Others in MoMo pointing fingers at Mobile Commerce

Thanks to Ged, I picked up on the MoMo Global post about Jupiter's report on too many initiatives in mobile payments are slowing development - will have to send this to GSMA and see if they agree that!

Yesterday the Sunday Times had a feature on how GSMA and Mastercard were going to bring credit cards to the phone by this time next year! As I said last week I don't think so. Catching up at the London MoMo event this month with some who have been working on mobile payments for the last few years they said that the depressing thing is that the US are driving a number of trials that failed in Europe FIVE years ago.

I believe that payment services are key to the mobile industries long term growth. In South Africa they launch of M-Cash on the MTN network has seen a shift socially with an underclass now able to access banking services as well as payment of welfare services. In Europe I see M-Payment as something that could move the customer base from prepaid to postpaid services. Such a transition would be allow the networks to control costs, in the UK £4Billion is sent each year by networks on SAC. It could also mean that if we are to progress down the NFC route are handset can become much more than phone. What about using the handset as a key for example, such a development could see me gain access to my house, start my car and enter offices.

Nokia and others try another M-Wallet push

Reuters reports that Nokia, Mastercard and GSMA have released a few more details on the trial that they plan for October!

The technology used is yet to be outlined in detail; as well as Nokia, Samsung and LG have signed up along with a number of tier two networks. No sign that this is something that as yet has the backing of those who failed with SIMPAY.

This looks like fluff to me! The mobile commerce trails that have become products are based on the replacement of paper money rather than the expansion of electronic cards. When I travel to mainland Europe the locals are still big users of Paper Money it is only here in the UK and in the US where you find people trying to pay for a coffee with a card!

Whilst I agree that some form of mobile payment system will evolve I think that it will be as a form of replacement to paper and coins and not an adjunct to cards. I would like to be able to ring fence a funds that I give my twins when they start traveling to school on their own so that it can only be used for transit systems, school food purchases and say WH Smiths as well as airtime on their phones. I do not want to discover that they have had the phone taken off them by someone on the bus who has then used the credit to buy Vodka and Fags!

Thus what I see as mass adoption of M-Payments will be for micro payments i.e. those of less than £10 and the fees for these need to be lower than the current charges made by Mastercard and Visa. Not sure if this is news, could just be a slow day for Reuters!

Telebusillis calls it like it is

Kieth has turned his analytical brain to the fallacy of mobile VoIP with the excellent post on now Truphone might be good a PR but they are not great at forming a business plan. As with my post yesterday about how the Dragon got it wrong Truphone does not compare like with like.

SKYPE no longer say that they are a VoIP play they say that they are a Messaging platform. Vonage have discovered that their business plan is flawed. Look at the number of me to services for VoIP that have closed the shop when it comes to consumer VoIP. Truphone should no better because of their history with Gosiptel.

The likes of Orange do not see VoIP as a threat, they look at the service and say at present it is not fit for purpose. They also like the fact that just such a service allows them to demonstrate where the value sits in the current customer proposition.

Before anyone moves toward a new service based on VoIP we first need to get the user based off prepaid and onto post paid. This is something that I just don't see happening too soon as it would result in the Networks having to reduce the current subscriber numbers to reflect the real numbers.

Dragon Flames the MNOs....

The Comment section of today's Financial Times carries a story by Doug Richards once of Dragons Den on the BBC in which he set about explaining that we will soon see the likes of Vodafone, Orange and T-Mobile consigned to the History Books. Mr Richards explains that thanks to being overcharged we will soon dump these international networks and start using free VoIP.

Now rather than deconstruct Mr Richards opinion I have decided to take an approach similar to that used by the Dragons on the TV programme.

1. Mr Richards lets first look at the fact that the majority of the users on Mobile Networks in the UK are not price sensitive, if they were then they would have dumped Prepaid for one of the contract tariffs that give away so much value.
2. How technology savvy will my mother have to be to use such a service; having been a tester on the BT Bluephone project using a mobile that roams from hotspot to hotspot at present takes a fair degree of technical skills to maintain a database of profiles and switch to the right one?
3. As most users buy a handset on the basis of its features, how do you propose to overcome the issues of battery life when running WiFi?
4. How often have you dropped a call using SKYPE and do you think that it would be acceptable when you add the complexity of movement?

Look it is a nice idea but look inside the average persons wallet and you will see that they have more than one payment card. You do not need more than one credit card but you take as many as you are offered you do not dump the bank because it has ripped you off with its charges you keep using it. True some are starting to fight back and ask that the overcharging stop and the money that was taken be returned to them but very few are doing so. The retail banking industry is a lot older than the mobile phone business and it has taken a lot longer for the customers to start to complain, I can see Vodafone and Orange being around for a good few years. I for one would happily pay a fee for customer service and no adverts.

The nightmare that you paint could see my daughter having to watch an advert for McDonalds and Starbucks before having enough credit to phone NHS Direct for Obesity advice ;-).

I have heard enough and I am out!

3rd Party Marketing starts to get kicked in to touch.

Catching up on the Sunday Papers and I see that someone at the Sunday Times also hates the bombardment of "Update Calls" on their Mobile.

The Good News is that it seems that the Mobile Networks have woken up to the fact that such actions upset the Customers and have started to take action! The story explains that the big three networks have started to attack those agencies that have set up call centres that are aimed at getting customers to upgrade/churn.

I guess this is one good point, would also have been excellent to see that having done so the Networks then put out a Press Releas to the effect that Company X just got canned by us because they are scumbags and not only do we not want anything to do with them we are taking them to court for missrepresentation. That way I would not have so many friends and family complaining that they have been stung by such cowboys.

It seems that Orange have got a grip over the past few weeks as I have not had as many calls as I was getting at the start of the year. I just wish that they did some form of outbound marketing that said that it was a scam in the first place and we would not have seen the thing mushroom to the extent that at one stage I was getting over twenty calls a day offering me a new handset when I upgraded.

Did Orange just hit the panic button?

Today's Observer has a short articles on how the new two year contract is not a good deal.  They say that at the end of the term the consumer has a redundant handset!

Welcome to the Corporate World!


I am sure that by the end of the Summer all of the other networks will be pushing the same two year deals over the present eighteen month deals.  In such a move the Consumer will be educated as to the real costs of telecoms, if we are still to get £500 handset then we will have to used to paying £35 for a few more months than we are at present  or commit to a bigger monthly fee.  Along with the SIM only deals that will allow consumers to see where the costs sit at present for the Networks I think that by the end of this year we will see a change in the perceptions of the mobile consumer.

We are just going to have to get used to paying for our handset in some form! 

Others re picking up on the Voice thing!

Catching up after a busy few days and I find that Om has been having a rant about poor voice quality in mobile!

Loved the opening:

"In 2006, voice brought in about $110 billion, and that is such a large amount of money that the U.S. wireless providers should cringe at the fact that they have to use advertising tag lines such as “fewest dropped calls” or ask people to come and try their service for 30 days or switch back for free.

No self-respecting descendant of Ma Bell should be able to sleep at night till they fix the voice network. After all Europeans have managed to lick the dropped call problem, by putting decent enough quality in place. Even the Chinese and Indian carriers with their microscopic ARPU manage to complete calls pretty much everywhere."

Just hope that the guys at the top of the mobile networks are reading the same blogs as I am.

I think that we will see a change in behaviour over the coming months. Talking with contacts in the Network, Handset and Distribution businesses it does see that they have realised that the present business model is broken and it is time for a new one. Hopefully this will result in an increase in work for all at the Wireless Foundry!