Session 3: Igniting Mobile Payments – Who’s Doing What and Where’s the Ignition

Session Highlights

– How consumers use mobile phones today and what their expectations are for how they should be used

– What are the barriers to merchant and consumer adoption

– What is the mobile payments business case

– What is the operators’ role in driving mobile payments in the United States

Mark Selby, VP of Industry Collaborations for Nokia (pictured, center right), garnered huge laughs when he reminded institute participants not to forget about the consumer when innovating in the cloud. Not the technical cloud, but the one created by the sea of Post-it notes that typically emerge during the innovation process.

Promoting new products in the payments space is no longer like a game of bowling, Selby said, where the marketers are the ball and the consumers the pins.

“The game has changed,” he said. “We are no longer there in 10-pin bowling. We are standing in a pinball machine. The logic is similar. You have the ball. You have control over the ball. Once you send it up to the top, you’ve lost control. The market has control – social networking, consumer product reviews… The only control you have is once the ball falls to the ground, and you can flip it.”

Also producing chuckles was Selby’s recollection of Mobile World Congress and the non-traditional players who began popping up over the years when their own sectors were experiencing financial turmoil.

“In 2000, an interesting thing started to occur. The music industry showed up… to explore how mobility could help,” he said. “Five years later, the entertainment industry showed up. Who turned up this year? The banks. And the conversations were identical to the ones we had five or 10 years ago.”

He went on to touch on the debate during the previous panel regarding mobile security, emphasizing his belief that there was no need for a secure element.

“There are reasons for a secure element associated with control,” he said. “These can either be on the device on the SIM card or elsewhere. The point is many people would like to the have that so they can control the keys. When we look at the secure element, this is not being driven by engineers. This is being driven by parties who wish to have access to all data, who realize its value.”

When it comes to security, Selby pointed out there’s more to guard than just the obvious point of entrance. As an example, he joked that a house could have the most secure door locks in the world, but that he could still break in using his Nokia phone just by throwing the device at the window.

Meanwhile, Intuit Director of Strategic Mobile Initiatives Omar Green in his overview of Intuit GoPayment noted that encryption and underwriting accounts have in his view helped distinguish the product from competitor Square. He did acknowledge that when Intuit focused on bringing GoPayment to field-service workers and hobbyists, Square ignited in a sector the company hadn’t considered – lower-volume customers who “didn’t understand merchant accounts or interchange, but they needed something to take their cards and someone to do it.”

Looking at new possibilities for NFC was Humphrey Chen, Executive Director – New Product Technologies for Verizon Wireless. He discussed how mobile NFC might be used not only for expediated payments, like at Starbucks, but also for employee T&E tracking or healthcare management.

Richard Oliver, EVP at the Federal Reserve Bank of Atlanta, and Kristen Purcell, Association Director of Research at Pew Research Center, both presented their studies on mobile payment and Internet usage, respectively. Read more on the reports below:

– U.S. Adults and Mobile: Pew Internet 2011 Data Preview

– Exclusive Interview: Fed’s Predictions for the Future of U.S. Mobile Payments