Change of Market Structure for Mobile Payments Services in Sweden - The Case of SMS Tickets

Mobile operators and mobile service providers like SMS aggregators and ticket providers have until now been the main actors in the provisioning of SMS tickets for public transportation services. The consumers have been charged for SMS payments using the mobile phone bill. Due to financial regulation (EU directive) mobile operators are no longer allowed to handle payments and transactions for non-telecom services without being a payment provider implying registration of the customers. In Sweden the mobile operators have joined forces and formed a joint venture that offers a separate charging solution, i.e. not using the phone bill. However, this new joint venture has in most cases not been involved in the public procurement of new ticket and payment solutions initiated 2012 by the Swedish transport companies. The outcome is that a number of new actors and constellations have entered the mobile payment business. In the paper the change of the market structure for SMS payment services in Sweden is analysed. The motivation for the research is to contribute to the understanding why mobile payment services do not take off on a large scale in Sweden although the technology and solutions are here. The case with the transformation of the SMS payment market provides insights about some of the barriers. There is no common national SMS payment solution. Users have to register accounts with a number of different payment providers. The registration process is an obstacle, the SMS payments have decreased with 50 – 90% compared to the same period 2012. We can see a fragmentation of the Swedish mobile payment service market. Due to the multitude of different solutions the incentives for both consumers and merchants to extend these payment solutions to other areas would be low

Analysis of roles and position of mobile network operators in mobile payment infrastructure

A number of different mobile payment solutions have been presented the last decade. The phone subscription with its security mechanisms are used for user identification and payments. This is the case for SMS based payment and ticketing systems that are getting more and more popular. However, there are other ways to implement a Trusted Element (TE) , where a SIM card architecture is only one. It can be in the mobile phone, as a separate integrated circuit, as an optional customer deployed plug-in device (e.g., microSD) or be running as an application on a server existing entirely as software. In this paper we analyze what roles and responsibilities different actors have in different types of mobile payments solutions. The main focus is on the implications for the mobile operator business. It turns out that new types of intermediary actors in most cases play an important role. Sometimes mobile operators are not even involved. The emergence of new payment together with other non-SIM card based TE solutions opens up for many different market scenarios for mobile payment services. --

Can mobile eco-systems for technical innovations be standardized? The case of mobile wallets and contactless communication

This paper puts focus on the application of Near Field Communication technology (NFC) to mobile payments. Uncertainties about global policies open for a variety of local business policies. Taking into account different representations of actor interaction as described by different eco-systems by different policy forums the main research question to be discussed in the paper is: Can policies or standards describing actor roles and responsibilities for technical innovations like mobile payments remove obstacles for introduction of the innovation? Different types of industry forums are not only involved in strictly technical matters but also discuss and describe visions about how a new technique might be applied in business life. They suggest different business architectures, (not only a technical architecture), where roles of different type of actors and relations between actors are outlined based on ideas about so called eco-systems. Against this background the paper first discusses how NFC enabled mobile payments currently attracts a lot of attention and identifies four possible development paths making it happen. The paper discusses and compares how global policy networks describe the technical and business architectures for mobile payments. The paper uses a business practice analytical framework and an industrial network framework to identify major problems in connecting global and local policies. Some comments on further research finalize the paper. --Near Field Communication,mobile payments,global policy,business architecture,policy forum,industrial networks,practice

The emergence of the mobile internet in Japan and the UK: platforms, exchange models, and innovation 1999‐2011

