Smart Phones Could Drive New Telecom Business Model

The banking industry is moving quickly into this market, as it has huge potential.

Will mobile providers jump into the game or retreat to the transport-only lane?

The average person who walks, drives or travels is encumbered with keys, cash, purse or wallet, cell phone, headset, address book, planner, credit cards, and multiple IDs. Throw into that mix receipts, coupons, maps, CDs and other objects, and it’s no wonder so many personal and work-related belongings are lost, stolen or damaged.

It will be either the banks or the telecom operators who dictate the models for proliferating smart phone technology. Already, banks are moving toward contactless payment cards with RFID chips. However, mobile providers still need to determine what role they intend to play, and how to drive merchants and content providers to their customers and networks.

Key Points:

1. One device to use as cash or credit for small and large purchases, as well as to conduct phone calls, transfer data, obtain transaction histories, plan activities and verify identities.
2. Japan’s largest mobile network operator, NTT DoCoMo launched its mobile payment solution last July with phones using contactless chips.
3. Each stakeholder in the mobile payments value chain has different roles and objectives. According to Sophie Tacchi, IBM’s technology leader for mobile payments, there are three main stakeholders.

The three stake holders are:

1.  
   1. Consumer, or phone holder: This person wants something more convenient and easier to use than today’s credit card or ATM transactions.
   2. Issuer, or the mobile wallet account keeper: (Which could be either a bank or telecom provider). This party will dictate how the fees and usage structure will evolve.
   3. The merchant: Who can be a physical storefront, a kiosk or an online entity that could market to and manage life cycles of customers in a fully automated fashion.

This is something about smart phones and how it will be helpful in some new business models, but knowledge is never complete so I am looking forward for some insights from your side too. Happy Reading