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Contactless Payments Will Top $320 Billion by 2016, Says Report

February 8, 2011 by Mobile Payment Magazine

Internet, mobile and contactless payments are expected to continue to grow, and will more than double to over $200 billion by 2016, according to a recent report.

The Advanced Payments Report 2011, sponsored by MasterCard Worldwide, is based on a review of the global payments landscape, surveys of payment industry stakeholder opinion, and discussions with more than 650 industry executives and thought leaders.

The report states that, on a worldwide basis, the greatest growth in payments over the next five years will come in “advanced payments” – online, contactless card and mobile payments. It estimates that the global market size for internet or online payments will continue to grow and is expected to more than double to over $2000 billion by 2016.

But the greatest growth will come in mobile and contactless payments. The global market for mobile payments is expected to reach $680 billion by 2016, with that for contactless payments estimated to exceed $320 billion.

“Payments Cards and Mobile has been reporting on the global growth in Advanced Payments for a number of years now,” says Alex Rolfe, Managing Director, Payments Cards and Mobile. “This report validates the continuing emergence and success of new market entrants and the changing nature of the payments infrastructure.”

Of all the drivers for success, “executive commitment is perhaps the most powerful driver for pushing out a new payment product,” the report says. It adds that while many organisations undertake limited, partially funded and often half-hearted trials of new payment products, the really important element missing in many such initiatives is executive commitment and the allocation of the right levels of investment.

The stakeholder opinion survey identifies payment cards as the most important payment method for making payments online but recognises the need to allay customer concerns of potential security risks. For contactless payments, the report notes that lack of contactless point-of-sale (POS) terminal infrastructure is the most critical challenge to growth in payment volumes.

On mobile payments, the survey points to the general lack of cooperation between the banks and the mobile network operators (MNO) as a continuing issue that needs to be addressed. It also notes that both banks and MNOs must address the needs of consumers as well as merchants and design suitable incentives where necessary.

Samee Zafar, Director at Edgar Dunn & Company (EDC), producer of the report, said “Robust and secure mobile payment technologies are widely available. These can leverage existing payments infrastructure as far as possible thereby saving payment processing costs. What is now required is for payment services providers to develop advanced payment products that can be effective and successful in the marketplace.”

Source: PR Log

Filed Under: Research Tagged With: 2011 Advanced Payment Report, Edgar Dunn & Company

NFC Technology in Smartphones Spurs Commercial Vialbility of Mobile Payments

January 31, 2011 by Mobile Payment Magazine

The near field communication (NFC) market has moved from an ‘innovator’ to an ‘early adopter’ phase and from trial development to the first commercial roll out.

The key driver for the market is the wide adoption of the NFC solution in mobile phones, as without massive number of NFC-enabled mobile phones in use, the market will not be able to realize its immense potential.

According to industry analysts at Frost & Sullivan, NFC-enabled mobile phones will reach 863 million units in 2015. At this time, NFC-enabled mobile phones will represent more than 53 per cent of the overall market.

A recent report from the company entitled :NFC: When Will Be the Real Start?” states that in 2015, NFC will clearly be the most-used solution for mobile payment, and analysts expect that the total payment value for NFC globally to reach approximately $180 billion in 2015, while the NFC payment value in the EU is expected to reach $67.55 billion.

Frost & Sullivan forecasts a five-year compound annual growth rate (CAGR) of 118 per cent between 2010 and 2015.

“There are two possible business models for the NFC market; the first one is based on a memory rental model where the NFC application will rent the memory space used by its application and the second is a pure rental model coupled with extra cost per use where the application will pay a cost per year with a given number of actions,” explains Frost & Sullivan Global Program Director Jean-Noël Georges. “When this number of actions on the application such as update, patch, read and write is reached, extra costs are charged to the application provider.” Frost & Sullivan anticipates the second model to be the most applicable. The pure rental model will probably be the most widely used in future.

“Different secure elements for NFC methods have allowed different technology players in industries such as telecoms operators and electronic device manufacturers to establish their own payment infrastructure,” remarks Jean-Noël Georges. “This lack of harmonization has been an obvious restraint for the NFC industry.”

For nearly a decade, the NFC solution has been facing political and commercial problems. Most industries involved in NFC trials did not want to share the substantial revenues generated by this solution. Illustrating this point was the commercial discussion between banks and network operators, neither of whom wanted to share revenues. At the beginning, each wanted to force the other to adopt their business model. At the end, after network operator acquisition of banks and financial company acquisition of network operators, they were forced to admit that cooperation was the best compromise.

The NFC market also has the potential to create revenues for the entire NFC ecosystem. Even if it seems that purely hardware–SIM card and NFC controller–revenues will decrease, the gain will still be really important.

