Mobile Payment Magazine

Visa Certifies Samsung, LG and Blackberry Smartphones as Visa payWave Mobile Payment Devices

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Visa payWave

Visa Inc. and Visa Europe today announced that NFC-enabled smartphones from Samsung Electronics, LG Electronics and Research In Motion (RIM) have been certified for use with Visa’s mobile application for payments at the point-of-sale, Visa payWave.

The Samsung Galaxy SII, LG Optimus NET NFC, BlackBerry  Bold  9900, BlackBerry Bold 9790, BlackBerry  Curve 9360 and BlackBerry Curve 9380 have been added to the list of Visa compliant payment products available for commercial deployment by financial institutions.

All the new devices certified by Visa host the Visa payWave application on a secure SIM card and feature NFC (Near Field Communication) technology, the short range communications standard that enables mobile phones to securely transmit payment information to a contactless payment terminal.

“This is an important step for Visa, its financial institution partners and the mobile industry,” said Bill Gajda, Global Head of Mobile Product, Visa Inc. “In addition to issuing plastic magnetic stripe or chip-enabled payment cards, financial institutions can now consider offering their account-holders a way to transform their smartphones into fully functional mobile payment devices.”

Visa’s certification of these smartphones paves the way for mobile device manufacturers, mobile operators and retailers to partner with financial institutions to offer Visa mobile payment functionality to consumers globally.

Visa’s Certification Process

Visa has played a leadership role in establishing global standards for mobile payments, making sure that they are aligned with existing technology and security standards for chip payment cards and can easily be integrated into the existing payments ecosystem. For example: Visa payWave on mobile devices is compatible with existing contactless (NFC) payment terminals already installed at retail outlets worldwide, enabling Visa accountholders to simply wave their enabled phone in front of a payment terminal in order to pay.

Visa has a compliance testing process for both mobile devices and the secure elements that host the Visa payWave mobile application. The process includes extensive technical and usability testing with respect to the Visa mobile payment functionality. This helps to ensure reliable and secure Visa transactions which are compatible with the global standard for chip-enabled payments, and establishes a required signal range for all mobile (NFC-enabled) Visa payment devices. Visa’s compliance testing process helps to ensure the combination of the phone; secure chip and Visa’s mobile payment application will provide the level of security and user experience Visa accountholders have come to expect from Visa.

“Today’s announcement is another example of the momentum we are seeing behind NFC as an industry standard for mobile payments,” said Nick Holland, senior analyst Yankee Group. “Yankee Group predicts that the value of NFC-based transactions will grow significantly, from $27 million in 2010 to $40 billion in 2014.”

Source: Business Wire

35 Million Phones Sold in 2011 Can Make NFC Mobile Payments

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According to a new report by IMS Research, a leading independent supplier of market research and consultancy to the global electronics industry the number of Near Field Communications (NFC)-enabled phones shipped in 2011 totaled 35 million globally. IMS Research forecasts that significant market events and the enablement of other cellular handsets will drive that number to nearly 80 million by the end of 2012.

“After seven or so years of false dawns and frequent disappointment, 2011 has proved to be something of a breakthrough year,” says Don Tait, senior analyst at IMS Research. Most of the leading cellular handset manufacturers have launched NFC-enabled handsets over the last 12 months. They include Samsung, RIM, Nokia and HTC. Apple is the main player yet to release an NFC-enabled handset.”

As well as a stream of launches of NFC-enabled handsets in 2011, there have also been an increasing number of joint ventures and collaborations between different players of the NFC ecosystem. Significant examples include:

  • The launch of Google Wallet in the US
  • The French Government funding NFC in the following cities in France (Paris, Bordeaux, Caen, Lille, Marseille, Rennes, Strasbourg, Toulouse and Nice). Orange plans to sell 500,000 NFC-enabled cellular handsets in France by the end of 2011
  • Orange UK and Barclaycard’s “Quick Tap” contactless payment solution, which was launched in May 2011 in the UK. Retailers that have signed up to this service includes McDonald’s, EAT, Pret-a-Manger and Boots.

