ABI Research Reduces NFC Forecast for Mobile Payments
In a press release, ABI Research has announced a new report titled "Mobile Commerce and Payments" concluding that NFC (Near Field Communication), once the leading contender among technologies that could enable mobile payments, "has developed more slowly than anticipated, and will not offer viable large-scale mobile payment solutions for at least six years. In the mean time three existing technologies - SMS, mobile Internet and downloadable mobile applications - have the potential to deliver what NFC (so far) cannot."
"About half of all purchases made by consumers last year were made with cash," notes ABI Research senior analyst Mark Beccue. "Consumers would in many cases prefer cashless transactions when away from home. So around the world solutions providers have leveraged SMS, mobile Internet and downloadable mobile applications to enable mobile commerce and payments. ABI Research calculates the potential revenue in 2013 from mobile transactions using these methods at about $18 billion: a significant opportunity for payment processors."
A new ABI Research study examines the potential for mobile payments in four key vertical markets that will drive adoption: taxis, parking, movies, and Internet shopping. While the latter is usually done using credit cards anyway, the first three are areas in which mobile payments could replace cash transactions. The research found that Internet shopping would account for almost three quarters of this mobile commerce revenue in 2013. A further 15% would come from parking, with the balance split about evenly between taxi fares and movie tickets.
Beccue concludes, "Companies already seizing this mobile payment opportunity include parking solutions provider Verrus, Bharti Airtel and movie theater operators in India, and notably eBay and Amazon - the world's largest e-commerce merchants - which have enthusiastically embraced mobile transactions with very comprehensive offerings."
This might be news in North America but text messaging enabled, closed loop, server based mobile transaction systems have been around for atleast eight years in Asia.
Proximity and remote payments are two different segments and neither contactless for proximity payments nor text and mobile internet for remote payments will fit across the other segment. Try using a text based 'account-on-server' solution for a transportation fare collection application.
In fact text messaging, mobile internet and downloadable applications are also used by mobile contactless systems for proximity payments.
The 'potential' for remote transactions should not be confused with the 'potential' for face-to-face, over the counter transactions.
The research report suggests NFC is competing with, and is an alternative to remote mobile transactions. It is not.
Posted by: | December 26, 2008 at 11:12 AM