| |
|
The most interesting latest news on the topic: Mobile Payments |
|
|
|
|
|
|
|
|
|
|
|
|
PayPal is taking the express lane to in-store mobile payment dominance -- but competitors' efforts and consumer suspicions may block the road to success.
PayPal is joining forces with several major retailers, including Toys R Us and Barnes & Noble, as it solidifies its retail presence to boost its movement into mobile payments. The eBay-owned company signed deals to partner with sixteen major retailers in total, starting with Home Depot several months ago. PayPal also inked a deal with VeriFone Systems, which will help it establish smooth in-store services using VeriFone's payment software. "An important part of our future is to get to ubiquity," PayPal exec Don Kingsborough explained. "There will be 40 million terminals eventually to let consumers buy in stores with PayPal. That's one of the big building blocks we have to get to ubiquity." PayPal is off to a solid start and has an established online payment history behind it, but the company will have to reprove its security credentials to entice in-store customers visiting brick-and-mortar retail locations. The company is buddying up with large, trusted retailers and gradually adding waves of partners to ensure success in this arena, but it still faces stiff competition from upcoming mobile payment alliance Isis. PayPal's name recognition and a strong reputation alone won't be enough to topple Isis, which is making a concentrated, comprehensive effort to offer exemplary security. The big banks and phone carriers attached to the Isis project may convince people to give Isis a whirl. Both mobile payment options, along with rivals Square and Google Wallet, must contend with consumer reluctance to trust mobile payment systems and fuel their adoption. PayPal's decision to directly link to trusted stores may assuage some wariness, but if the company's security is compromised even once it could devastate its reputation. Inking the retailer deals set the company on the right path, but to surge ahead of Isis and other rivals, the company needs to keep making alliances with retailers and cementing its place as a convenient and safe payment option. |
|
|
|
|
Thinking of buying those shoes with your iPhone? Make sure you're protected from identity theft first.
Neal O'Farrell, the executive director of the Identity Theft Council, gave a talk called "The Hackers Are Coming -- Why the Small Business is the Big Target and What You've Got to Lose" to highlight the dangers of mobile banking for small businesses. O'Farrell believes the dangers can jeopardize a large segment of businesses and people, explaining, "Eight out of ten mobile banking apps have security flaws, but Apple and the banks don't want you to know that. I'll wait another 20 years to stick my toe in that pond." Even users with Macs can get their information stolen, and recovery is often problematic. Identity theft via online banking is on the rise, but police investigate less than 1 percent of the crimes. O'Farrell advocates using a separate, cheap netbook for money transactions, so more frequently used mobile devices won't have the sensitive information on them. Online banking is far from safe, and mobile finance systems taking stabs at winning loyal users will meet difficulty if people realize how vulnerable their security is to attempted hacks. O'Farell's advice is at odds with the intentions of a variety of up-and-coming mobile payment systems including Isis and Google Wallet. These businesses will only succeed if consumers feel comfortable with online financial transactions, but O'Farrell points out the need for caution. Isis could have an easier time because it went to great lengths to round up an expansive coterie of security backup, but it still may not outsmart greedy hackers. In addition to plumbing smartphones and tablets for financial information, hackers also recently targeted medical data, highlighting how identity thieves are liable to explore lots of options to gather sensitive information. The medical records contained information the hackers could use to figure out passwords and banking information, so although it was not a direct attempt to steal money, identity theft was the end goal. This suggests hackers could also breach smartphones without banking information on them and use other sensitive data to puzzle out account information anyways. Mobile banking is convenient and consumers have a growing number of options for transactions on the go, but every transaction brings a real identity theft risk. Even though companies are pouring money into ways to make mobile payments mainstream, the continued rise of smartphone-related identity theft may curb adopting this type of transaction unless companies can prove their mobile systems are secure. |
|
|
|
|
Mobile payment system Isis is ramping up its efforts and signing partners left and right, but rising to the top of a crowded field may not come easy.
