against Google is a natural step in securing its position and staving off what could be a major competitor. But the crowd of competitors is only getting larger, with every player eager to get in on an expected $1.13 trillion market by 2014.
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Google today announced an e-wallet service, throwing its hat into a fiercely competitive mobile payment fight.
The "Google Wallet" feature allows people to purchase items by tapping or swiping their Android smartphones in front of a merchant's payment reader, enabled by near-field communications, or NFC. Another service, "Google Offers," works along with the e-wallet and lets users search for, and redeem, online coupons at the point of sale.
The Mountain View, Calif.-based company said its e-wallet is secure because it uses a phone lock, Google PIN and credit card encryption, and never fully displays users' credit card numbers.
MasterCard, Citigroup, First Data and Sprint will offer the service to customers in New York, San Francisco and Portland this summer. Macy's, American Eagle and Subway can now accept mobile payments from Android users in these cities, with more retailers expected to follow suit.
Stephanie Tilenius, Google's VP of Commerce, told listeners at the All Things Digital event in New York that Google is inviting "payment networks, carriers, and banks to join us in creating tomorrow's shopping experience."
Right now only MasterCard users can make their phones into Google e-wallets. While 300,000 merchants already use MasterCard's Paypass, which Google Wallet will lean on at first, the Mountain View, Calif.-based company needs to partner with other major credit card companies, too, if it hopes to have a bigger impact on the market.
Google is racing to get the service up and running, given the number of competitors cropping up. Mobile payment company Square already markets a free device that plugs into the iPhone head jack, charging merchants a mere 2.7 percent per transaction, compared to the normally exorbitant fees exacted from credit card companies.
Small businesses are embracing the technology because it does not require them to buy an expensive new credit card readers, or pay credit card companies at the end of the month.
AT&T, Verizon and T-Mobile are also joining to create the "Isis" mobile payment network, which was originally scheduled to run on Discover Card's systems. But the trio has had to drop Discover for Visa and MasterCard, since the two credit card giants weren't keen on being left out of the deal.
While plans are still hazy, a partnership between powerful wireless carriers and major credit card companies will present a real threat to Google Wallet, though Isis will have the disadvantage of coming late to the market.
For now, only owners of the Nexus S 4G phone on Sprint and the Nexus S model on T-Mobile can take advantage of Google Wallet and Offers. If successful, however, Google's invention could reach other phones and perhaps even hasten the death of paper receipts and plastic credit cards.
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Major banks are now competing for a place in the mobile payment world, bracing for change as electronic wallets begin to hit the market.
Bank of America, Wells Fargo and J.P. Morgan Chase today announced a partnership to buy a payment service called "ClearXchange," which lets customers access checking accounts and even move money to accounts at other banks using their cell phones.
For now the service is in beta and free of charge, though the three banks may charge for ClearXchange in the future as normal bank-to-bank transfers currently require a fee.
"Customers want to move payments from paper to electronic methods," said Mike Kennedy, chairman of the venture and payment strategist for Wells Fargo. "So if we can meet our customers' financial needs, they will be better customers with us."
As Kennedy suggests, banks now recognize the need to jump on the fast-moving mobile payment bandwagon before it leaves them stranded. With plenty of rivals circling around, Bank of America and the rest want to stake down territory before getting edged out by companies like Square and now Google.
The Mountain View, Calif.-based search engine giant is expected tomorrow to announce a new near-field communications, or NFC, payment system that will let users simply tap or swipe their phones to make purchases. Google is reportedly partnering with CitiGroup and Mastercard as well as VeriFone Systems and ViVOtech to ensure its venture takes off. Google hopes to lure in customers by including coupons and local deals in its NFC-powered payment system as well.
Besides Google, Square already markets a credit card reader that plugs into iPhone handset jacks, letting small business owners take payments without having to pay traditionally high credit card fees. Charging just 2.75 percent per transaction, Square's recently updated service even lets people purchase items by voice.
Along with Square and Google, AT&T, Verizon and T-Mobile are also scrambling to set up a mobile payment network. Their Isis e-wallet system was originally meant to run on Discover's network but will now join forces with Visa and MasterCard, as the two major credit card companies don't want to be left out in the cold.
PayPal is also getting into the game, announcing earlier this month intentions to create a point-of-sale mobile-payments system by the end of this year. PayPal has not yet disclosed specific plans for what it calls "proximity payments," but its leadership has said the shift to the point-of-sale is in response to fast-changing market conditions.
Unlike with PayPal, bank customers won't have to set up a separate account for their fund transfers, increasing the convenience factor of the banks' offering.
If the banks can capitalize on ClearXchange, they may yet hang on to their relevance as well as boosting revenue, an especially vital achievement in the current economy.
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Google tomorrow plans to unveil its NFC mobile payment technology, in an effort to compete with other players in this emerging $1 trillion industry.
The Mountain View, Calif.-based company's CEO Eric Schmidt is expected to demonstrate how consumers can make purchases simply by waving their smartphones in front of a store checkout reader at Google's All Things Digital conference in New York Thursday. The company plans to embed near-field communications, or NFC technology, in new Android phones, essentially turning them into electronic wallets, complete with coupons and loyalty points.
Google's Nexus S owners in San Francisco and New York will soon be able to swipe their NFC-enabled devices at retailers like Macy's, American Eagle Outfitters and Subway. Other cities will follow soon, sources say.
This isn't Google's first foray into the mobile payment world. The company also reportedly working with Citigroup and MasterCard, as well as credit card-reader manufacturers VeriFone Systems and ViVOtech, to ensure its mobile payment venture takes off.
Rival Square has done well for itself so far, offering free credit card readers that plug directly into iPhones. Square only charges a 2.7 percent of each transaction, so small business owners have been quick to jump on the arrangement, saving themselves the hassle of paying exorbitant fees to traditional credit card companies.
AT&T, Verizon and T-Mobile have announced their Isis mobile wallet system, which was originally set to run on Discover's network. But the trio are now partnering with Visa and MasterCard, since these credit card giants threatened to stall their efforts if they weren't included in the deal.
While they are rushing to participate, major credit card companies could, in fact, potentially clog the mobile wallet enterprise since they are still pushing plastic as the main means of payment. Understandably, they are less than thrilled at possibly being cut out of the purchasing equation altogether by services like Square.
PayPal, eBay and Amazon also aren't too keen on the idea of a mobile payment system since this would threaten their well-established Internet-based payment models.
At least Google will beat rival Apple to the punch, as the Cupertino, Calif.-based company says it has no plans to install NFC payment capabilities on its coming iPhone 5, citing a lack of industry standards as the reason for holding back.
If Google can navigate the delicate balance of appeasing credit card companies while steering plastic toward an NFC payment model, the software giant might well succeed, at least until rivals pick up the trail.
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