European operators dash for m-commerce involvement

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Mobile commerce appears to be entering a new phase as European operators engage in a mad scramble to form partnerships with financial services firms and rival mobile operators.

The recent announcement from the three major UK operators to build and share a common m-commerce platform is the most recent example--albeit that this move looks hurried, lacks substance and excludes, much to its annoyance, 3UK.

Given that NFC technology, upon which operators are basing their solutions, has been around for many years, what has provoked this sudden and rather panicky move to embrace m-commerce? A possible answer has comes from a KPN executive speaking last week at the GSMA's Mobile Money Summit in Singapore.

Peter Van Leeuwen, strategy and business development manager for the Dutch operator, believes that mobile networks and banks are in danger of not gaining ownership of the m-commerce channel and being relegated to being bit pipes in the value chain.

While stressing that partnering with banks would strengthen the overall proposition, Leeuwen displayed a hint of paranoia with the warning that the financial services industry needs to accept that mobile is the new form of communications for consumers.

His fear about being left out of this new m-commerce bonanza is not without foundation. Visa's announcement that it is trialling handsets in France equipped with microSD cards and NFC chips to enable m-payments--and cut out any operator involvement--is an indication of how one financial firm views the opportunity.

But this upsurge in activity is supported by research firm Yankee Group's latest market research, which claims that the number of NFC-enabled handsets will grow from just 7 million in 2011 to 203 million in 2015, a CAGR of 208 per cent. additionally, the firm predicts the value of global mobile transactions will grow from $241 billion in 2011 to more than $1 trillion by 2015, a CAGR of 56 per cent. The study also has the EMEA region as the hottest market for mobile money, accounting for 41 per cent of worldwide financial transactions.

But Gigi Wang, chief researcher officer at Yankee, warned of the need for interested participants to not wait to be invited. "We are on the cusp of a burgeoning mobile money marketplace, one where first movers will gain a significant strategic advantage."--Paul