However, most technology providers have been able to offer new services directly linked with NFC. Handset manufacturers, trusted service management system providers and marketing and commercial NFC service providers all stand to benefit.

“Many marketing companies are already involved in the NFC ecosystem,” concludes Jean-Noël Georges. “This is a good signal because, in the past, marketing companies were involved in new technology roll-outs only when the transition occurred from purely trials to first commercial deployments.”

More information: NFC: When Will be the Real Start?

Source: Frost & Sullivan

Filed Under: News, Research Tagged With: Frost and Sullivan, NFC

Hot Trends in Mobile Commerce InfoGraphic

January 28, 2011 by Mobile Payment Magazine

Nearly three-quarters (74%) of online retailers either already have or are developing a mobile strategy, according to the National Retail Federation’s digital division, and trendlines for mobile commerce are off the charts this year.

“Mobile Warming: Hot Trends in M-Commerce” is an informative infographic about mobile shopping trends and statistics, produced by Milo.com.

The company provides inventory availability information from local stores in real-time to find the best prices and availability for products in the shopper’s local area. The site will show what is in stock, where, and at what price.

Here’s just a sampling of some of the statistics:

  • 37% of smartphone users have made a non-mobile purchase on their mobile handset within the last 6 months
  • Top 10 mobile apps include: (1) 1-800-flowers (2) Amazon.com (3) Apple App Store (4) Barnes and Noble
  • PayPal’s worldwide mobile transactions have skyrocketed from $25 million in 2008 to $500 million in 2010

To view these statistics and more from Milo’s excellent infographic, visit: The Daily Bark

Filed Under: Featured, Research Tagged With: infographics, Milo, mobile commerce

Mobile Payments Research Report 2011: Battle in a Fragmented Market

January 21, 2011 by Mobile Payment Magazine

Research and Markets  has announced the addition of the “Mobile Payments – A Battle of Giants in a Fragmented Market” report to their offering.

This study spotlights the mobile payment market, provides details about the related services and their technological aspects, analyses the usages and the industrial structure with a drawn of the value chain. The report makes an in-depth look in examining several business models – for NFC, SMS, Fixed/mobile wallet & App Stores – their impacts and upcoming opportunities.

Key Questions

  • What are the different mobile payment services and which technologies are being used?
  • Who is using M-payment and how do they use it?
  • How are this emerging market and its value chain structured?
  • What are the existing business models and who is the furthest along with their deployments?
  • What are the market’s key figures and what are the main forces driving development?
  • What does the competition landscape look like?
  • What sustainable opportunities are available to the different kind of players?

Key Topics Covered:

  • 1. Executive Summary
  • 2. Introduction
  • 3. Market structure and key factors
  • 4. Organisation & Industrial Strategy
  • 5. Strategic analysis
  • Tables
  • Figures

Companies Mentioned:

  • Amazon Mobile Payments
  • American Express
  • Apple
  • BarclayCard
  • Billing revolution
  • Boku
  • Carrefour
  • Deutsche Telekom
  • Facebook
  • Gemalto
  • Google
  • McDonald
  • MoBeePay
  • NFC
  • Nokia
  • NTT docomo
  • Obopay
  • Orange
  • PayPal
  • PTC
  • Sprint
  • Starbucks
  • Subway
  • Telecom Italia
  • Telefonica
  • Venmo
  • Verifone
  • Visa
  • Zong

More information: Research and Markets

Filed Under: Research Tagged With: Amazon Mobile Payments, American Express, Apple, BarclayCard, Billing revolution, boku, Carrefour, Deutsche Telekom, Facebook, Gemalto, google, McDonald, MoBeePay, mobile banking, mobile payments research, NFC, Nokia, NTT docomo, Obopay, Orange, PayPal, PTC, Research and Markets, Sprint, Starbucks, Subway, Telecom Italia, Telefonica, Venmo, VeriFone, Visa, Zong

Asia-Pacific Mobile Payments to Double in Five Years

January 16, 2011 by Mobile Payment Magazine

Mobile payments (m-payments) in Asia-Pacific are expected to record transactions worth more than two-fold from 2009 revenues of US$1.6 billion in five years, according to Frost & Sullivan. The company estimates that in 2015 m-payments could exceed billings of US$3.6 billion at a CAGR (compound annual growth rate) of 14.8 percent (2010-2015).

Frost & Sullivan industry analyst Shaker Amin attributes this growth to technology innovations and operators’ initiatives – particularly with NFC (Near Field Communication) – as well as rising consumer demand in both the developed and emerging markets.