Fifty vendors partnered with Isis in preparation for its upcoming trials in Salt Lake City and Austin. Isis snagged big vendors like Coca-Cola and Macy's, suggesting retailers have some degree of confidence in the mobile payment system, which is a joint venture from AT&T, T-Mobile and Verizon. Isis scored a win by signing up a wide coterie of vendors for its trial cities, which includes a pilot program for commuter use on Utah's public transit system, but the mobile payment field is growing increasingly crowded. Isis faces competition from other NFC-based mobile payment technologies like Google Wallet, although the search giant's mobile wallet is not catching on quickly. More pressingly, Isis will face off against Square and PayPal, two alternative mobile payment systems bolstered by their ease of use and name recognition. PayPal is already a popular online payment service, and its trial run in Home Depot and expansion into stores illustrates the eBay-owned company wants to dominate mobile payment as well. For its part, Square's simple payment system received a stamp of approval from the Obama campaign's fundraising staff, and it may appeal to people who do not want to buy a phone outfitted with NFC -- although most popular smartphones will have the technology in the near future. Isis is off to a late start, but its decision to focus on a powerful alliance of businesses puts power behind it, and its affiliation with major credit card companies may boost consumer confidence in the service. The big names behind Isis may win over customers wary of mobile payment systems in general. Moreover, with big box stores like Target and Wal-Mart installing NFC technology in anticipation of e-wallets, the wide array of partnerships Isis enjoys will make using the system convenient for consumers. Isis recently teamed up with merchants to improve its point-of-sale services and further smooth out operations, so it may attract customers with unprecedented ease of use. With Apple contemplating its own NFC payment system, Isis will have to work extra hard to stand apart from its competition to emerge on top in the mobile payment race. Isis sounds good in theory, but the trials in Salt Lake City and Austin will put the idea to the test and gauge consumer interest. Getting big stores on board was a clever step, but making sure people find the system more appealing and secure than Square, PayPal or other emerging programs will be a bigger challenge. |
|
|
|
|
Virtual grocery stores won customers over in Philadelphia and Seoul, but the newest Chicago iteration has yet to catch on with commuters.
Online grocer Peapod is test-driving a program in Chicago, allowing subway commuters to shop at a virtual store with their smartphones. The walls have pictures representing items like bananas and milk, and users can download an app to scan the items they want, which Peapod delivers to their homes shortly afterwards. Peapod unveiled a similar store on multiple train platforms in Philadelphia, and reported a bump in mobile orders. A similar bump in mobile orders may not happen in Chicago. The virtual store, in the northeast tunnel at the city's State and Lake red line station, is in an inconvenient spot outside of the area where people wait for trains. Commuters eager to catch a ride cannot use the virtual store without risking missing the train, because it is not within the ticketed area. Over a four-hour period a few days after it launched, no one walking through the subway tunnel used the program, or even considered using the program. Most people ignored the store or looked at it with mild interest before continuing on their way. Keith Brown, 41, noticed it only after it was pointed out, and said his mother often used Peapod. "She is way too old to come to the subway, though, so she wouldn't use this," he noted. "I like the idea, and I'm comfortable with mobile payments in general, but I don't feel like I need this," Chicagoan commuter Amie Kesler, 27, explained. Dan Thorpe, 24, echoed Kesler's sentiments, saying "I have a grocery store around the corner, and I'm going to stick with that," but he was enthusiastic about this project's potential. Why did virtual shopping find more success in the subway stations of Seoul and Philadelphia? It's simple: location and exposure. In Seoul, Tesco's Home Plus tested virtual stores inside the waiting area for trains, meaning commuters could browse while waiting for an incoming train. Home Plus is the second-most popular grocery store in Korea, so everyone was familiar with the store's products, and Home Plus rolled out virtual stores throughout Seoul, including locations at bus stops. While South Korea's virtual store has a some differences with Chicago's version, Peapod's based its virtual stores in Philadelphia on similar concepts, just a different city. Peapod reported a boost in online sales in Philadelphia, but the reception in Chicago is chilly thus far, even though the Windy City has more product options. One main difference between the two locations is Philadelphia's virtual stores are in the area where commuters wait for a train, whereas Chicago's store is in a tunnel leading into and out of the subway station. Because commuters are still rushing to their destination, they are not as likely to take a moment and look at the virtual store, let alone order groceries from it. The experiment in Chicago underscores potential difficulties for mobile-based shopping. It is not enough to compete on the novelty and convenience of purchasing goods and services via smartphone: businesses hoping to boost sales through mobile payment methods must still think strategically about audiences, placement, marketing and differentiation. In other words, services like Peapod's must meet consumers where they already are, rather than hope to change their lifestyle and daily routines. If Peapod wants a successful Chicago test run, it should consider changing its virtual store's location to make it more convenient for shoppers. Even though people are growing comfortable with the concept of mobile payments and smartphone shopping, companies looking to expand in this area will not see significant growth unless they make the experience preferable to the other alternatives. |
|
|
|
|
Barnes & Noble is revolutionizing e-readers by adding mobile payment technology to its Nook, through a partnership with Microsoft to challenge rivals Apple and Amazon.