Looking forward to 2012, the market for NFC looks even more promising. Sales of NFC-enabled cellular handsets are projected to accelerate during the next twelve months to reach 80 million handsets. Additionally, showcase events such as the Summer Olympic Games in London will help to promote the technology and its benefits. For instance, NFC will be available at the Olympic Park, with Everything Everywhere, Telefonica UK, Visa Europe and Samsung involved in the project. The launch of the ISIS-initiative in Austin Texas and Salt Lake City in Utah in the first half of 2012 will also boost the profile of NFC.

Source: IMS Research

Mobile Industry Predictions Report: 2012

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The Yankee Group has just released its free 17-page 2012 Annual Predictions Report, which looks into what the future has in store for the ever-growing mobility landscape.

Overview:

The world is in transition and in the year ahead, mobile will be both the protagonist and the subject of this instability. During the last five years, networks and the information they carry have plugged more than 2 billion new participants into the mobile economy. The winners in this landscape will be those players that can scale quickly and treat each user as a unique customer.

Report Highlights:

  • The mobile gold rush is global in scale a and touches all customers. In the last five years, 2 billion new users joined the mobile revolution. Looking ahead, mobile workers and consumers will embrace tablets, mobile content and personal cloud services. At the infrastructure level, the operator imperative to monetize all-IP networks will drive investment in policy solutions.
  • Asia-Pacific takes the lead in tablet sales. Yankee Group forecasts U.S. tablet sales will total 17 million in 2011 and almost 25 million in 2012. Similarly, tablet sales in all of Europe will exceed 15 million in 2011 and reach more than 26 million in 2012. And tablet sales in the Asia-Pacific region will total 20 million this year and reach almost 39 million in 2012, more than 50 percent above the U.S.
  • Diameter signaling is taking off. Yankee Group has seen significant request for proposal/request for information (RFP/RFI) activity and expects spending on IP-based Diameter signaling to more than double between 2011 and 2012—growing from U.S.$22 million to U.S.$45 million. And overall, we see the market mushrooming to U.S.$212 million in 2015, for a whopping CAGR of 57.2 percent.
  • Personal cloud services are hitting the high-growth phase. We forecast 17 percent of professionals with three or more devices will adopt a personal cloud service for online storage, backup and synching.
  • Economic woes threaten operators. Western European operators will see churn increase from approximately 2.3 percent per month today to 2.4 percent by the end of 2012, despite operators’ ongoing efforts to migrate customers to postpaid services and long-term contracts linked to new smartphone purchases. The world is in transition and in the year ahead, mobile will be both the protagonist and the subject of this instability. During the last five years, networks and the information they carry have plugged more than 2 billion new participants into the mobile economy. The winners in this landscape will be those players that can scale quickly and treat each user as a unique customer.

For more information and to download the report: 2012 Annual Predictions Report: Mobile

Samsung’s New NFC Chip Enables Secure Mobile Payment by Enhancing NFC with Security Features

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Samsung Electronics Co., Ltd., a world leader in advanced semiconductor solutions, announced today its new system-in-package (SIP) near field communications (NFC) chip, the SENHRN1. The new Secu-NFC chip combines a NFC controller and a secure element storing personal information and security keys with advanced encryption technologies, a prerequisite for reliable and efficient mobile payment on NFC-enabled mobile devices. Samsung´s new NFC solution will be on display at CARTES 2011 from November 15th through 17th at the Samsung booth # 3 C 035 in hall 3 at the Paris-Nord Villepinte Exhibition Center. [Read more…]

Research Report: 2011 Contactless Near Field Communication (NFC) Mobile Payments

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Javelin Strategy and Research has release a new report entitled “2011 Contactless Near Field Communication (NFC) Mobile Payments: Framing Mobile Payments on the Foundation of Mobile Banking.”

Mobile payments have been the source of much excitement for over half a decade, with the latest focus being on near field communication (NFC) payments, which uses short-range wireless technologies to allow a consumer to tap or wave a supporting mobile phone to complete an in-store payment.

Late 2010 experienced a flurry of NFC-related mobile payments announcements, detailing pilot initiatives from numerous financial institutions (FIs), payment networks, mobile phone carriers, technology giants, and third-party developers.

Despite this activity, mobile contactless/NFC is a payment option that is battling limited availability of contactless-ready merchant terminals and mobile technology, as well as low consumer demand. In order to ensure the greatest opportunity for success, FIs should integrate NFC mobile payments with their existing mobile banking platform. Javelin data shows that mobile bankers are the prime financial demographic to jumpstart mobile payments, and FIs should promote the service accordingly.