In 1999 Japanese mobile operator NTT DoCoMo launched arguably the world’s first successful mobile Internet services portal called “i‐mode”. In Europe at the same time a series of failures diminished the opportunities to attract customers to the mobile Internet. Even though similar Internet technologies were available in Japan and the UK, very different markets for services developed during the initial years 1999‐2003. When the West expected Japanese firms to become dominant players in the mobile digitalisation of services during the introduction of 3G networks, it remained instead a national affair. The dominant views of how markets for mobile services operated seemed flawed.   So‐called delivery platforms were used to connect mobile phones with service contents that were often adapted from the PC world. Designing and operating service delivery platforms became a new niche market. It held a pivotal role for the output of services and competition among providers.   This thesis sets out to answer a set of inter‐related questions: How and where did firms innovate in this new and growing part of the service economy and how are new business models mediated by service delivery platforms? It argues that innovation in the digitalised economy is largely influenced by firms achieving platform leadership through coordination of both technological systems and the creation of multi‐sided exchanges. This thesis demonstrates from cases of multi‐sided markets in operator‐controlled portals, of mobile video and TV and of event ticketing in Japan and the UK that defining the scope of the firm on the network level forms the basis for incremental innovation, the dominant form of service innovation. A parallel focus on coordinating platform technology choices forms the basis for firms to trade fees, advertisements, and user data, enabling control over profitable parts of multi‐sided value networks

Community perception of mobile payment in e-Government services

Mobile payment and e-Government are emerging topics in the research area of Information Systems. This research addresses the preferred e-Government services for mobile payment, the suitable payment methods of mobile payment, and adoption factors of e-Government services. The research derives the notion of technology adoption and related constructs, however, as no particular Information Systems adoption theory was adequate to study emerging systems of electronic payment, the research did not utilise any specific theory. Rather, the research uses the characteristics of mobile payment as revealed in the contemporary research to develop an adoption model based on user perceptions regarding mobile payments in the context of e-Government services. A survey study on the use of mobile devices to pay for e-Government services was conducted in Western Australia. The findings of this research contribute conceptually and practically by recommending suitable services and mobile payment methods. This paper also addresses the positive and negative factors impacting the adoption of mobile payment for e-Government services.<br /

Towards a Market Entry Framework for Digital Payment Platforms

This study presents a framework to understand and explain the design and configuration of digital payment platforms and how these platforms create conditions for market entries. By embracing the theoretical lens of platform envelopment, we employed a multiple and comparative-case study in a European setting by using our framework as an analytical lens to assess market-entry conditions. We found that digital payment platforms have acquired market entry capabilities, which is achieved through strategic platform design (i.e., platform development and service distribution) and technology design (i.e., issuing evolutionary and revolutionary payment instruments). The studied cases reveal that digital platforms leverage payment services as a mean to bridge and converge core and adjacent platform markets. In so doing, platform envelopment strengthens firms’ market position in their respective core markets. This study contributes to the extant literature on digital platforms, market entries, and payment

Fighting Poverty, Profitably: Transforming the Economics of Payments to Build Sustainable, Inclusive Financial Systems

The Gates Foundation's Financial Services for the Poor program (FSP) believes that effective financial services are paramount in the fight against poverty. Nonetheless, today more than 2 billion people live outside the formal financial sector. Increasing their access to high quality, affordable financial services will accelerate the well-being of households, communities, and economies in the developing world. One of the most promising ways to deliver these financial services to the poor -- profitably and at scale -- is by using digital payment platforms.These are the conclusions we have reached as the result of extensive research in pursuit of one of the Foundation's primary missions: to give the world's poorest people the chance to lift themselves out of hunger and extreme poverty.FSP conducted this research because we believe that there is a gap in the fact base and understanding of how payment systems can extend digital services to low income consumers in developing markets. This is a complex topic, with fragmented information and a high degree of country-by-country variability. A complete view across the entire payment system has been missing, limiting how system providers, policy makers, and regulators (groups we refer to collectively as financial inclusion stakeholders) evaluate decisions and take actions. With a holistic view of the payment system, we believe that interventions can have higher impact, and stakeholders can better understand and address the ripple effects that changes to one part of the system can have. In this report, we focus on the economics of payment systems to understand how they can be transformed to serve poor people in a way that is profitable and sustainable in aggregate

Future of Wireless Data Communication

This thesis develops four scenarios, illustrating the future of wireless data communication