Philips has been peddling its SmartMX contactless
payment system for a while, but things are really looking up now that SanDisk wants to get in the game. They're now working with Philips to include the SmartMX tech in their TrustedFlash microSD cards, allowing any phone with a microSD slot to make payments. The details are a bit slim, but it looks like you would have to buy TrustedFlash cards loaded with "credits" in order to make payments, which frankly doesn't sound like much of a step towards convenience for consumers, but rather a boon to SanDisk and Philips who will no doubt be taking a cut. However it works out, the industry is clearly marching towards contactless and phone-based payments, let's just hope it works out as an actual plus for the people who are carrying around the phones and making the contactless payments.
[Via
Gadget Review]
posted May 6th 2006 8:05AM
As someone who uses a mobile phone equipped with a FeliCa IC chip every day for the trains, food, shopping and entertainment I'm yet to figure out how anyone directly makes money from it.
I charge in increments of 1,2,5 or Y10(,000) - (That's about $100USD for those of you playing at home), and that's exactally what I get.
There's no 'taxes' or 'fees', the service is completely free. I assume the profit goes to the provider (DoCoMo) in sales of handsets boasting 'equipped with IC', and then some to retailers who supply the hardware to use it at their stores on the idea that people will buy more with their Mobile Wallet rather than using real cash.
As for these cards it seems rediculous to buy a card each time to want to charge up. I would imagine that you would be able to 'charge' your card atleast somehow. you'd probably have to do this dodgily online with serial numbers as the cards would have limited~no credit communication between the handset. This ofcourse means that the only way of checking your balance would probably be to go to some WAP site etc.
The more I think about this the worse the idea sounds. Well lets just hope they do it (if they actually -do- do it) well. End rant.
Geez, that sounds too unwieldy to be at all useful. If the card can be recharged via the phone, or automatically recharged, it might be useful for the consumers. But I doubt it. At least not if it's rolled out as described in the link.
Felica-based solutions are nice, but enough people have to be convinced to use the service, and merchants have to be convinced to add yet more equipment. I doubt either will be the case in the US, given the way phones are marketed and sold there. Anyway, even in Japan, Felica and osaifu-keitai seem worthless outside of the mega-cities, except as a phone.
I think in this case the credit-card / bank-card providers have the upper-hand at the moment. They can seed their existing customer base with contact-less payment cards as a means of driving retailers to invest in the equipment. But I don't see this as enough of an improvement over just using an ATM card for making purchases, to get consumers and merchants to change their current practices.
As for how money is made off of Felica or osaifu-keitai purchases...if it's anything like credit cards, the retailer pays a fee (maybe 1, 2%) for each transaction. The retailers bank on your buying more stuff, and the providers make money off of the interest in the money you use to charge your account (or interest / transaction fees where the osaifu-keitai debits from your credit card). Which is basically how debit cards are used in the US...