Primary Questions

  • What is the current state of the contactless payment market, and how has it changed from recent years?
  • What are the key drivers preventing consumer adoption of contactless payments?
  • How should FIs integrate mobile contactless pilots within their existing financial infrastructure, and who should the target demographic be?
  • What are some of the current NFC programs in market today?
  • What is the demographic makeup of today’s contactless payment population, and how can that information be utilized to boost mobile NFC adoption?
  • How can FIs establish the value proposition of NFC among merchants, in an effort to increase merchant acceptance of the service?

Report Index

  • Overview
  • Primary Questions
  • Methodology
  • Executive Summary
  • The State of U.S. Contactless and Mobile Commerce
  • The Consumer Roadmap to Mobile Payments
  • Mobile Banking as the Springboard for Mobile Contactless Payments
  • Demographic Trends – Who Are the Likely Mobile Contactless Users of Today?
  • Mobile Contactless Payments: The Proverbial Chicken and the Egg Dilemma
  • Appendix
  • Related Research
  • Companies Mentioned

Table of Figures

Figure 1: Mobile Payments Ecosystem
Figure 2: Percent of Consumers Who Indicate That They Are Open to Using a Contactless-Enabled Card or Device, 2007-2010
Figure 3: Key Drivers Preventing Contactless Adoption, by All Consumers
Figure 4: Consumer Adoption Roadmap to Mobile Payments
Figure 5: Likelihood of Storing Credit or Debit Card Information on Mobile Phone to Complete a Mobile Payment, by Mobile Bankers and All Consumers
Figure 6: Factors That Drive Contactless Use, by Mobile Bankers and All Likely or Current Contactless Users
Figure 7: Last Time Made Purchase Using Mobile Device, by Mobile Bankers and All Mobile Phone Owners
Figure 8: Frequency of Mobile Purchasing in the Past Month, by Mobile Bankers and All Mobile Phone Owners
Figure 9: Average Mobile Purchase Amount, by Mobile Bankers and All Mobile Phone Owners
Figure 10: Desirability of Mobile Phone Functionality, by Frequent Mobile Bankers, Mobile Bankers (Past 90 Days), and All Mobile Phone Users
Figure 11: Likelihood of Using Mobile Contactless, by Gender, Generation, and All Consumers
Figure 12: Likelihood of Using Mobile Contactless, by Ethnicity and All Consumers
Figure 13: Likelihood of Using Mobile Contactless, by Smartphone Owners, Standard Mobile Phone Owners, and All Consumers
Figure 14: Likelihood of Responding to Mobile Marketing Coupons or Promotions, by All Mobile Contactless Users and All Mobile Phone Owners
Figure 15: Percent of Consumers Who Have Used Particular Contactless Payment Devices, 2009-2010
Figure 16: Likelihood of Using a Contactless-Enabled Card or Device, by Mobile Bankers and All Consumers
Figure 17: Average Times Per Month Consumers Use a Particular Payment Option Per Month for In-Store Purchases
Figure 18: Likelihood of Using Mobile Contactless, by Income and All Consumers
Figure 19: Likelihood of Using Mobile Contactless, by iPhone Owners, BlackBerry Owners, and Android Owners

More information: 2011 Contactless Near Field Communication (NFC) Mobile Payments

Report Says ISIS to Invest $100M to Challenge Google Wallet

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With summer days dwindling, Google (NASDAQ:GOOG) has less than two weeks to make good on its pledge to launch its Google Wallet mobile payment service.

Google Wallet is a mobile application service that will let owners of Sprint’s Samsung Nexus S 4G smartphones use their phone as a wallet at some 20 retailers and restaurants.

Bloomberg said the carrier group, which unveiled its own tap-and-pay effort in July, plans to invest $100 million to build out its mobile payment plans to challenge Wallet.

Read more, via eWeek.com.

comScore Reports U.S. Mobile Subscriber Market Share for July, 2011

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comScore, Inc. has released data from the comScore MobiLens service, reporting key trends in the U.S. mobile phone industry during the three month average period ending July 2011. The study surveyed more than 30,000 U.S. mobile subscribers and found Samsung to be the top handset manufacturer overall with 25.5 percent market share. Google Android continued to gain ground in the smartphone market reaching 41.8 percent market share.

