Here are a few stories that caught my eye in the commerce space this week.
The blossoming NFC ecosystem
One of the holdups to NFC mobile payments, especially in the U.S., is the lack of ubiquity in the technology. This, it seems, is about to change. Last week, Microsoft announced its Windows Phone 8, which includes NFC complete with Wallet Hub, will arrive this fall (The Verge has a nice analysis of the new features and larger plans that may be in store for the phone’s NFC use).
This week, 9to5Mac uncovered compelling evidence that the next generation iPhone will include NFC. 9to5Mac writer Seth Weintraub reports that they had “previously been able to pull data from PreEVT iPhone 5,1 and iPhone 5,2 prototypes” but that they’d forgotten one thing: “Further investigation into this hardware code dump leads us to believe that these iPhones also have Near Field Communication controllers directly connected to the Power Management Unit.”
Christina Bonnington at Wired took a look at some possibilities for NFC technologies in iPhones, given Apple’s WWDC announcement of Passbook coming in iOS 6. She notes that Passbook isn’t set up to process payments but points out that NFC could change that:
“In its announced iteration, Passbook would let you load up your Starbucks card with money, for example, and then let you pay for items with barcodes displayed on the iPhone’s screen. But NFC could let you pay for that grande macchiato even more easily with just a tap of your iPhone. With Passbook, that tap could also account for any coupons or discounts you’ve collected. Payments could also be tied with your iTunes account through iOS.”
If rumors hold true, the new iPhone should appear some time this fall. Add in the iPhone and Windows Phone 8 to the list of current and expected phones to include NFC and perhaps NFC mobile wallets will get the ecosystem they need to get off the ground.
NFC considerations and preparations
It looks as though NFC technology is simmering its way to a boil, and a couple stories this week presented particularly prudent points of consideration given that likelihood. First, Kendra Srivastava at Mobiledia reported on a malware “paycardreader” app designed to allow thieves to “skim the card numbers and dates, along with transactions and merchant IDs” from NFC-enabled phones. The app was built by security researcher Thomas Skora, who presented it at Integralis Security World 12 in Germany as a warning to the dangers of mobile banking. As a demonstration, the app hacked an NFC-based PayPass Mastercard at the show. Srivastava reports:
“Skora insists the app is meant ‘only for technical demonstration.’ … Google promptly removed the paycardreader from its Play store, but the source code is now widely available on open-source code provider GitHub.”
Another story reminded readers that NFC technology has the potential to disrupt more than just payment sectors — it has the potential to reach across industries at fast clip, and businesses should be prepared. Derek du Preez at Computerworld UK reported that SITA chief technology officer Jim Peters told attendees at the Air Transport IT Summit in Brussels “they need to be prepared for the proliferation of near field communications (NFC) technology …” Peters said at the summit that “[b]oarding passes are going to be the next step with this technology” and that the industry “need[s] to get ready, this is coming. … By the end of the year the majority of smartphones that you go and buy will have NFC on them.”
The mobile commerce revolution reaches Thin Mints and Tagalongs
A white paper (PDF) recently released by TNS Global declared that mobile commerce was at its tipping point. The report says mobile banking and mobile wallet services are getting ready to “surge worldwide” as consumers look past security concerns and opt for convenience. Citing The Mobile Life 2012 study, also being conducted by TNS Global, the report states that 50% of the phone owners worldwide are either using mobile banking or are interested in it and that 45% “show the same level of enthusiasm for making payments using their phone.”
The trends indicated by the study appear to be playing out in practice. John Milliken, managing director of Mobile Money Network, wrote at The Guardian this week that mobile devices are causing a “revolution” in the retail industry “on a par with the introduction of plastic payments in the 1950s or the launch of the internet and e-commerce in the early 1990s.” Milliken says mobile represents “a fundamental shift in consumer behaviour and retailers have a unique opportunity to move quickly and take advantage of the true power of mobile.”
Chantal Tode at Mobile Commerce Weekly also took a look at the effects of mobile and how they’re transforming in-store shopping. She writes that the much discussed practice of “showrooming” is just the tip of the iceberg, that “mobile in-store engagements at scale are coming.” Tode points to Target’s recent nationwide rollout with Shopkick and says that mobile can be used to drive in-store sales, “which is why it is imperative for merchants to have an integrated mobile commerce site.”
If there’s any question as to how mobile is affecting the retail and payment spaces, one needs to look no further than the Girl Scout cookie drive. In a separate post this week at Mobile Commerce Daily, Tode reports that 30 Girl Scout councils partnered this year with a mobile payments company to enable the troops to accept credit card payments via swipe machines on mobile phones. The ability to accept mobile cookie payments resulted in nearly quadruple the sales year over year.
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