Sony may not be taking on Apple and Samsung on the smartphone front, but it still plans to compete with the tech giants on the mobile payments front in Asia.
Sony plans to use its contactless payment technology to make ground in the public transportation industry across Asia. This system, known as FeliCa, relies on two forms of technologies to make it viable. This can either be chips embedded in smartphones or plastic cards with chips embedded in them. Sony plans to implement this technology in train systems in Indonesia as early as the spring, Bloomberg reported.
"Our approach is different from Apple’s,” Kazuyuki Sakamoto, a Sony senior general manager in charge of FeliCa operations. said in an interview with Bloomberg. “Without real-life situations where the payments can be used, it doesn’t matter how many handsets you have out there."
Sakamoto said that regions like Southeast Asia have the potential to be a major market for technologies such as FeliCa, particularly as the regions upgrade their railroads and invest massive amounts of money into infrastructure. And as train stations get upgraded, upgrading to consumer-friendly technology can be a major motivator for those transportation networks.
One region that already has bought into Sony chips in its public transportation system is Hong Kong’s Octopus system, which is used in trains, busses and convenience stores.
"Apple Pay and the like are now getting started overseas, but we’ve been offering this service for more than 10 years,” Sakamoto said. “Start with railway passes, then progress to merchants."
He also said Sony has plans in the work to made FeliCa’s technology easier to onboard, which may mean having the technology embedded in more software that allows more consumers and merchants to have the opportunity to take advantage of contactless payments.
But like Apple Pay has seen in the U.S., there still is a lag in mobile payments adoption among manufactures wanting to make the devices, financial companies wanting to support the technology, and merchants accepting the payments. After all, Apple Pay is used for just 1 percent of retail transactions, according to Aite analytics, which suggest adoption is going to be a slow burn over the next few years.
But Asia is also the market that has been projected to be a hot bet for innovation for mobile payments. IDC research shows that the market could double to $1 trillion worldwide by 2017. Japan and South Korea have been two regions that have been particularly hot for mobile payments adoption — as well as emerging countries that are buying more and more into smartphones.