Mobile financial services: Can't we all just make a deal?

Can you imagine handing a waiter your mobile phone at the end of a meal? Venyon US CEO Tom Zalewski pointed out that the waiter could do more damage to your financial situation with a credit card, but there's something about the mobile phone that makes it seem like even more of a trusted device.

Chances are that most restaurants will not be handing out bills with leather pouches for NFC-enabled handsets anytime soon, but wireless carriers, banks and credit card companies say the transition may be inevitable.
NXP Semiconductors business developer manager for near field communications Dave Holmes pointed out that NFC payments services via mobile phones are already popular in Japan.
Japan is well ahead of us in many areas of mobile commerce particularly in contactless mobile transactions space... but the business networks, business style, and business ecosystem is fundamentally different over there than it is here in the U.S.," Holmes said. "One difference in particular is that one carrier, [NTT] DoCoMo could invest in a bank, invest in a retailer and make that [mobile commerce] system work" all on its own, he said. "The U.S. market is far more complicated than that to make it work so easily."
Damien Balsan, a director of business development at Nokia explained the chief barrier to mobile financial services in the U.S.: "There's always this, I don't want to say 'fight,' but there's always this… tension. It's so hard when you have banks making money on transaction fees and working so hard on the risk management and on the other hand you have the operators setting up their networks. It's so hard to get them to do some revenue sharing."
AT&T's director of mobile financial services Spencer White told former Sprint Nextel executive and now CEO of Mobilians, Prag Shah that he needs to be patient and take a lot of time to explain to carriers the value proposition of mobile financial services. Shah, however, does not think the technology cycles or the time it has taken to develop business models should take quite so long.

"I think one of the largest challenges is trying to bring down the cycle times," Shah explained. "The cycle time for both the chipsets and the handsets needs to come down since 18 to 24 month cycles are not uncommon. "Even though the space is heating up very quickly the technology cycles are long and figuring out the business cycles are long, too."
Shah later asserted that the barrier to market for mobile financial services "is not the technology—it is all about the business model."
James Anderson, MasterCard International's VP of product management, seemed to agree: "If I were king for a day, one thing I would do is lock my best issuing [financial services] customer and my best carrier customer in a dungeon and put them in chains and not let them out until they came to a deal," he said. "It might take three months." –Brian

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