Big Plans For Mobile Payments and Microsoft The bookseller is adding NFC technology to the Nook, and plans to integrate mobile payments with its in-store browsing experience. "You can walk up to any of our pictures, any of our aisles, any of our bestseller lists, and just touch the book, and get information on that physical book on your Nook and have some frictionless purchase experience. That's coming, and we could lead in that area," CEO William Lynch told Fortune, highlighting how the company plans to wield NFC to give it a leg up on competitors without in-store components. Barnes & Noble's foray into NFC will help the Nook stand out from other e-readers, and its partnership with Microsoft is fostering deep integration, which will further boost the Nook's credentials. Lynch discussed the potential for running the Nook on Windows 8 instead of Android, which would be a huge boon for Microsoft and give the e-reader a distinguishing characteristic. Windows 8 is set to connect mobile devices with laptops and computers, and connecting an e-reader to the wider Microsoft ecosystem opens up possibilities for the Nook to take advantage of. Lynch, for example, envisioned integration with Microsoft's Office suite and other publishing tools, so authors could put materials composed through Microsoft directly to the Nook. Apple already does this with iBook Author, but Office is the most-used word processor, so the Nook will have a big advantage in luring authors. Moreover, the controversy surrounding Apple's publishing deals may further push writers into Barnes & Noble's arms. ... But Rivals Won't Take This Lying Down The Nook will have formidable competition no matter how well it innovates. Apple may lose authors if Barnes & Noble incorporates Microsoft's publishing tools, but the iPad is still the premiere tablet, and other companies are also striving to make revolutionary changes to e-publishing, like LG with its upcoming flexible, paper-like e-reader. Amazon's Kindle sales are still brisk, and the company is testing an app purchasing system, looking to recruit the best app developers. Also, one of Microsoft's problems with its OS is its lack of apps, so Barnes & Noble may need to figure out a way to compensate or risk losing business. The Bottom Line Barnes & Noble's embrace of NFC shows the company is looking for ways to stand out, but it may run into problems convincing customers to adopt the technology, as research shows buyers are less enthusiastic about mobile purchasing than the retailers implementing it. No matter how cutting-edge the NFC debut looks, unless customers are open to using it -- and unless there is enough content and apps to take advantage of it -- the benefits will be negligible. Barnes & Noble's recent ventures with Microsoft and NFC may give the company a boost, but it has to convince customers to use NFC technology and prove Windows' worth as a mobile OS to sway consumers. The publishing advantages Barnes & Noble's integration with Office are likely to attract authors, but it may take time to reap the benefits from other customers. |
|
|
|
|
Pay Anywhere slashed prices to attract small businesses away from rival mobile payment systems, as it tries to strengthen its presence in a young and growing market. Pay Anywhere made the move to undercut Square, PayPal and Google Wallet by just one cent, charging merchants $2.69 per $100 processed, compared to rival fees at $2.70. Before, the company charged business owners an additional 19-cent flat fee per transaction and sold the mobile credit-card readers it now offers for free. Pay Anywhere's decision to lower prices will likely attract more merchants, possibly boosting its chance at becoming a bigger player in the growing mobile payment market. The policy joins the Pay Anywhere app, backed by North American Bancard, which launched last year. So far the app has seen only 100,000 downloads. By comparison, Square aims to process $2 billion in daily payments this year and PayPal boasts over $10 million in transactions per day. Google Wallet also maintains a strong presence and the Isis consortium of credit card companies, manufacturers and carriers may prove a formidable force in the mobile payment field. Lower prices may aid Pay Anywhere's growth against these giants, but the company will need to lure merchants with more than just low prices if it hopes to stay competitive. Square has angled for merchants by selling its credit card reader at major retailers like Apple and Wal-Mart and creating a customer loyalty system to encourage repeat small business customers. The company has also lowered monthly fees and is now marketing a new cash register. "PayPal Here," the company's new mobile credit card-reader, now surpasses Square's original dongle by locking securely into place on users' phones. PayPal is also moving to attract major retailers in addition to smaller businesses, broadening its customer market in a move to counter Square. Google Wallet, meanwhile, experienced growth after teaming up with Verizon in a mutually beneficial deal to install its NFC payment program on the carrier's phones last December. And retailers like Starbucks enjoyed extra business when Google Wallet offered new customers a $10 credit at select West Coast coffee houses. Given its rivals' efforts to lure merchants, Pay Anywhere will need to work hard at attracting businesses to stay afloat the mobile payment market. But even Square, Google Wallet and others may need to improve security before experiencing truly broad adoption. Google's mishap with a security glitch this February, as well as PayPal's past difficulties, suggest merchants and users are understandably wary about entrusting their financial affairs to mobile payment systems. If Pay Anywhere manages to allay merchants' security fears in addition to attracting them with low prices, the company stands a good chance of success even against established rivals. |
