Monday 13 October 2008

MomoLondon: NFC

This was a great Mobile Monday — interesting presentations followed by a captivating panel discussion, and even better mingling over drinks! I arrived late, caught the end of the first presentation and only started blogging by the second one. Nevertheless, NFC really gets people’s juices going! Shame we’ve been stuck in the trial phase for four years…

Claire Maslen — Head of NFC, O2 Telefonica

Claire gave a good overview of the O2 NFC Trial, as reported in the Evening Standard by the headline “9 out of 10 people would like an Oyster phone!”

  • 500 O2 customers with a Nokia 6131 NFC for 6 months
    • Oyster
    • Barclaycard Visa
    • Access control at the O2
    • One use case of smart posters
  • O2 owned the customer data
  • “Agency said at the end that this was the most compelling evidence they had seen for rolling out a new technology”

Oyster integration

  • Worked with Transys and TfL for the Oyster card implementation
  • 87% said that Oyster in their phone would drive their decision to buy a mobile phone — interesting to mobile operators

Barclaycard Paywave

  • less people than Oyster said they were interested, but then Paywave is not common usage yet
  • more efficient for retailers than cash but only 47% said they’d be interested in going further

Other results

  • Were people happy to leave their homes with just their phone?
  • Customers initially complained that 6131 was too low-end, but realised that applications were what was useful (perhaps they felt that Series 40 is a better interface than Series 60?)
    • However, it’s not one size fits all
  • People were happy with using stored value without a PIN

How can we add more value?

  • put a loyalty card in it
  • do more smart posters — didn’t have enough to really try it out
    • only use case was touching a Tutankhamun poster
    • got a mobile internet page about the exhibition with a link to the TfL mobile site

Panel discussion, led by Dan Appelquist

  • John Hill, MD, IBridge — involved with Oyster since original design
  • James Anderson, Mastercard Worldwide — product development in mobile centre of excellence
  • Steve Griffiths, MD, iconmobile — built Visa wallet
  • Victoria Richardson, Head of Marketing, Proxama
  • Claire Maslen, Head of NFC, O2 Telefonica

Where are the contactless readers?

  • CM: Visa will be rolling out 25,000 in London before Christmas
  • JA: Mastercard recently announced 37m devices (mainly cards), 100K+ locations
    • Currently ahead of the pace of chip&pin
    • The pace of innovation always takes longer than people expect…

What about security? Esp. MiFare vulnerability

  • JH: nothing is 100% safe, but it will be a relatively safe environment
  • JA: group at Mastercard called “payment systems integrity” — this is not one of the issues that’s keeping them awake at night
    • There’s lots of systems behind the scenes that keep the system effective
    • There’s a trust element with smart posters — who are you trusting?

What about the long tail of third parties?

  • VR: some excellent examples of NFC in enterprise for building security — using the phone as the reader and wristbands/tags as ID
  • SG: area we’re focussing on is the experience beyond the touch — I’ve just made a payment, what can do with that opportunity
    • discovery — suddenly made much more straightforward
    • attach a fitness service to a health product — e.g. touch a product in a supermarket
    • opportunity in combining transaction data with mobile — but do we trust the operator to look after that properly
  • JA: what’s immediately around us is disproportionately interesting than stuff on the other side of the street — there’s a big opportunity in the intersection of mobile internet content and specific locations
    • e.g in NYC at South Street Sea Port there’s a great big poster with the history, but it talks about something going to happen in 2005… There were loads of restaurants etc around but a great big poster couldn’t tell me about them

What’s the rollout going to look like and what are the blockers?

  • CM: O2 Wallet — consumer; NFC — tech
    • very active in NFC area in the enterprise
    • still no idea when they’re going to launch a commercial service

What about the developing world?

  • Vodafone Paysa? system in Afghanistan & Kenya
  • JA: Paypass has a 20 country roll-out strategy in developed nations
    • Paypass on mobile will follow that…
    • May be opportunities when you make a mobile into a micro-POS, but not primary focus

Deutsche Bahn are rolling out active phone for travel…

  • JA: NFC is flexible — can plug in either as active mobile terminal and passive tag, or active reader and passive card. Consumer experience is good in both cases.

Simon Cavell Mi-Pay: Transport or Retail only markets big enough — how would you sell to Tesco?

  • JA: time saved, seconds per transaction, etc.
  • VR: transportation systems across the UK have very clear mandates to release across the UK
  • CM: 11m contactless cards outside of London in UK
  • JH: not quite a mandate to release
    • almost all of contactless cards are being used as flash passes as there aren’t readers on the buses…
    • transport operators driven by cost reduction

Simon Rockman: my parents’ fireworks shop currently pays 1.75% on credit card transactions. What would retailers be charged for O2 Wallet?

  • CM: we’re not after the transaction revenue
    • O2 would get extra money on initial purchase of device (device would be more expensive)
    • when NFC goes onto the SIM, the manufacturer cost goes down — device just needs an aerial
    • O2 would have to buy bigger SIMs — that’s just what they do as an operator
  • SM: major block is receipt — it takes too long to produce
  • JA: consumers do want to spend large amounts on their phones
    • right now under our rules, it’s for low value transactions
    • but it’s in the roadmap to go for larger values

When will the handsets appear?

  • CM: will not launch without a choice of handsets (three or four)
    • we are talking to all tier one manufacturers
    • analysts are talking up 2012…
    • Olympic year will put pressure on people to innovate

What about switching handsets or operators? How do you handle switching transport operator credit, credit card contracts, etc.?

  • CM: hugely complex
    • O2 Wallet is all about giving everyone their brand presence
    • Applications on the SIM — can kill remotely
    • O2 has asked all operators (UK MNO Taskforce) to get around table to discuss portability
  • JH: for Barclaycard OnePulse, spent 5% of time talking about technology, 95% talking about moving to and from Oyster
    • there’s a customer management issue that no one has dealt with — what happens when someone loses their phone with six applications on it?
  • CM: first person that people phone is their operator

Who will pay?

  • CM: know that B2C will erode over time, therefore are focussing on building B2B business model
    • Banks, etc like the fact that they can deliver more information to the consumer
  • JA: try to think “what’s the next move that my organisation can take?”
  • SG: there will be a huge amount of rich data available from the intersection of transport, wallet & other transactions
    • the question will be how to monetise it?

Is there an equivalent for the iPhone App Store for NFC Apps? Is there space for the lone developer?

  • VR: Definitely space around smart posters
  • JA: don’t quite see the analogy — service discovery will take place in physical world, not electronic

Why do we need this perfect information? The information currently available is ignored by agencies etc…

  • SG: operators have now decided that they’re sitting on goldmines of customer data
    • what we really need is filters, so that data is relevant at the time
    • if I tap on a poster, I get take to different data than you do
    • with all that data, can actually deliver advertising that doesn’t feel like it — actually a useful service
  • Neil Garner, Proxama: Add a twist — rate what you get
    • then start to build up user generated content

What advantage is there over an Oyster card stuck to your phone?

  • VR: scalability — can have multiple cards in your the phone
    • have someone to manage your wallet
    • get marketing ability — receive WAP Push events
  • JH: a simple common app is top up — over the air
    • especially if you live in South London where there are less terminals
    • also benefits TfL — they need less infrastructure

Next event on October 29th — opening registrations tomorrow

November will be a little bit different — even more fun and a little more zany than usual

December: Mobile Social Networking

January: no topic decided yet…