OEM Market Share

For the three month average period ending in July, 234 million Americans ages 13 and older used mobile devices. Device manufacturer Samsung ranked as the top OEM with 25.5 percent of U.S. mobile subscribers (up 1.0 percentage points), followed by LG with 20.9 percent share and Motorola with 14.1 percent share. Apple strengthened its position at #4 with 9.5 percent share of mobile subscribers (up 1.2 percentage points), while RIM rounded out the top five with 7.6 percent share.

Top Mobile OEMs
3 Month Avg. Ending Jul. 2011 vs. 3 Month Avg. Ending Apr. 2011
Total U.S. Mobile Subscribers (Smartphone & Non-Smartphone) Ages 13+
Source: comScore MobiLens
Share (%) of Mobile Subscribers
Apr-11 Jul-11 Point Change
Total Mobile Subscribers 100.0% 100.0% N/A
Samsung 24.5% 25.5% 1.0
LG 20.9% 20.9% 0.0
Motorola 15.6% 14.1% -1.5
Apple 8.3% 9.5% 1.2
RIM 8.2% 7.6% -0.6

Smartphone Platform Market Share

82.2 million people in the U.S. owned smartphones during the three months ending in July 2011, up 10 percent from the preceding three month period. Google Android ranked as the top smartphone platform with 41.8 percent market share, up 5.4 percentage points. Apple strengthened its #2 position with 27.0 percent of the smartphone market, up 1.0 percentage points from the prior reporting period. RIM ranked third with 21.7 percent share, followed by Microsoft (5.7 percent) and Symbian (1.9 percent).

Top Smartphone Platforms
3 Month Avg. Ending Jul. 2011 vs. 3 Month Avg. Ending Apr. 2011
Total U.S. Smartphone Subscribers Ages 13+
Source: comScore MobiLens
Share (%) of Smartphone Subscribers
Apr-11 Jul-11 Point Change
Total Smartphone Subscribers 100.0% 100.0% N/A
Google 36.4% 41.8% 5.4
Apple 26.0% 27.0% 1.0
RIM 25.7% 21.7% -4.0
Microsoft 6.7% 5.7% -1.0
Symbian 2.3% 1.9% -0.4

Mobile Content Usage

In July, 70 percent of U.S. mobile subscribers used text messaging on their mobile device, up 1.2 percentage points. Browsers were used by 41.1 percent of subscribers (up 2.0 percentage points), while downloaded applications were used by 40.6 percent (up 2.8 percentage points). Accessing of social networking sites or blogs increased 2.1 percentage points to 30.1 percent of mobile subscribers. Game-playing was done by 27.8 percent of the mobile audience (up 1.6 percentage points), while 20.3 percent listened to music on their phones (up 2.3 percentage points).

Mobile Content Usage
3 Month Avg. Ending Jul. 2011 vs. 3 Month Avg. Ending Apr. 2011
Total U.S. Mobile Subscribers (Smartphone & Non-Smartphone) Ages 13+
Source: comScore MobiLens
Share (%) of Mobile Subscribers
Apr-11 Jul-11 Point Change
Total Mobile Subscribers 100.0% 100.0% N/A
Sent text message to another phone 68.8% 70.0% 1.2
Used browser 39.1% 41.1% 2.0
Used downloaded apps 37.8% 40.6% 2.8
Accessed social networking site or blog 28.0% 30.1% 2.1
Played Games 26.2% 27.8% 1.6
Listened to music on mobile phone 18.0% 20.3% 2.3

 

Source: comScore

Visa and Samsung Partner to Offer NFC Mobile Payments

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Samsung and Visa have announced plans to bring NFC payment technology to the market as part of their sponsorships of London 2012, enabling consumers to make mobile payments using the Samsung Olympic and Paralympic Games mobile handset.

Samsung Electronics Visa are combining their sponsorship assets and technologies to ensure that the Olympic and Paralympic Games mobile handset available to the general public will be equipped with technology that enables mobile payments, Near Field Communications (NFC) and Visa’s contactless payment technology. To make payments, customers simply select the Visa mobile contactless application, select pay and hold the phone in front of a contactless reader at the point of purchase.

