Everyone is looking at 2020 - the cycle starts again…
Companies like to work in 5-year cycles. It’s a period of time that allows change to occur either naturally (evolution) or dramatically (revolution) and of course, 5-year plans tend to start either at the mid point of the decade or at the start/end of the decade. This week we have seen companies making predictions as to the state of the contactless industry by 2020. So what are we to expect?
Both Visa and Mastercard came out last week with predictions of how ubiquitous mobile payments will be by 2020. Speaking at Mastercard's 'Future of Payments' event in London, Mike Cowan, Head of Emerging Payments Products, explained how the firm is working towards complete contactless acceptance.The payment giant is laying down the law, demanding all new payment terminals rolled out from 2016 must support contactless transactions. By 2018 it's thought there will be 1 billion payment points in Europe supporting NFC contactless transactions, allowing customers to tap a phone or bank card to pay for goods, leading to a total adoption of the tech by 2020.
Despite the cap on contactless payments moving from 20 GBP to 30 GBP this summer, there was a little reticence about forecasting out too much. "The cap is managed at an industry level," commented Johan Lindstrom, Head of Digital Commerce, MasterCard Europe. "Lots of people have a say in it. There's pressure upwards from consumers who want more transactions to be made using contactless, but there's also pressure downwards from fraud teams want to reduce risk."
Visa Europe also put out research last week looking forward to 2020. According to Visa Europe, consumer adoption of mobile payments will grow faster than ever in the next five years, with six in ten Britons (60%) expecting to use their mobile devices for payments at least once a week by 2020. The UK mobile payments boom will see an upsurge in the weekly value spent using mobile devices, with the market growing to an estimated £1.2bn per week by 2020. The average shopper expects to spend £27 on mobile each week by 2020, £10 more than is spent today. In fact, nearly a quarter of respondents (24%) predict they will spend more than £50 a week using their mobile device by 2020.
Jeremy Nicholds, Executive Director for Mobile, Visa Europe said: “While we’re excited to see consumers saying they expect to triple their weekly spend using mobile payments over the next five years, we at Visa think those numbers could be rather conservative and that the actual adoption rate will be much higher. This is particularly true when you look at the growth in contactless usage, which saw European usage grow by 2x and spend grow by 3x over the last 12 months. Contactless and online commerce enhancements have been key in paving the way for the next generation of mobile payment technology. The environmental conditions are already in place to meet the demands and expectations for digital payments. It’s no longer a question of ‘if’ consumers will embrace this new way to pay – it’s when – and for us the next 12 months are when mobile payments become mainstream.”
Google has also been presenting what their Advanced Technology and Projects group (ATAP) have been up to and what products and technical innovation we could be seeing in the next five years. Their offering? The smart jean. By that I mean textiles woven with electronics. Called Project Jacquard, it’s a group of innovations that makes it possible to weave touch and gesture capabilities into textiles and bring us closer to a future when clothing can be used as an extension of our digital lives. (So the press blurb reads). Instead of sewing or gluing an electronic patch to conventional cloth, Google’s wants to bring that technology into the fabric itself, meaning that high-tech conductive yarns could be weaved into fabric using existing industrial looms, allowing for unlimited variation and fashionable designs.
Google project’s website describes their big, fashionable idea; “Project Jacquard makes it possible to weave touch and gesture interactivity into any textile using standard, industrial looms. Everyday objects such as clothes and furniture can be transformed into interactive surfaces. This is possible thanks to new conductive yarns, created in collaboration with our industrial partners.” “We are enabling interactive textiles,” Emre Karagozler of ATAP said, “We do it by weaving conductive threads into fabric. It is stretchable; it is washable. It is just like normal fabric.”
Levi’s thinks they may be onto something, obviously, as Google has also announced it is working with the US jean maker to create a range of clothing that would utilise this techno-fabric. ”In our hyper-digital world, people constantly struggle to be physically present in their environment while maintaining a digital connection,” said Paul Dillinger, Levi Straus’s head of global product innovation. “The work that Google and Levi’s are embarking upon with Project Jacquard delivers an entirely new value to consumers with apparel that is emotional, aspirational and functional.”
All good, aspirational, 5-year cycle, innovative stuff. The only dark cloud last week was the news that Samsung Pay European launch looks to have slipped back from early this summer to September. Samsung Electronics Co Ltd said at a company event on Wednesday in Seoul that it will expand its Samsung Pay mobile payments service to markets such as China and Europe after an initial launch in South Korea and the United States later this year. Initial reports had set the time frame of a release of the payment service in Europe this summer (July) but Samsung Executive Vice President Rhee In Jong told investors that the firm is looking more at a “September time frame” for the initial launch of the mobile payments service in South Korea and the U.S., coinciding with the launch of the firm’s next flagship smartphone model.
The debut in the U.S. and South Korea for Samsung Pay will likely be in conjunction with the company’s next high-end mobile device. “The new service will likely be deployed on its next Galaxy Note device,” said Claire Kim, a Seoul-based analyst at Daishin Securities Co. “The key is how fast Samsung will be able to expand the service to lower-end devices.”
Well, that sucks! I know we’re all supposed to be mobile payment friendly by 2020 but the sooner some of these payment solutions start in Europe, the better. Come on people, only four and a half years left…
Steve Atkins
Contactless Intelligence