|
|
|
|
PayPal introduced its new small business mobile payment system, rivaling Square and staking its place in a still-developing industry. The thumb-sized credit card reader, dubbed "PayPal Here," plugs into a smartphone headphone jack for swiping credit cards. With a multi-purpose interface, the program allows retailers to track check or cash payments. PayPal Here's release has major implications for the mobile payment industry, which is struggling to find a solid foothold among consumers and merchants. Without using near-field communications, or NFC, technology in its device, PayPal Here directly competes with credit card reader Square, and both tout themselves as an option for small businesses. NFC-based mobile payment systems, like Isis and an impending release from big-box retailers, work with credit card companies as a top-down strategy. PayPal's strategy draws upon an existing global customer base from the eBay-owned PayPal online checkout system, bringing familiarity that could attract retailers. With name recognition on its side, the device is already available in the U.S., Canada, Australia and Hong Kong. The blue triangle-shaped device plugs into the headphone jack with a piece that slides down to lock into place, unlike Square, which attaches to a mobile device only through the jack. Also, users who may not have the card reader handy can still use the program to snap a picture of a card instead. Looking for any other edge, PayPal Here also has slightly cheaper fee, charging 2.7 percent of a transaction for credit use and 1.7 percent for debit use, versus Square's 2.75 percent. Should PayPal Here take off, it could help boost the mobile payment industry overall, but widespread adoption won't come easily in a sea of competitors. Square is stepping up its own game to corner the non-NFC mobile payment market with the launch of Square Register, which can accept cash check or card and expands Square's use for point-of-sale operations. And, in the face of increasing competition, last year Square lowered its prices. PayPal isn't the only tech company to try to gain traction in the mobile payment market. Google Wallet launched last fall, but it's yet to catch widespread adoption, though Google is using the payment system for Android app developers. But NFC-based systems, which are different from PayPal and Square in requiring added technology, are making their own inroads. Isis is partnering with merchants to widen its service, ShopKeep created a system to transform iPads into cash registers, and a coalition of big-time retailers aims to get in on the market. However, not many phones are yet equipped with NFC chips, which may slow efforts based on the technology. If retailers, large or small, want to offer the most convenient customer sale operation they can, they're likely to look to mobile card-swipe devices as a key to the future. But with so many players out there and a lack of a clear frontrunner, the retail industry is just starting to see a system take hold. |
|
|
|
|
PayPal is intensifying its battle with Square, as the company prepares to launch a credit-card reading device and competes with the larger NFC-based mobile payment contenders. PayPal plans to expand into physical stores with a credit-card reading dongle, similar to those used by Square, Intuit's GoPayment and Verifone's PAYware. According to reports, the device processes payments without expensive or heavy hardware, and is triangular, a possible dig at Square, PayPal's main rival. Square just released Square Register, a check-out app aimed at small businesses, and PayPal's dongle indicates it aims to target the same corner of the mobile payment market. PayPal already launched one part of its in-store expansion plan, integrating its software into Home Depot's registers so customers with PayPal accounts use them at checkout. The in-store software plan targets large retailers willing to overhaul their point-of-sales system to include PayPal. PayPal's dongle, however, may attract smaller businesses and those reluctant to revamp their whole checkout system. Square and PayPal are battling it out, but both companies face increasingly stiff competition from mobile payment systems based on near-field communications, or NFC, technology. The upcoming Isis coalition is targeting businesses, merchants and consumers in a big push for NFC adoption on phones and in stores, which will likely bring mobile payments on a broad scale to the U.S. marketplace. PayPal initially dismissed NFC technology as inconvenient, but the threat is mounting. Isis is ramping up security and gradually establishing a powerful coalition of backers, and more phones will land in the marketplace offering NFC capabilities. As NFC grows more accessible, it threatens both PayPal and Square. PayPal enjoys a large user base, but the company faces stiffer competition bringing its payment system onto mobile devices and into stores, especially as Isis prepares its debut. The dongle may ramp up competition with Square and garner small business support, but PayPal has a long way to go in its quest for mobile payment dominance. |
