Carriers join forces for mobile commerce

The term “m-commerce” was a buzzword a few years ago, but offerings such as micropayments and location-based services failed to materialize as money-earners for the carriers.“Bell, Rogers and Telus have been looking at the mobile commerce space for some time,” said Robert Blumenthal, vice-president of products and services for Telus. “Largely speaking, it’s been unsuccessful or marginally successful.”
The reason, said Blumenthal, is that each of the carriers attempted its own approach to m-commerce, fragmenting the market. By banding together to create a common company and infrastructure they can all use, the providers can share the burden of costs associated with services and present a united front to cellphone users. The company, established in early November, is called Wireless Payment Services Inc. Its first m-commerce application will allow customers to top up prepaid cellular accounts directly from their phones using a debit or credit card account.
That service should be available by this time next year, said Jeff Chorlton, the company’s president, and will be the first of many.
Chorlton said he was approached by the carriers to head up the new company because he has a history of working in financial services. The idea, said Chorlton, is to turn a consumer’s cellphone into a mobile wallet.
“Their mobile device will essentially enable them to use debit and credit card facilities. To them, it will appear as a debit or credit card (payment) and to the merchant, the same thing. The intent here is to make it as simple as possible,” Chorlton said.
The key to making mobile commerce work this time around is co-operation between the carriers, said Roberta Fox, senior partner at Fox Group Consulting, based in Markham, Ont.
“The shift in the mobile market is where you have competitors coming together to some joint investments for things that they all need,” said Fox. “Each one of these companies could probably not afford to put in m-commerce on their own. It took 20 years for the banking industry in Canada and now it’s everywhere and everybody’s making money on it.”
WPS will act as a common infrastructure for the carriers and the company is currently issuing RFPs to various software and hardware providers in order to build the necessary technology backbone, said Chorlton. Those proposals are due back on Dec. 15.
“We will build the infrastructure and each one of carriers will build its own services that will access WPS,” Chorlton said.
Currently, only Bell, Telus and Rogers are involved, but other wireless operators may join at a later date, Chorlton said.
The timing is right for a re-emergence of m-commerce, said Fox.
Investment capital dried up when the carriers tried it the first time around due to lack of results, but interest has been renewed in the last few months due to the development of technologies such as Wi-Fi and various carrier-grade deployments of third-generation (3G) wireless networks.
For example, Bell Canada recently announced the availability of its EVDO network.
The work being done with m-commerce is designed to appeal to consumers but also to merchants who would eventually be able to take advantage of the mobile wallet, said Blumenthal, and allow their goods and services to be purchased using cellphones.
The fact that merchants would be able to use a single interface made available through WPS would allow them to reach a variety of cellular subscribers.
“If every merchant had to connect up to each of the wireless service providers in their own unique way . . . we would again have a very fragmented approach,” he said.
There are successful m-commerce models already working in nations such as Finland, said Chorlton.
“What we’re hoping to do is take the best of what these other countries have done and combine it.”

Would you recommend this article?


Thanks for taking the time to let us know what you think of this article!
We'd love to hear your opinion about this or any other story you read in our publication.

Jim Love, Chief Content Officer, IT World Canada

Featured Download

Related Tech News

Get ITBusiness Delivered

Our experienced team of journalists brings you engaging content targeted to IT professionals and line-of-business executives delivered directly to your inbox.