Research Seminar on Telecommunications Business II Mobile Payments by Markus Kalliola

1
Research Seminar on Telecommunications Business
IIMobile Paymentsby Markus Kalliola
2
Mobile Payments
Index

1. Introduction
2. Technologies
3. Payment methods
4. Future Vision
5. Conclusions

3
Mobile Payments

• Introduction
• mobile payment transaction
• first commercial implementation 1997
• rapid grow towards present day, but no
  breakthroughs
• open standards under development
• remote or local payment

4
Mobile Payments

• Technologies
• Phone call
• 1997 Sonera implemented vending machine
• remote service
• Advantages
• easy to use
• reliable
• Disadvantages
• require an unique number for each service
• operator has to do the billing
• example
• paybox

5
Mobile Payments

• Technologies
• SMS
• short message service
• remote service
• Advantages
• easy to use
• cheap
• Disadvantages
• delay
• security
• Example application
• Helsinki City Transport

6
Mobile Payments

• Technologies
• Browsing technology
• interact with Internet- and intranet-based
  services
• WAP, Wireless Application Protocol
• Routing

7
Mobile Payments

• Technologies
• Browsing technology
• WAP
• WAP 1.0 was optimized for the early WAP-phones
• Security problem in gateway
• WAP 2.0 and TCP/IP

8
Mobile Payments

• Technologies
• Browsing technology
• WAP
• Advantages
• Implementation near to the Internet model
• Modern phones support WAP
• Disadvantages
• Bad reputation
• Not familiar to the users
• Business model expensive
• Forms are hard to design
• Third party included
• Huge among of bugs
• Different versions and implementations
• Example
• Vodafone mpay

9
Mobile Payments

• Technologies
• Browsing Technology
• Java MIDP
• Mobile Information Device Profile
• Developed as a Java Community Process
• Some technical aspects
• Applications extend MIDlet class
• MIDlets offer portability
• Uses constant databases
• Mapping through abstract command
• OTA, Over-The-Air, support
• HTTP and HTTPS support
• Push technology
• End-to-End Security with PKI

10
Mobile Payments

• Technologies
• Browsing Technology
• Java MIDP
• Advantages
• Good technical qualities
• Broad knowledge among developers
• Lower network and server load
• Internet enabled, java
• Cheap to download
• Disadvantages
• Third party included
• Good for services and games not for payments
• Competition
• Example
• Valimo solution

11
Mobile Payments

• Technologies
• Bluetooth
• Danish King Harold Bluetooth
• Created by phone manufacturers
• Technical aspects
• Low bandwidth connection
• Unlicensed at 2.4GHz ISM band
• 1Mb/sec
• Link module and radio module
• Advantages
• Disadvantages
• Example
• CASPAY

12
Mobile Payments

• Technologies
• Infrared, IrDA
• 1993 Infra-red Data Association
• Technical aspects
• Hardware and Software
• Advantages
• smallest, cheapest, fastest
• Disadvantages
• not designed for payments
• Example
• NTT DoCoMo 3G IrFM

13
Mobile Payments

• Technologies
• Payments with PDA
• 802.11 IEEE, wireless LAN
• Not very interesting for Mobile environment
• Solutions exist only for Business to Consumer

14
Mobile Payments

• Technologies
• Mobile wallets
• A tool in mobile phone
• Offers a secure storage for personal information
• Makes buying easier and faster
• Needs a communication channel

15
Mobile Payments

• Technologies
• Single SIM with PKI
• Dual chip
• Dual slot
• Advantages
• Disadvantages

16
Mobile Payments

• Technologies
• RFID, Radio Frequency Identification
• Future or past?
• Technical aspects
• Advantages
• Disadvantages
• Pilots exist

17
Mobile Payments

• Payment methods
• Prepaid
• SIM, Smartcard
• Virtual accounts
• Phone bill
• Debit card
• Credit card

18
Mobile Payments

• Future Vision by Mobey Forum
• Mobile payment should use existing clearing and
  authentication solutions
• Three way to implement
• The development trend
• Revolutionary?

19
Mobile Payments

• Conclusions
• A lot of nice technologies why dont they make
  breakthroughs
• Market demands for future
• Banks or other clearing houses
• Retail or other end-sale parties
• Operators
• Users