|
|
|
|
Apple has patented a payment system based on near-field communications technology, hinting at mobile payments on iPhones in the future and giving NFC a boost in the burgeoning digital wallet market. The Cupertino, Calif-based company's new patent covers a system designed to help parents control what their children spend by allowing credit card companies to send statements to iTunes. Patenting does not always mean Apple immediately implements the technology, as the company sometimes speculatively collects patents without using them. The company has explored a number of NFC-related patents in the past, gettings its first NFC-related patent last November, but the detailed plans for this particular patent show how Apple wants to use the technology. Apple's interest gives emerging NFC technology a boost by putting it directly on its top-selling iPhone, underscoring NFC's increasing viability for digital wallet initiatives as other mobile payment systems jockey for space among the competition. NFC enjoys support from a number of banks, credit card companies and carriers involved with the forthcoming Isis mobile payments initiative, but critics maintain only a limited number of handsets come equipped with NFC, and say merchants are hesitant to add the technology. Simplified app-based mobile registers that don't rely on NFC, like Square Register, are gaining traction with small businesses, and NFC-centered efforts faces stiff competition from Square and PayPal, as these rival systems insist they are easier to use. Apple's patent filing shows NFC, which has strong financial industry backing, is catching on with smartphone makers. And as iPhones stay at the forefront of innovation, other handsets are likely to follow and install the technology if Apple uses it. NFC technology already made important strides before this development. Moneto, a service bringing NFC technology to any smartphone, made it easier to access the technology. Despite signs of progress, NFC payment systems aren't without problems. For example, NFC-based Google Wallet has serious glitches, casting doubt on the system's security. Isis and other NFC-based systems are taking extra security measures, but customers prioritizing security may lean towards other payment systems after that snafu. NFC is gaining steam, but the mobile payment race is far from decided. Apple plans to support NFC, but it already works with Square and PayPal. Apple is likely hedging its bets and getting involved with all the potential mobile payment frontrunners so its users will be covered, regardless of which system gains widespread adoption. |
|
|
|
|
Square is launching Square Register, a new iPad app intended to replace traditional store registers, indicating the start-up is expanding its hold over the mobile payment market. Square Register modernizes point-of-sale transactions, offering a simple mobile payment processor capable of accepting cash, credit or checks. Square is marketing the Register app towards smaller businesses, hoping to build a stronghold in the mom-and-pop sector. The San Francisco-based startup processes over $4 billion in payments yearly, making it a leader in the growing mobile payment field. The company credits ease of use with its growing popularity. Square's apps have several functions that are tailored toward small businesses, including a free analytics program that helps owners track inventory and determine optimal store hours and employee numbers. "This would be ideal for food carts, small coffee shops or bike stores," says consultant Trip Hosley, referring to Square Register's attributes. The company is attempting to distinguish itself amid growing competition, etching out a distinctive corner of the market and focusing on small businesses. As big-box stores like Wal-Mart and Target develop their own mobile payment systems based on near-field communication, or NFC, technology, the start-up is instead focusing on an array of small businesses without access to NFC. Square's dongle-based payment system also found favor with the Obama Administration, as campaigners adopted the mobile payment system to accept donations. Square also enjoys high-profile admiration from Sir Richard Branson, the Virgin entrepreneur, who invested heavily in the company. Nevertheless, Square faces fierce competition, and advances in NFC technology may help rivals like Isis, which recently announced partnerships with major merchant payment companies like Verifone. Besides its NFC rivals, Square Register will also compete with mobile payment software from ShopKeep, which operates off the iPad and targets smaller businesses. Similarities between the two products will make it more difficult for Square Register to gain footing as a unique product. Square's app will also contend with PayPal, another non-NFC mobile payment system intent on invading brick-and-mortar stores and overtaking the competition, leaning on its strong user base to help eke out a place in the market. Square Register may be a strong product with good prospects, but the mobile payment race is far from decided. Square's competitors offer equally attractive systems, so the company looks to carve its niche in the small business market. |
|
|
|
|
|
|
|
|
Tags: