GSMA Calls for Pay-Buy-Mobile Handsets

MACAU,China, Nov. 17 /PRNewswire/ -- The GSMA, the global trade group for the mobile industry, today called for full NFC functionality -- including the standardised 'Single Wire Protocol' interface -- to be built into commercially available mobile handsets from mid-2009, in order to ensure that consumers can reap the benefits of mobile payment services as soon as possible.

The GSMA's Board -- meeting this week inMacau,China -- fully supports the need for the ETSI* endorsed 'Single Wire Protocol' standard to provide the interface between the Universal Integrated Circuit Card (UICC, or SIM card) and the embedded NFC chipset within the handset. The NFC chip can communicate with existing contactless readers to deliver a wide range of secure, interoperable and transparent services, such as credit and debit payments. A series of operator trials -- under the GSMA's 'Pay-Buy-Mobile' initiative -- have demonstrated that consumers can use UICC-based NFC handsets to quickly, easily and securely pay for goods and services in shops, restaurants and train stations.

Rob Conway, CEO of the GSMA, said, "There is no doubt that there is a huge latent demand for a large variety of mobile transaction services, of which there is universal interest in proximity payments, as trials across the world have already shown. We are committed to ensuring that mobile payment services are delivered as efficiently and cost effectively as possible. But this will require device manufacturers to make sure that the vast majority of commercially available handsets incorporate the Single Wire Protocol and Near Field Communications features as standard.

"Doing so would enable the industry to leverage significant economies of scale, and ensure greater accessibility of NFC services for mobile users," added Conway.

This call for handsets is supported by recent operator trial results, which indicate a growing consumer demand for mobile payment services. Trials are underway across eight countries involving nine mobile operators as part of the GSMA's Pay-Buy-Mobile initiative. Further pilots are planned across 14 countries by 15 mobile operators.

InTaiwan, in a trial of over 200 users, FarEasTone found that 90% of people felt positive toward to this new service. 80% of people were satisfied that the service is secure, and 40% said they would switch their monthly spending to a mobile credit card service.

Seven banks and four mobile operators -- including Orange and SFR -- involved in the "Payez Mobile" trial inFrance have announced the results of trials conducted with almost 500 sales outlets and nearly 1000 triallists. Over 90% of triallists said they found contactless mobile payment convenient, fast, and easy to use. In addition, 94% declared that they would recommend it to their friends and family. Merchants welcomed the possibility of offering to their customers an innovative payment solution, with over 80% saying they appreciated the speed and cutting-edge appeal of mobile contactless payment.

Equally, in Korea, SKT and KTF found that m-transportation was very popular with users, and this is likely to translate to other mobile payment services. Approximately 450,000 users of the "T-money" service were quick to adopt the service as it is convenient and compatible with existing readers. According to KTF's survey, 85% of m-transportation users indicated satisfaction levels were 'very high'. 85% of them believe that using a contactless mobile phone is much more convenient than getting their wallet out to use public transportation, and would continue to use the mobile service. "T-money" attracts users not only for the public metro and bus, but also for small transactions such as buying goods from convenient stores by simply tapping on the contactless readers.

In July the GSMA on behalf of operators issued a detailed Device Requirement** document to a wide range of vendors and suppliers in the 'Pay-Buy-Mobile' ecosystem. 37 key players responded, giving a clear picture of the core requirements for any SWP/NFC device.

Supporting Quotes

"As one of the first operators to trial mobile payments, we've seen first-hand, the willingness of consumers to adapt to this new payment channel which is very much dependent on the availability of NFC handsets and the associated ecosystem," said Kris Rinne, Senior Vice President, Architecture and Planning AT&T. "We hope that the GSMA's delivery of a consolidated set of minimum requirements will accelerate the worldwide delivery of NFC-enabled handsets to the market."

"We observed great potential for mobile payment services through T-money. We believe it is changing the behaviour of users and expect it to see significantly increasing demand over time. Supportive actions and collaborations with banks and especially handset vendors will help to speed up this demand," said Sang Ryul Lee, VP of Transaction Business Group, KTF, a leading HSPA operator in Korea.

Mung-Ki Woo, VP Payment and Contactless at Orange, said, "Orange has run trials inFrance,Spain and the UK which show a consistent appeal to consumers in all countries for SIM-based, operator managed, mobile NFC services. For Orange, mass deployment is now mainly dependent on handset manufacturers providing a large range of adequate handsets."

