Mobile Movements

So... the mobile hysteria keeps moving forward. I keep reading all these differing accounts about the potential mobile revenue that can be generated (whether it be from banking or payments), and now that the media has accepted this mobile medium a bit more, there's a huge amount of discrepancy between the viewpoints. There's one camp that keeps releasing "news stories" that say things like "mobile banking hitting the tipping point!"..."Cash On Its Deathbed!"...but they release them....every week. Nevertheless...Finextra estimated that there were over 4.6 billion mobile payments made in 2010 (and KPMG found through a survey that people believe mobile payments will be mainstream by 2014), and the big players are definitely marching forward to capitalize on that!

• Google Wallet finally launched to mixed reviews. (This is actually a real thing, contrary to the hysteria over Google getting into the credit card business earlier this year.) The pros seem to be that they've gotten a lot of huge merchants to sign up (Macy's, American Eagle, Jamba Juice, etc.) but currently their functionality is only rolled out to one phone and (probably because of the newness) is still causing a lot of confusion at point of sale. I had the opportunity to see it in action at the Macy's in Chicago at Water Tower, and it went something like this:

1. Customer goes up to counter with product. Notices reader
2. Customer fumbles around in (overly) gigantic purse, finds phone. Presents phone to cashier
3. Cashier looks confused, which results in a great moment where customer and sales person just blankly stare at each other (reminiscent of what I would imagine it was like when humans first tried to use the wheel--stare at device, stare at phone, stare at device, stare at each other, shift weight from foot to foot awkwardly)
4. Cashier realizes its a tapping thing...awkwardly pats the terminal
5. Customer initializes app. Tries to tap. Taps too fast. Terminal declines. Taps again, too slow. Terminal doesn't register. Taps again. Some error occurs
6. Cashier takes phone and tries to tap. Transaction goes through
7. Cashier and customer awkwardly laugh it off and customer is on their way

Yup. Sounds way faster. It's the wave of the future people! ...and the future is awkward and confused.

• PayPal is hanging tough in the game by releasing their plans for mobility--which spans beyond mobile payments and is focused more on in-aisle check out, ways to perform "mobile shopping" and other merchant capabilities
• ISIS....well...ISIS is still being ISIS. Originally started as mobile payment platform, its evolved to be essentially a white label solution for banks to develop mobile capabilities. It did announce some firm commitments though by partnering with some security companies (again the security issue we keep seeing popping up every where). I know that a lot of people have given ISIS a lot of grief, but the fact still stands it is the closest thing we currently have to a truly collaborative business model that offers a comprehensive mobile payment solution (issuer, bank, merchants, network, etc.). Can't hate 'em for trying...
• Visa is planning to kill two birds with one stone by integrating EMV (regulatory requirement) chips and mobile payment chips by accelerating their roll out of chip technology in the U.S. This is actually an ingenious strategy because saying "this chip is for compliance and security" is easier to sell than to say "this chip is for mobile payments which you're not sure you want to use due to security reasons any way". Overall, a strong move

There have also been some interesting partnerships:

• First Data (the largest processors in the industry) chose VeriFone to focus on the security of mobile payments (consistently ranked as the top concern of customers and merchants alike). This would enable VeriFone's PAYWare Mobile to enable secure mobile payment options. FirstData get a new product to increase their revenue from trxn fees, VeriFone gets an increased distribution network and increased sales in its product
• Motorola threw some pretty extensive funding behind Vivotech ($24 Million!). This is mostly interesting to me because Google just purchased Motorola, and in doing so acquired a ton of patents, a experienced workforce (they laid off 800 employees though) and a bunch of new, interesting functionalities that include mobile security software. In doing so, Google has really set itself up to take over the end-to-end value chain of mobile payments from hardware to payment process to merchants. Props. (Some claim though that Google still has more than enough competition coming from other alternative players like Facebook though)
• Verizon is countering with their partnerships too..they recently announced that they would partner with American Express' Serve, which would allow customers to buy things by typing in their phone number into their phone (which doubles as an authentication feature)

Phew. Glad I got that out of my system. I feel better now, don't you?