New analysis from Frost & Sullivan, 2010 Asia-Pacific Mobile Payments Outlook – 18 Asia-Pac nations including Japan, finds that contactless payments via the NFC channel will increase in popularity to account for 23 percent of all m-payments in 2015, from only 12 percent last year.

via Frost & Sullivan

Filed Under: News, Research Tagged With: Frost and Sullivan

How to Measure Mobile Campaigns

January 14, 2011 by Mobile Payment Magazine

In implementing mobile marketing campaigns, it’s important to understand the performance of the campaign and learn how to optimize campaigns for greater success.

Bango has released a new white paper–the fifth in a series on the subject. The paper provides information from experts on how to measure mobile campaigns.

There is an overview of the current mobile landscape, as well as:

  • The importance of measuring your mobile campaigns
  • How to measure your mobile campaigns and get the most accurate view
  • What you need to watch out for – hints and tips
  • What matters to you as an advertiser–Questions answered by experts in the field: Andrew French, Head of Sales at mobile advertising agency; Somo and Erin Mack McKelvey, Senior Vice President of Marketing at advertising network Millennial Media
  • How to analyze your data – Brian Morel, Strategic Account Director for Mobile at Yahoo! answers your questions

More: Information request – Bango.com.

Filed Under: Research Tagged With: bango

Mobile Trends for 2011: Survey Results

January 4, 2011 by Mobile Payment Magazine

Mobile Industry Survey 2011Mobile Payments Magazine launched in response to the tremendous interest in mobile payments and commerce in 2010, and based on a recent survey of executives in the industry, mobile payments is predicted to be a breakout category in 2011, followed by mobile commerce, mobile advertising, and mobile coupons.

According to the  survey respondents, the big winners in this trend would be credit card companies such as Visa and MasterCard, followed by wireless operators, and eventually companies like Google, PayPal, and smartphone makers. Bringing up the rear were startups, though the makeup of the respondents should be considered (categories are shown in the survey).

Executives surveyed thought that Google and Microsoft would make the biggest acquisitions, and more than 90% of those surveyed believe mobile advertising spending would increase by more than 100%, with about 55% putting that number at a 200-300 percent increase.

The survey results include dozens of questions and 24 charts and graphs to illustrate the results. It was conducted by consulting company Chetan Sharma.

More information: 2011 Mobile Industry Predictions Survey Results.

Filed Under: Featured, Research Tagged With: 2011, mobile trends

2010 Mobile Banking Scorecard Research Report

December 21, 2010 by Mobile Payment Magazine

Javelin Strategy and Research has released its 2010 Mobile Banking Scorecard: How 19 Top Financial Institutions Compare on Mobile Channel Retail Delivery. The survey presents an overview of mobile banking services offered by 19 of the 30 largest U.S. financial institutions (FIs) based on deposits. The survey covers five key areas of mobile banking: marketing and security messaging, mobile access, general features, short message service SMS features and security.

As part of the data collection process, mystery shoppers also were employed. They searched each FI’s website and contacted each FI’s customer service representatives CSRs a minimum of four times. Of the 30 FIs researched and contacted in June and July 2010, 19 offer mobile banking services to their customers.

When scoring the FIs, Javelin reviewed a total of 47 criteria. Based on a quantitative analysis of the criteria, FIs were awarded either a gold, silver or bronze status. This report further includes a profile of Bank of America.

More information or to download a report summary: Javelin Strategy – 2010 Mobile Banking Scorecard.

Filed Under: Research Tagged With: Apple, Bank of America, BB&T Corp., BBVA Compass, Capital One, Chase, Citigroup, Fifth Third, google, Huntington Bancshares, ING Group, JPMorgan Chase, Key Corp., Marshall & Ilsley, PNC Bank, Regions Financial, SunTrust Bank, Synovus Financial, US Bancorp, USAA Federal Savings, Wells Fargo, Zions

Verizon Will Have 33% of 376 Million U.S. Mobile Subscribers by 2014, Say Forecasters

December 17, 2010 by Mobile Payment Magazine

The United States will have 376 million mobile subscriber connections by 2014, with Verizon Wireless taking just over 1/3 of the market share, according to IE Market Research, a Canadian market intelligence and business strategy research and consulting firm.

The company’s report shows industry-average subscriber growth in the U.S. wireless market has held steady at between 5% and 6%, with Verizon, the largest operator, seeing its year-over-year subscriber growth decline from 7.9% in 2Q.2009 to 5.0% in 2Q.2010. Sprint-Nextel has been losing subscriber, with a year-over-year rate of -1.7% in 2Q.2010.