Dr Nikolai Dobberstein, Head of Products and New Businesses of Maxis Communications, said, "As Malaysia's leading mobile operator, Maxis is very enthusiastic about enabling mobile payments via NFC and leveraging the growing contact-less payment infrastructure inMalaysia. We are collaborating with strong partners on this initiative, Maybank and Visa International and our focus is to establish a mobile NFC eco-system for commercialization which provides Malaysian customers with accessible & easy to use mobile payments."

"We are pleased to be part of this pioneering and innovative project trial as it will further simplify payment transactions and in the long run, help spur the growth of mobile commerce our country. Meanwhile, we are anticipating that vendors will incorporate NFC functionalities as a default feature in their handsets so more people can enjoy the technology," said Napoleon L. Nazareno, Smart President and CEO.

Ross Fielding, Executive Director, Telstra Product Management, said, "Telstra recently conducted a contactless mobile payments pilot with Australia's National Australia Bank and Visa and early results from the trial are positive. Findings from an online survey of participants in the pilot found a high propensity to use the service and further advocate its benefits to friends and family."

"We see potential in the market for NFC based mobile payment services, which can both be seen from our customers and banks' feedbacks. We believe that the customers may gradually adapt our services once the supporting handsets are on the market," said Cenk Serdar, Chief VAS officer of Turkcell.

     Notes to Editors:

     Countries where trials are being held:
      -- Australia
      -- Canada
      -- France
      -- Japan
      -- Korea
      -- Malaysia
      -- Taiwan
      -- Turkey
      -- USA

The GSMA has published two white papers on http://www.gsmworld.com, one of which sets out several business models that can support a mobile payment service and one of which sets out version two of the GSMA's technical guidelines for NFC.

The Pay-Buy-Mobile initiative builds on the infrastructure of the major credit card companies, which have developed specifications to ensure global interoperability between contactless chip cards and point of sale terminals, regardless of manufacturer, the financial institution and location of transaction.

The GSMA is working closely with leading financial intermediaries and banks to promote globally interoperable transaction solutions. Both MasterCard and VISA are supporting the trials with their PayPass and Visa payWave features respectively, that enable NFC-equipped phones to effect payment transactions at secure contactless point of sale terminals.

In September 2008 the GSMA signed a Memorandum of Understanding with EMVCo, operated by JCB International, MasterCard Worldwide and Visa, Inc, to share information.

LG, Motorola, Nokia, Sagem and Samsung are among the handset makers developing phones for NFC-enabled mobile payment services.

Gemalto, G&D and KEBT are among the UICC card suppliers supporting NFC-enabled mobile payment services.

Vivotech and Harex are among the companies developing NFC-enabled readers that support NFC-enabled mobile payment services.

The information received by the GSMA has been incorporated into a second version of a Device Requirement Document, which will provide a common set of requirements for SWP/NFC devices. This is intended to make it easier for manufacturers to mass produce devices and to improve global interoperability of SWP/NFC handsets.

    * ETSI: European Telecommunications Standards Institute
    ** GSMA's Device Requirements:

    Operators taking part in the GSMA's 'Pay Buy Mobile' initiative are:
    AT&T
    Brasil Telecom
    Celcom
    Chunghwa Telecom
    CMCC
    EITC
    Etisalat
    Far Eastone
    GlobeTel
    IMC Island
    Kall
    KPN
    KTF
    Maxis
    MCI
    Meteor
    Mobicom
    MobilKom Austria
    Mobitel d. d.
    MTN
    MTS
    NTT DoCoMo
    Orange
    Partner
    Pelephone
    Rogers Wireless
    SFR
    SingTel
    SingTel Optus
    SK Telecom
    SMART
    Softbank Mobile
    Starhub
    Swisscom
    TDC
    Telecom Italia
    Telefonica O2
    Telenor
    TeliaSonera
    Telstra
    Turkcell
    Vimpelcom
    Vodafone
    Wind
    Zain

About the GSMA:

The GSMA (The GSM Association) is the global trade association representing more than 700 GSM mobile phone operators across 218 countries and territories of the world. In addition, more than 200 manufacturers and suppliers support the Association's initiatives as key partners.

The primary goals of the GSMA are to ensure mobile phones and wireless services work globally and are easily accessible, enhancing their value to individual customers and national economies, while creating new business opportunities for operators and their suppliers. The Association's members serve more than 3.4 billion customers -- 85% of the world's mobile phone users.

For more information, please visit http://www.gsmworld.com

SOURCE The GSM Association

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