Could 'card clash' spur on the mobile wallet?
To be honest, although I have come across the concern of two or more contactless cards in my wallet causing a problem when using the Oyster on public transport in London, I had never come across the term 'card clash' until last week despite all those cosmopolitan users of Oyster in London being aware of the term for ages. Call me slow. Go on. I dare you.
Fact is, for some reason, last week Twitter went crazy for a couple of days upon the subject of card clash. There is no rhyme or reason for it. I think it it just a case of group grievance. That is, one person has a moan, then another joins in and before long, everyone is having their own moan around a particular subject on a common platform. Or as I know it - sunday lunch with the in-laws. Here is a prime example from Twitter user Robin Thomas @robindthomas; 'Contactless payment cards will be pointless until they are on a different frequency to Oyster cards'. I am not sure that Mr. Thomas totally understand contactless technology but I can assure him that this is not FM radio. However, I can understand his frustration and grievance and as I have said - he is not alone out there. There is even a campaign to educate the users of public transport in London of the dangers.
This got me to thinking. If this is becoming something that the public are concerned about; payment for one item being charged to two cards ('card clash' – I love that, it sounds like an action & adventure film!), then wouldn't this be alleviated by the use of the mobile wallet? Wasn't one of the argument against mobile wallets that they didn't add that much to the actual transaction experience? Well if we explain that the use of mobile wallets could do away with card clash - would that count as a 'plus one' in the mobile wallet score column? Just a thought.
As we are a week out of the Mobile World Congress, it is not surprising that the collective industry news organisations have gone a little quiet - they announced everything they could at MWC and are now trying to get back their second wind. For this reason I ended up doing a little bit of back reading and came across a report issued from Yankee Group a week or so ago but must have got lost amongst the MWC 'noise'.
The report, titled 'US Mobile Wallet Roundup: Gauging the Future Potential of Today's Solutions' in a nutshell is thus: Yankee Group ranks the staying power of Google Wallet, Isis, LevelUp, Loop, MCX, PayPal, and Square as determined by the strength of their merchant and consumer value propositions and ability to deliver on them. Industry critics have (perhaps unkindly) described the mobile wallet market as one that is 'eternally 12 to 18 months out'. However the Yankee Group report says that two-thirds of consumers surveyed are interested in mobile wallets. A caveat to that, though, is only 16 percent of mobile device owners have used their phone to make an in-store payment in the past three months.
The Yankee Group report, written by Analyst Jordan McKee, predicts an inevitable "wave of consolidation" and rates the chances of success for various players in the industry. After reading the report, one thing is for sure, it's no longer so much about who has the best technology but who has the scale to make it cheap, as well as the right backing and partnerships. Yankee Group also point to mobile payments success requiring "added value beyond the transaction", referring to "contextually relevant offers and deep loyalty integration".
Interestingly, ISIS, the joint venture formed by AT&T, T-Mobile and Verizon, is in a 'low potential' category for its lack of ecosystem. Isis is struggling to make a case for deploying SmartTap PoS terminals, which merchants must purchase to enable offers and loyalty redemption. "Without SmartTap merchants, Isis is merely a cumbersome, mobile version of a contactless credit card," Yankee Group concludes. Perhaps this is why they are running a campaign in conjunction with American Express based on loyalty points at the moment.
So, which solutions have 'high potential' according to Yankee Group? Merchant Exchange (MCX) and PayPal landed in this category. They are described as 'mature technologies with built-in customer bases and major backing'. For instance, MCX now represents 59 merchants, more than 110,000 store locations and 30 percent of consumer spending volume. And then there's PayPal, which Yankee Group points out has taken an early lead in the mobile wallet race. With 15 percent of consumers having used its application in the past month to make an in-store transaction, PayPal enjoys nearly four times the adoption of its closest third-party wallet competitor, Google.
And what about Google Wallet? Yankee Group says it has 'medium potential,' citing that just 4 percent of consumers have used it for an in-store transaction in the past month. "More troubling, Google continues to lose money on every single transaction as a result of its hybrid NFC/cloud payment architecture," Yankee Group notes. "Until recently Google’s days in payments looked very numbered, but a slew of announcements in the past four months lead us to believe it may be back on track."
"With the hype surrounding mobile wallets building on a daily basis, separating the signal from the noise has become increasingly difficult. The harsh reality is that despite billions in investment across the ecosystem, adoption of such mobile payment technologies has been far from illustrious," said Jordan McKee, "Just 16 percent of mobile device owners have used their phone to make an in-store payment in the past three months. More concerning, of those using mobile wallets, 73 percent are doing so fewer than five times per month. Clearly, the way we pay for goods and services is not slated to change anytime soon. But although cash and cards may enjoy dominance for some time, with fully two-thirds of consumers remaining interested, it's important to recognize that the mobile wallet is far more of a latent opportunity than a pipe dream."
I'm telling you – card clash avoidance is the arguments to getting better acceptance and user rates for mobile wallets! Just a thought...
In other news last week, PowaTag's mobile payment platform was finally released in the Apps store and Google Play store - you can read about it and watch the video here. There is still not a lot of fanfare surrounding the launch, but I don't know if this is a deliberate tactic or not. Congratulations also go out to VeriFone who won the 2014 Merchant Payments Ecosystem (MPE) Award in the mPOS (mobile point of sale) category at MPE 2014 in Berlin last week. Congratulations!
And finally, Newsweek claim to have discovered the creator of digital currency Bitcoin, Satoshi Nakamoto; a name many thought was a pseudonym for either an individual or perhaps a group of developers. However, after an exhaustive investigation and search, the creator turned out to be a 64-year-old Japanese-American computer engineer, living in California under the name, wait for it, Dorian Prentice Satoshi Nakamoto. He claims he has nothing to do with Bitcoin, but who would have thought that all you had to do to find the most illusive digital currency creator on the planet was to look him up in the Californian/Silicon Valley phone book? Go figure!
Until next week.
Steve Atkins
Contactless Intelligence
![]()
