Paypal, Verizon, Isis and the promise of NFC

Yesterday Paypal announced NFC integration for its shop and pay mobile transaction service.  Paypal has made a number of moves and acquisitions lately so its not a big surprise.  On the other hand Verizon is touting NFC for more than payment systems, which for the time being is probably going to be a hotter and more consumer ready use of the technology. Verizon says its sticking with Isis but we will see how long it can fight the desire to join the Google Wallet push.  And finally from GigaOM Pro, we get a prediction that the applications surrounding NFC platforms will likely be the biggest driver for consumer adoption in the near future.

First up Laura Chambers, Senior Director, PayPal Mobile:

Laura Chambers, Senior Director, PayPal Mobile

“Today at MobileBeat 2011 we took another step towards realizing the PayPal vision of creating an entirely new way for people to shop and pay – anytime, anywhere and on any device – with the announcement of our peer-to-peer NFC solution. At this morning’s session, I had the privilege of demoing our new NFC-enabled Android widget that lets people pay and get paid in a matter of seconds by simply tapping together two Samsung Nexus S phones. This feature will be out in the market late this summer.

PayPal is again leading the pack by bringing NFC payments to life on the Android platform. But this is just one of the many ways we’re using different technologies, on different devices, to change the way people pay and get paid.”

Verizon Chief of Technology: Humphrey Chen

Meanwhile the good folks at Verizon are also talking about NFC but not for transactions. NFC Times has a post about a talk at MobileBeat 2011 by Verizon’s Chief of Technology, Humphrey Chen. Chen indicated that the joint venture with Isis for mobile payments is still a go but that payments represent only a few of the keys in the NFC “key chain.”

From NFC Times:

“In one report, Chen pointed to the secure element as anchoring the key chain, and the telco could rent out space on it to service providers.

He talked about Verizon building an “AccessID” infrastructure, geared toward business-to-business applications, though there would be a consumer edition. The telco would put much marketing resources behind this initiative, Chen reportedly said. The secure element in the NFC phones apparently would underpin the AccessID infrastructure.”

And what does the future hold in store for our old friends at Isis? From Chen’s remarks its hard to tell but it doesn’t look like they are ditching them quite yet.

“Chen’s comments are among the clearest yet from a Verizon representative about the carrier’s plans for NFC separate from the Isis joint venture. There have been rumors that Verizon has been charting more of an independent approach to NFC, while not breaking with Isis. But Chen did not confirm these rumors. And the Isis telcos had always planned to roll out their NFC wallets separately, using Isis as an interoperable platform. It has been unclear, however, just how much autonomy the telcos’ wallets will have from Isis and the Isis brand.”

All of this NFC talk is still at the hype or vaporware level for most consumers.  If you don’t have a Nexus S phone you can’t even play the game (unless you have stickers!) A recent GigaOm Pro report highlighted the fact that not all consumers are going to be conducting financial transactions on their phones via NFC, but that there is still plenty of opportunity for the technology to work its way  into everyone’s every day lives.

From the GigaOm Pro report (PDF): subscription requireed

“NFC-based payments have long been commonplace in Japan, where carriers, banks and retailers have collaborated to roll out services that are easy for consumers to understand and use. But that kind of collaboration has been lacking in most other worldwide markets, which is why deployments and uptake have lagged. Substantial challenges remain for the space, including buildouts at the retail level and the establishment of viable business models. Perhaps the most important factor in mobile payments, though, will be in giving users a reason to use their phones rather than credit cards or cash.
That’s why we believe in the U.S. as a mobile-marketing tool rather than as a payment technology. NFC can be used to transmit marketing collateral or product information or to send and receive data between handsets. That kind of usage could become part of larger NFC-based payment systems that combine social elements and location-based deals in addition to supporting transactions. Those systems could enable users to track their purchases and monitor their households’ budgets. So while the underpinnings for a thriving mobile-payment industry are being laid, applications that provide real value to consumers for the space to succeed.”

About Daniel Davenport

Daniel is a digital media executive with internet and broadcast experience. Daniel is currently the executive strategy director at THINK Interactive.

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