Positive EBITDA growth at both Verizon Wireless and AT&T Mobility in 2Q.2010. EBITDA growth rate (YoY) at Verizon Wireless was 7.8% in 2Q.2010, down from 9.4% in 2Q.2009. On the other hand, AT&T Mobility’s EBITDA growth was strong at 18.5% in 2Q.2010, up from 7.7% in 2Q.2009.

IE Market Research produces research reports on a variety of industries in markets around the world. The company’s Mobile Operator Forecast on the United States provides over 50 operational and financial metrics for the US wireless market, with 5-year forecasts at the operator level going out to 2014. Mobile network operators covered for the United States include: Verizon Wireless, AT&T Mobility LLC, Sprint Nextel Corporation, T-Mobile USA, Inc., Leap Wireless International, Inc. MetroPCS Communications, Inc., U.S. Cellular, and Cincinnati Bell Wireless.

Source: IE Market Research.

Filed Under: Research Tagged With: AT&T Mobility, IE Market Research, Sprint, T-Mobile, Verizon

Money Off Coupons Via Smartphone Very Useful, Say Consumers

December 13, 2010 by Mobile Payment Magazine

A global survey by Accenture on mobile devices and shopping shows that smartphone users would find it useful to download money-off coupons to their phones (79 percent), and receive instant money-off coupons as they pass by an item in a store (73 percent). Conversely, fewer than half (48 percent) of smartphone users have downloaded a coupon from their PCs. The survey results highlight how the growing use of smartphone technology and the economic downturn have encouraged cost-conscious consumers to explore alternative retail channels, such as online and smartphones, to secure bargains.

According to Accenture, the findings of its study of 1,000 consumers in 10 countries suggest that couponing could become a more important part of the retail experience as smartphone technology becomes more widespread, and if retailers are adept at using customer analytics to target messages and deals to consumers. Notably, 48 percent of conventional cell phone users plan to buy a smartphone in the next 12 months.

The results of the survey also indicate that smartphone technology is changing the relationship between customers and retailers. Many smartphone users said that they prefer using their mobile device rather than interacting with a store employee for simple tasks. According to the survey, 73 percent favor using their smartphone to handle simple tasks compared to 15 percent who favor interaction with an employee. Similarly, 71 percent favor using their smartphone to identify a store with a desired item in stock, while 17 percent would prefer to get that information by speaking to an employee.

“Smartphones will permanently change the relationship between the store and the shopper,” said Janet Hoffman, managing director of Accenture’s Retail practice. “Today’s tech-savvy consumer wants a seamless shopping experience across store, mobile or online at a time that suits them. Ultimately, this trend will lead to a new definition of the store; purpose, place and size are all up for debate. Already we are seeing some shoppers treating stores more like a showroom to test products and then making their purchase online.”

Privacy, however, remains a key concern of consumers, and could have a negative impact on the growing use of smartphones for shopping. More than half of respondents (54 percent) worry that using smartphones will erode their privacy. Among the other smartphone shopping concerns voiced, 59 percent of respondents fear losing the personal touch from store employees, and 39 percent believe that products would get more expensive.

“The greater use of smartphones for shopping creates opportunities and challenges for retailers in equal measure,” Hoffman said. “Companies need to use all of their customer information to better understand how and when their customers want to engage with them, ask them questions or just check some basic product details. Only then can they deliver a personalized and enjoyable experience, while lessening the risk of alienating customers through unwanted approaches.”

According to Andy Zimmerman, global managing director of Mobility Services at Accenture, these survey results are an early indicator that mobile applications will transform how businesses compete with one another and interact with their customers. “Companies that successfully integrate the location-based services, commerce, payment and other capabilities of the smartphone into their traditional businesses stand to gain significant competitive advantage over the coming years.”

Among the additional survey findings:

  • 69 percent of smartphone users are aware of smartphone applications from large retailers and 48 percent have downloaded at least one application,
  • 90 percent of consumers who have downloaded an application from a large retailer found it “very useful” or “useful”,
  • 56 percent believe smartphones will make the shopping experience more enjoyable.

Methodology

The survey was programmed and hosted online by Lightspeed Research and designed to obtain interviews with 100 respondents in ten markets; U.S., France, Spain, Italy, U.K., Germany, Brazil, Japan, China and India.

To qualify for the survey, respondents needed to have home access to the Internet through a computer or netbook and carry a mobile phone or smartphone with them when they leave home.

Within each country’s sample, quotas were set as follows:

  • 50 male, 50 female,
  • 50 respondents aged 18-35 years of age, and 50 respondents over 35 years of age,
  • 70 respondents who carry smartphones when they leave home, and 30 respondents who carry conventional cell phones. Some report carrying both.

Source: Accenture; Business Wire

Filed Under: News, Research Tagged With: Accenture, Mobile Coupons

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