I can understand why a mobile executive wants to replace cash with mobile money, but I’m not sure that consumers want it as much as the mobile companies do. Cash has two big (and possibly unique) advantages: it’s not dependent on technology, and, more important, it’s anonymous. I know that many of my northern European colleagues have given up cash, but I still find it very convenient and easy, especially for small transactions and other “cash transfers,” like leaving tips, where a mobile solution could be more cumbersome.
As the above article makes extremely clear, there’s one big problem facing any mobile payment solution. You need to show consumers that your solution is easier and more beneficial than using their little plastic cards. I haven’t seen anything yet that can compete.
As we learned in our Mobile Monday DC session on mobile payment last year, the real goal of financial institutions and other companies who talk about “disrupting” payment is to find a way to “monetize” the payment activity through advertising, coupons, and special offers. It’s not really about making life easier for the consumer.
It’s proven difficult to replicate the success of M-PESA in other countries (regulation seems to be a big factor), but who knows; perhaps we in the USA can duplicate the success of Kenya, Madagascar, and other similar advanced nations
On that subject, I refuse to call non-smartphones “dumb” phones, just because they don’t have multitasking operating systems or big app stores. Businesses and consumers around the world are taking advantage of these “no-frills” devices to develop sophisticated financial services and innovative advertising models, in markets.
The financial service case is particularly interesting. As the Washington Post article mentioned above reports, one of the big news items at this year’s Mobile World Congress was the success of mobile payment and banking in developing countries with low smartphone penetration. The simplicity of the technology may even be an advantage, as service providers have focused on core services without being distracted by technical features like NFC. The French company Tagattitude rolled out a mobile payment solution that uses sound to communicate among devices. Their CEO noted (quote from the Post article):
All these phones have a microphone, and all those microphones are capable of capturing data from a financial transaction,” said Yves Eonnet, the voluble chief executive of Tagattitude, showing off the clunky Nokia and several other handsets. “At the end of the day, there is no business model that is sustainable for NFC,” or “near field communication,” an advanced technology used for payments.
Don’t get me wrong; I love my smartphone (Nokia Lumia 800) and find myself quite dependent on all of those fancy features. If you’re in the business of creating mobile solutions, however, it makes sense to not forget that 75%.
I love stories like this one from the New York Times, which starts: “When Christian Oesch was a boy on his family’s hog farm, cellphones were a thing of the future. Now, Mr. Oesch tends a herd of dairy cattle and carries a smartphone wherever he goes. Occasionally he gets an SMS from one of his cows.”
Yes, cows. Swiss engineers have developed a sensor for cows that detects when they go into heat, sending an appropriate SMS about the event to the cow’s owner. This makes it easier for farmers to plan when to (as the article describes) “bring on the bull or, in about 80 percent of the cases these days, the artificial inseminator.”
What I’ve always found exciting about mobile technology is its potential to change how we live and work. Much of the mobile-related news I read, however, seems to focus on mobile devices as just one more content, entertainment, and advertising platform, not much more than a portable TV (with GPS). Of course that’s important (and profitable), but mobile devices have the potential to be so much more than that. This is why I’m excited to read about innovations like this. Here’s a solution that that truly takes advantage of the unique features of mobile devices and mobile networks to solve existing problems in ways that were previously impossible.
I’d love to hear about other solutions that use mobile tech in creative and useful ways.