@meths and others
Re Google Wallet introduction in the UK. The big issue is the lack of NFC readers at retailers --- in fact the numbers of them in the US which has introduced Google Wallet is in the thousands to maybe hundred thousand rather than million. Reading about Verifone (manufacturer of NFC readers and member of Google Wallet consortium), recall such a reader costs the retailers up to $ 200 so to rip out the current non-NFC reader requires faith on part of retailer or customers asking for its convenience and figuring it will help retailer gain more sales. My thinking is that someone will need to offer incentives. Google believes that the retailer should be the one and that retailer will recoup monies through a variety of ways including more traffic, ability to offer coupons, etc. Carriers/operators see this as a way to become more relevant so they may offer retailers incentives. Here is an article I saw today which frames the dilemma in UK fairly well, despite Boris' promise to make the Olympics the first cashless one. Sadly it might require Apple to get behind the idea to make it really take off, according to one comment.:
Why can’t operators seize the reins for NFC to take off?
Mon, 16 Jan 2012 | By Ronan Shields
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The time for hype is over, showing people how to make mobile payments is what’s needed if it’s ever going to take off.
This year more has kicked off with feverish anticipation about the growth of mobile payments and especially those using NFC technology.
I don’t know if it’s the fact that the UK, one of the few markets to have launched mobile payments using NFC, will be hosting the Olympics or that London mayor Boris Johnson has already dubbed the tournament “the cashless games”.
Either way, the excitement’s building as more and more handsets come on to the market.
However, mobile payments are still a long way from becoming mainstream and NFC’s status as the mobile payments tech standard is far from fait accompli.
This point was underlined last week when polling company YouGov released its Mobile Wallet study, which revealed that just one fifth (20%) of contactless card owners, which use NFC technology, have ever used their cards to make a contactless payment.
YouGov’s survey also revealed that 27% of contactless technology owners cite the lack of retailers offering the service as the main reason why they do not use their cards (nma.co.uk 13 January 2012).
Despite leading brands from the high street and technology industries supporting NFC, 67% of respondents in the survey were unaware of which banks offered the service.
What’s clear is that education is needed if the technology is to become mainstream, although it’s unsure who should lead the initial charge, the technology sector or the high street?
Although YouGov’s report suggested that it’s up to the banks and other financial institutions to educate the public, I believe it’s the mobile operators that are best placed to lead the education.
Perhaps retailers, banks and other parties could support this either by jointly funding any such drive and underlining the same “lessons” in their outlets?
The mobile operators are best able to advice a user on which handsets have NFC capability or possibly provide handset peripherals that could facilitate in-store mobile payments.
After all, Everything Everywhere’s Orange already has a mobile payments offering in place but the company is not exactly breaking its back to promote its Quick Tap series. Neither is it keen to share user numbers (nma.co.uk 7 December 2011).
A tremendous opportunity for operators to assert themselves at the centre of the mobile payments ecosystem is in danger of being lost.
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READERS' COMMENTS (3)
Peter Matthews | Mon, 16 Jan 2012 5:51 pm
Retailers are not likely to invest in kit that makes transactions more expensive for themselves. The current contactless bank cards are RFID and the issuers of these cards are expecting retailers to accept them for small value transactions instead of cash. Not many do, as we have seen. Will those that do now throw out their current readers and buy new NFC readers? Think not. Given that mobile operators will add another layer of cost to a transaction, NFC as currently defined is going to be a while coming... What's needed in a deflationary market is a cheaper way of conducting transactions, not a more expensive one.
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Mike Halstead | Mon, 16 Jan 2012 6:35 pm
NFC - "Not for consumers" or maybe NFCY - "not for consumers yet". I agree the education process must be both mobile operators and the High Street. The Olympics will be a natural platform. There still seems to be more talk than action, not the route to Gold in 2012.
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David Stone | Mon, 16 Jan 2012 11:49 pm
There is a big marketing job to be done here. The industry sometimes appears more tariff focussed than education focussed, which leaves the consumer completely confused. The Apple IPhone has been the game changer. Perhaps if we see NFC on the IPhone, consumers, banks and retailers will start to join the party?
David Stone, MSc.