Visa is working with banks and retailers worldwide to roll-out acceptance for Visa contactless cards, as well as mobile phones, as part of an industry wide roll-out of contactless technology. In London there are already more than 60,000 locations where contactless payments are accepted and contactless and electronic card payments will be available in the run-up to and during the 2012 Olympic and Paralympic Games. With the momentum to commercialize mobile payments globally, consumers will be able to make mobile contactless payments in the run up to and during the Games in many countries around the world.

Samsung and Visa will work together to provide the contactless enabled Olympics handset to Visa and Samsung sponsored athletes as part of this initiative. Samsung and Visa also plan to make the handset available for consumers to purchase through mobile network operators and other distributors. A Visa-enabled SIM card will be required for use with the device in order to make purchases at retailers who have the contactless payment system.

“Visa, like Samsung, shares the vision of leveraging our Olympic and Paralympic Games sponsorship to leave a lasting legacy in the market for banks, retailers, mobile operators and consumers. We are not only breaking new ground for Olympic partnerships, we are committed to enabling consumers to connect with mobile and contactless payments technology for 2012 and beyond,” said Peter Ayliffe, CEO of Visa Europe. “We look forward to working with financial institutions and mobile operators alongside Samsung to make this initiative a success.”

“Innovation is a key business driver for Visa and mobile payments are one of the main areas we’re focusing on. The Olympic and Paralympic Games enables us to accelerate our business goals and this partnership plays a large role in achieving them,” said Mariano Dima, Executive Vice President of Marketing and Payment Solutions at Visa Europe.

“As a pioneer in mobile technology, Samsung is striving for long term change in the way we use mobile payments. In London next year, we regard the greatest show on earth as the perfect opportunity to showcase how this technology can make a positive difference to people’s lives – enabling them to feel closer to the Olympic and Paralympic Games. This mobile payment device will be available in the UK initially, and we plan to expand the service to other countries in Europe and around the world where contactless payment facilities are available in the near future,” said Seokpil Kim, President & CEO of Samsung Electronics Europe.

Gyehyun Kwon, Vice President & Head of Worldwide Sports Marketing, Samsung Electronics added, “This marks the very first partnership between two Worldwide Olympic Partners of the London 2012 Games. We are delighted to be joining forces with Visa to make the Olympic Games more accessible and convenient for everyone. This fits extremely well with our ambition to enable more people to participate in the Games through our smart technology.”

Visa and Samsung will work with mobile network operators, financial institutions and retailers around the world to bring the convenience, security and reliability of Visa’s contactless technology to mobile users worldwide. Currently, Visa mobile payments are being rolled out in countries across the globe including Australia, Canada, Czech Republic, Brazil, France, Hong Kong, Italy, Malaysia, Poland, Singapore, Spain, Slovakia, Switzerland, Turkey, the UK and the United States.

Source: BusinessWire

Samsung Announces New NFC Chip with Flash Memory

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Samsung has announced a new NFC chip with flash memory, adding to the momentum around Near Field Communication (NFC) technology that will enable point-of-sale payments via mobile phone.

NFC is a short-range (up to 10cm or 4inches), high frequency wireless communication technology which allows devices such as smart phones to collect or transmit data to another NFC-enabled device without manual configuration to identify devices. In addition, NFC chip can play a role as a contactless smartcard in use for public transportation payments for bus and subway fares and mobile banking payments. It can also read RFID tags in retail stores or on outdoor billboards for convenient on-the-spot data access.

The announcement comes at about the same time as Google announced the Samsung-made Nexus S — the first phone to use the new Android OS called Gingerbread. The camera comes with built-in NFC technology, as well as a front and rear-facing camera to enable video conferencing.

“NFC is recognized throughout the industry as an easy and effective way to transmit encrypted information between mobile devices or between mobile devices and other stationary NFC-enabled devices such as kiosks,” said Tae-Hoon Kim, vice president of DDI and C&M marketing, System LSI Division, Samsung Electronics. “As momentum builds for adoption of NFC technology in next-generation/ upcoming smart phones, we look forward to securing a competitive footing in NFC-based solutions with our new NFC technology, offering powerful mobile characteristics such as low power design and advanced RF sensitivity.”

The Samsung NFC chip will be ready for mass production in Q1 2011.

Samsung is well established in releasing Android smartphones, and with Android smartphones now holding a 23% market share, Samsung seems well positioned to ride the wave toward NFC mobile payments.