March 31, 2009
The other day my brother called me from his cell phone. Of course receiving his call from a cell phone is not really a big event. It happens all the time. Fifteen years ago it might have been a big deal. He probably would have been calling me to say “Dude, I’m calling you from a cell phone.” It would have been a big event because airtime was fairly expensive 15 years ago and mobile phones were mostly reserved for people driving BMW’s.
Today, a cellular call from my brother is about as exciting as watching the traffic crawl along outside of my office window. But this wasn’t a typical cellular call. This call was transmitted from an iphone to my computer via Google talk. Among other things, Fring allows you to use your iphone to make calls to your instant messaging friends using an instant messager like Google Talk. Your data connection transports your voice over the internet. Thus, Fring allows you to talk all day long without using minutes from your call plan. Skype offers a similar service for Windows mobile devices. Fifteen years from now, I might think a VOIP conversation that originates on a mobile phone is mundane. Today, I am intrigued by the success of Fring despite a business model that competes with the mobile carriers that supply the bandwidth that on which Fring depends.
If a startup like Fring can deploy its service without a partnership with mobile carriers, why can’t banks do the same? Do banks really need carrier cooperation to roll out mobile NFC payments? As I mentioned in a previous posting, smart phones, cheap data plans, and mobile market places are enablers that make it much easier to offer mobile services without carrier cooperation. Fring is a terrific example of those enablers in action.
Banks may not even need device manufacturer support. A Hong Kong company is set to produce an NFC device (e.g. a sticker), that communicates with the handset via bluetooth. Thus, users can turn their phones into a smart electronic ticket, rewards card, or payment device without buying a new phone or waiting for manufacturers to include NFC support in their next handset.
So it seems the chicken and egg problem has been solved. We have some eggs. Now it is up to financial institutions to start making them hatch.
March 11, 2009
I am a believer in the potential payment opportunities afforded by Social Networks. That’s why when I read about Twitpay, I immediately went out and signed up for an account. Signing up for Twitpay was fairly simple. I followed Twitpay on Twitter, and then claimed my account on the Twitpay.me site. Twitpay sent me a direct message with my Twitpay pin. I was then able to login to Twitpay using my Twitter username and my newly assigned Twitpay pin.
Sending a payment promise to one of my Twitter friends is also fairly trivial. For example, if I wanted to send my brother a payment for lunch I would tweet something like this:
@soninlaw twitpay $5 for lunch. I can track who I owe and who owes me from the visually appealing Twitpay website.
Actually settling your payment obligations is a little more complicated. Selecting “Settle Up” from the Twitpay site takes you to the Amazon payments site and prompts you to login using your Amazon credentials. Like most people who would use Twitpay, I already have an Amazon account. However, I had never linked my checking account to Amazon, and you have to link a bank account to Amazon in order to settle your Twitpay obligations. I also had to settle twice: once with Twitpay (they charge .05 cents per payment) and once with the recipient of the funds.
The recipient of funds must also sign up for Twitpay and Amazon. Once I send the recipient a payment through Amazon, they must accept the payment (I believe this is an Amazon requirement). If they don’t accept the payment with in 24 hours, I have to go back into Twitpay and settle up again. Amazon takes a cut of the final amount delivered to the recipient.
Although Twitpay shows promise, it is not yet ready for prime time. The Twitpay site is a bit buggy. Both Firefox and Internet Explorer had problems with some of their pages and at times the site just wouldn’t load at all. In addition, I’m not convinced that managing payments via Twitter warrants the inconvenience of three sets of logins (one for Twitter, one for Twitpay, and one for Amazon) and an additional fee (Twitpay takes 5 cents for every payment). I am also not thrilled about broadcasting all of payments to anyone who cares to read them. For Twitpay to work, I have to leave all of my updates available for public consumption.
If Twitpay is to live up to its potential, it will need to provide a good reason for me to use them instead of PayPal and Amazon. As it stands today, Twitpay makes it easy to tell people I will pay them, while using PayPal, or going directly through Amazon, makes it easier to actually get people their money.