NFC Mobile Technologies An Assessment

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NFC Mobile TechnologiesAn Assessment

• Digital Money Summit28-29 November
• SydneyExploring the implications of Australia
  developing its contactless payment methods

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Consumers adopt more faster
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Reality vs Fiction
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Discussion points

• What is the market potential for NFC, given the
  technology that is currently being used?
• How can NFC technology be used, besides retail
  transactions?
• How do you convince the public to use a
  technology they may already have in their pocket?
• How to get them active on a mobile money service
• Linking the major players to make NFC viable
  realistic

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Mobile expectations

• Communication
• Camera
• MP3 player
• Web Email
• Applications
• Enabled by
• MNO networks SMS, USSD, WAP
• Additional interfaces
• Wifi, Bluetooth, IR and

More than 200 projects across 54 countries
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Mobile is not all about NFC
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How are we transacting?

• Gartner mpayments 86bn in 11, up 176 on 10
• EY mpayments reach 245bn by 2014
• IDC smartphone sales outpace PCs 100.9m to
  92.1m (Q4/10)
• Juniper 700m NFC enabled devices by 2013
• Analysts have been downgrading 2011 expectations
  all year
• Juniper only 4 of smartphones have security
  software
• 50 of Facebook users interact via mobile, twice
  as active
• Frost Sullivan (Aust) 13 increase in online
  retailing to 13.6bn, UK at 44bn or 10.7 of
  sales

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Proposition developmentNFC is More than just
payments

• NFC phone is not just a card emulator, it is also
  a reader
• Like QR codes, accesses online content fast
  without need to key in URLs
• Could support a number of contactless
  environments eg RIM HID
• Acts as a key to services or functions including
  a Wallet
• Some examples

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NFC opportunities
Clarion Hotel, Stockholm
Farm shop, Austria
The one we all talk about
Cambridge Christmas Lights
HomeCare health, NL
Museum of London
Corporate access
Marketing
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The Mobile PhenomenonNavigating the Hype Cycle

• Evident that the industry is yetto reach the
  peak of inflated expectations yet real
  business propositions are emerging for mobile
• Significant investments arebeing made to corner
  the market however not all will become viable
  or winning business models
• Consumer owned controlled points of access
  significantly outstrip bricks mortar focused
  points of access - POS, ATM or kiosks
• Identifying innovations that are relevant, viral
  and likely to become ubiquitous

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The NFC ecosystemIts a jungle out there

• Many and varied stakeholders dependent on
  proposition design
• For bank card issuers it is incremental
  investment the card remains resulting in two
  chip applet life cycles to manage
• Who sits in each role is the ongoing debate
  some are working together across or within
  sectors many are not

Customer
Trusted Service Manager
App Store Owner
SE
Content Provider
MNO
Infrastructure
Handset Manufacturer
SE Secure element, USIM, Handset, MicroSD,
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Where is my Wallet?

• In the Cloud
• On the SE
• Oroton

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Customers Adoption

• The digital age has changed the argument on
  Customer ownership
• Adoption and a path to ubiquity requires a strong
  Call to Action
• The digital age has unlocked the ability to
  engage with Customers in a Dialogue no longer
  the monologue
• Think of Yourself as the Customer
• The moment that matters is the Transaction
  Moment

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The Transaction Moment

• The proposition that captures and engages the
  full transaction moment can best influence
  Customer behaviour
• Engagement before after the payment activity
  will establish the requirements for supporting
  technologies
• Transaction mobility enables new channel and
  distribution strategies

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Overcoming the hurdles

• No one single organisation can make this work
  collaboration is mandatory
• Recognise that mobile will remain a companion
  tool to mainstream payments for some significant
  time
• You still carry magnetic stripe, holograms,
• Consider the proposition for the end user
  enablement
• Investment appetite and ubiquity of technology
  with the end user mobility will be is more
  than the phone
• Is your strategy for remote or bricks mortar
  channels or a combination (40 of online in UK is
  on collection - Urbis)
• Add-ons and other requirements raise barriers
  outside of trials (Did no one learn from Blue,
  ANZ First, Mondex, )

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A developing model
RT rewards/member platform to manage
offers/discounts/reward points support a
rewards exchange to encourage new members
In app convenient code scan function. No need to
download app scanner for in-store comparisons or
link to member portal for Customer opinions
Online access to catalogue with link to e-wallet
for payment delivery details
RT Customer service portal including video
demonstrations or help
NFC can enhance to facilitate in-store activity
replacing the QR reader
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The winner is

• Mobile technology penetrates many of our daily
  interactions across multiple end devices
• Customers are learning
• Customers are not yet fully trusting
• The Australian NFC opportunity is greater than
  many markets with a growing acceptance
  infrastructure
• Lack of NFC enabled devices remains a hurdle
• Smartphone contract cycle ensures at least a
  2013/2014 level of adoption
• Contactless adoption lessons need to be addressed
  to build confidence on when I can Tap Go

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Thank you

• Ian Povey
• ian.povey_at_cardsconsult.com
• Mobile [phone]
• www.cardsconsult.com