EDITORIAL: Hype versus reality in the contactless sector

This editorial was first released on Monday 6th March. Contactless Intelligence Weekly News Review Editorial – Week 10, 2017:

The one area that the Mobile World Congress never fails to deliver upon, is hype. That’s why so many industry sectors go there, right? Such is the desperation of the mobile and telecom industry to hype up the next big thing with glitzy booths and promises of a better tomorrow, that reality is not allowed to gatecrash.

By reality, I mean the truth. For example, take the idea of the connected car. Every stand, it seems, had a car on it this year. However, very few are connected to anything of significance. “Walk the floor at MWC and you’ll see plenty of ‘connected’ cars – but connected to what?” said one irritated industry exec to one of the Contactless Intelligence team. “I’ve never seen so many VR headsets, but they’re not connected to much at all, just some neat games. How do they fit into these big themes of 5G and IoT?” The over-riding sentiment that came from the show floor is that everyone just needs to get back to basics.

Of course, in the time of ‘false news’ and ‘alternative facts’, we can now also add ‘hitting an air pocket’. That’s little product traction and acceptance to the likes of you and me. Apple coined the phrase and once again its reality over hype. Apple CEO Tim Cook told attendees at the company’s annual shareholder meeting this week, that Apple Pay “hit an air pocket” this year with adoption in the US trailing other countries, such as China and Australia, where NFC is more broadly available.

After a slow start, Apple Pay is now dominating its home country, the United States, but the same can’t be said of China where it is up against a different set of challenges. Data from Boston Retail Partners shows that Apple Pay is now accepted by 36 percent of merchants in the U.S., thus making it one of the most widely available mobile payment methods in the country. However, to date it has received a lukewarm — or perhaps even cold — reception in China, the planet’s largest market for mobile payments.

Hype (or hope), over reality.

There was one group involved in mobile wallets/payment that did deliver reality over hype though this show and the group included Samsung, Ingenico and Smartlink. During MWC and together with additional ecosystem partners, the three companies introduced a contactless concept that combines existing contactless services and aligns the needs of users, industries and governments with regards to an inclusive payment solution under the motto of “Digital Cash for Everyone”.

Demonstrated for the first time at Mobile World Congress 2017, the Contactless Companion Platform (CCP) and its supporters focused on the migration of cash into digital cash with full financial inclusion of audiences that currently have no access to payment cards. With CCP in place, a user can make contactless payments via any enabled device of their choice, whether it’s a dedicated smart card, wristband, key fob, or even a mechanical watch or a smart ring, allowing to leave phone and cash at home.

CCP offers full control of payment by validity, location, time or day, and other parameters decided on during remote top up of a secure token with the companion app on a smartphone. The app supports both Android and iOS operating systems, and receives an immediate notification whenever a payment has been made with a managed CCP device. CCP also has the ability to seamlessly combine payments with loyalty points, vouchers, travel cards, ticketing, and more, allowing users to pool a variety of contactless services in a few inconspicuous devices of their choice.

Further, CCP gives parents the ability to safely transfer money to their unbanked children, stored on an NFC-enabled device (like one of the examples above), and ensure that their children can only spend it on what the parents deem appropriate, for example their lunch thanks to the smart token that’s able to contain optional shopping parameter settings.

And since there’s no credit card duplicated in any of the devices, users don’t need to worry about what happens in case of a loss of a CCP device – a simple remote deactivation of the token is all that’s required, and the knowledge that credit card data remained safe all along is an important positive in the eyes of users, the main funding source never being at risk.

Jörg Suchy, associate director business development LSI, Samsung Semiconductor Europe said, “CCP meets Samsung’s strong engagement with the security industry and commitment to enhance the quality of day to day life with innovative concepts. Existing electronic payment methods, especially contactless solutions, don’t meet the “Beauty of Cash” yet. Key for contactless payments success is the ability to include all social levels from poor to rich, to guarantee simple, direct transactions, and to offer plenty of channels for top-up within a simple-to-use unified solution that goes beyond the many boundaries of what exists today.”

In a time of increasing hype – its actually refreshing to see a solution move to the open market that appears to hit users’ (and implementer’s) needs. I just hope it doesn’t hit an ‘air pocket’ any time soon!

Steve Atkins
Contactless Intelligence

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Categories: Editorial

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