Mobile Payments to be Launched by 2012 in the U.S.

Deutsche Telekom Details NFC Mobile Payments Rollout Plans

February 21, 2011

NearFieldCommunicationsWorld.com - NFC services will begin in Germany and Poland in 2011 and in the US, the Netherlands and the Czech Republic in 2012. In Germany, the operator looks set to offer its own payments service but in other countries it will partner with other operators or with banks, depending on market conditions.

Following Deutsche Telekom's announcement last week that it will begin commercial NFC services in 2011, the telecoms giant has now provided details of when its T-Mobile and other mobile network divisions will launch NFC services in particular countries and has outlined the kinds of business model it plans to employ.

Commercial services will begin in 2011 in both Germany and Poland, where Deutsche Telekom recently became the sole shareholder in mobile operator PTC, owner of the Era brand. In both countries, Deutsche Telekom says "it is planned to start the first NFC services on a common platform" — suggesting that other mobile network operators in those countries are also poised to begin commercial NFC services in the near future. Orange, for instance, said earlier this week that it would begin offering the new Samsung Wave 578 NFC phone in Poland from the second quarter of this year.

Deutsche Telekom is already working with other mobile operators in Germany, including Vodafone and O2, to provide the Mpass SMS-based payments service. And, in Poland, there are plans to introduce an NFC-compatible contactless ticketing system for stadium access to the European Football Championships in 2012.

In the US, the launch of T-Mobile NFC services will take place in 2012 in conjunction with AT&T Mobility and Verizon Wireless, the mobile network operators' partners in the Isis NFC joint venture. The Czech Republic and the Netherlands, where T-Mobile is part of a joint NFC initiative involving the country's leading banks and mobile operators, will also see commercial launches in 2012.

"The area of payment systems is a major driver of growth for Deutsche Telekom," says Thomas Kiessling, the company's chief product and innovation officer. "We have continuously invested in this business, and will continue to expand it — nationally and internationally."

"After the acquisition of the internet payment service company Firstgate with its Click & Buy brand in 2010, Deutsche Telekom will successively introduce a whole portfolio of innovative and competitive payment solutions for customers and retailers starting in 2011," Kiessling added. "Applications include paying over the internet as well as remote and proximity mobile payment."

Exactly how T-Mobile will deliver mobile wallet solutions in each country is, however, still to be completely decided. The company may "have financial relationships and perhaps own a financial entity" as demand for the transactions and associated services grows, Deutsche Telekom's CTO has told Bloomberg.

"Just as easily, we could have a deep and dramatic partnership with a financial institution," he added, in order to help handle the requirements of large-scale mobile payments.

World’s Leading Mobile Operators Commit to NFC-enabled Electronic Transactions

February 21, 2011

NearFieldCommunicationsWorld.com - The GSMA has issued a statement outlining a commitment by leading global mobile network operators — many of whom have not previously been involved in NFC — to launch commercial services in 2012.

"The operator community is focused on driving the standardised deployment of mobile NFC, using the SIM as the secure element to provide authentication, security and portability," says the announcement.

"Many of the world's leading operators, including America Movil, Axiata Group Berhad, Bharti, China Unicom, Deutsche Telekom, KT Corporation, MTS, Orange, Qtel Group, Softbank Mobile, Telecom Italia, Telefonica, Telekom Austria Group, Telenor and Vodafone, have voiced their commitment to implementing Near Field Communications (NFC) technology, and intend to launch commercial NFC services in select markets by 2012," according to a statement issued by mobile network operator's association the GSMA today.

"NFC is perhaps best known for its role in enabling mobile payments, but its applications go far beyond that," says Franco Bernabe, chairman of the GSMA and CEO of Telecom Italia. "NFC represents an important innovation opportunity, and will facilitate a wide range of interesting services and applications for consumers, such as mobile ticketing, mobile couponing, the exchange of information and content, control access to cars, homes, hotels, offices car parks and much more."

"The market potential for NFC is significant — according to Frost & Sullivan, the total payment value for NFC globally will reach more than euro 110bn in 2015 — and momentum behind the technology is growing rapidly," says the statement.

The statement then continues with what is, in many ways, the most interesting part of the announcement for those tracking NFC on a regular basis:

"To address this opportunity and to provide valuable new services to mobile users worldwide, the operator community is focused on driving the standardised deployment of mobile NFC, using the SIM as the secure element to provide authentication, security and portability," it explains.

"To achieve this, the GSMA will develop the necessary certification and testing standards to ensure global interoperability of NFC services," it adds. "This interoperability is critical to the widespread adoption of NFC, enabling users to benefit from NFC services around the world, regardless of operator network or device type."

"As we have seen, the adoption of different approaches to NFC will only serve to fragment the market," says Bernabe. "By uniting around a single standardised approach to mobile NFC and by collaborating across the entire ecosystem, our industry will continue to develop the compelling services that customers demand."

NFC World's take: This is one of the strangest press releases we've seen yet. Does the announcement mean that "the world's leading operators" have found an answer to the need for a viable business model for the launch of commercial NFC services? Or is it just that they are running scared of rival proposals due to arrive soon from the likes of Google, Apple and others? These are set to be based on the use of an embedded secure element, rather than the SIM — and hold the potential to cut the operators out of the NFC revenue chain altogether...

Google Chief Outlines Vision for NFC

February 21, 2011

NearFieldCommunicationsWorld.com - An NFC-enabled mobile phone that knows you need new trousers, knows where you are at any given time, and can tell you the nearest place to buy a pair is the vision of outgoing Google chief executive Eric Schmidt.

Confirming that NFC, enabled by the coming wave of Android smartphones outfitted with near field communications technology, could turn into a serious business for the company, Schmidt said Google could work with advertisers to "extend offers to phones with NFC chips".

He told delegates at the Mobile World Congress in Barcelona last week that NFC chips, such as the one in the Nexus S, can be used as a secure ID for electronic transactions, and presented a "mega opportunity" for Google.

"NFC has been around for a long time but everything has just started to come together," said Schmidt, who will turn over the chief executive role to Google co-founder Larry Page in April, but will stay on at the company with the title of executive chairman.

Outlining his vision for how the technology would work in practice, he added:

"I'm walking down the street and I need pants [trousers]. My phone has an NFC chip. It knows where I am. It tells me about two stores, one to the left with a 20% discount and one to the right with a 30% [discount].

"It is programmed to know I am a cheapskate so points me to the right and the store knows what pants I want.

"You don't think this is going to work, guys? Trust me, this is consumerism."

Schmidt noted that consumers would have to opt in to such a mobile promotion and shopping service so that the application and databases, located in the cloud, would be able to act on their likes and dislikes and buying patterns.

Schmidt didn't say anything about Google offering a payment service itself,though speculation continues that it would be involved in the payment transaction.

His speech at the conference backed up an article he wrote last month in the Harvard Business Review, in which he explained that mobile money is one of three key areas of focus for Google in 2011.

In December, Google included support for NFC in the Android 2.3 Gingerbread operating system and near field communication functionality is also included in the Nexus S smartphone.

The company launched its first NFC marketing service in Portland, Oregon the same month, while it emerged last week that Austin, Texas, will be the second location for Google's roll-out of its NFC Hotpot marketing service.

As with the service already live in Portland, the 'Recommended on Google' stickers being distributed in Austin contain an NFC tag. Consumers equipped with an NFC phone simply touch their phones to the posters in order to access information on the service provider via the Google Places with Hotpot service.

Google has now released Android 2.3.3, an update to Android 2.3 Gingerbread, specifically designed to add more NFC functionality to the operating system.

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