Evan Schuman's StorefrontBacktalk

For years, American technology leaders have gotten used to seeing the U.S. no longer globally technologically dominant. But nowhere is that lack-of-dominance more pronounced than with cellphone technology. That's why I saw this week's Google Android news as something that was exciting in its potential to shake the industry up. Trust me: this is one sector that truly needs a lot of shaking up. Read more...

"its payment processing assets are no longer part of the company's core business and are being considered for sale," the newsletter report said. Read more...

"As smartcards continue to penetrate applications such as contactless payment, ticketing, security/access control, and e-government, the need to simplify interactions by reducing the overall number of smartcards used by an individual will increase," the report said. Read more...

Barnes & Noble is gently testing the mobile-commerce waters, as it prepares to announce a deal on Monday to sell books, CDs and DVDs, but only on BlackBerry phones.

The deal with Digby will deliver a small version of the book chain’s site—optimized for mobile, presumably—to allow faster and easier ordering. Downside: the BlackBerry version will only be updated once a day.…

Retailers started using the credit card numbers to identify purchases with specific consumers, given that they had to store them anyway. It turned out to be a convenient link into CRM systems, especially for customers who weren't using the traditional retailer-issued loyalty card. Read more...

In a sign of the times for beleaguered RFID, when $8 billion apparel and home furnishing chain Dillards announced Tuesday that it was beginning an RFID pilot, it spent most of its short statement detailing various restrictions on its trial efforts. It’s sort of like announcing a brand-new hire by telling employees all of the things you won’t permit the new person to do.

The item-level RFID/Electronic Product Code (EPC) trial will feature “tags designed to be removed at the time of purchase. They are not required in the event that the customer wishes to return the garment. No link will be made between the garment information held by the tag and the customer’s personal information,” said the retailer’s ultra-happy news release.…

Visa on Wednesday introduced what it said was its smallest payment device ever. The Visa Micro Tag is a contactless fob designed to hang off of a keychain.

Visa has waived the requirement to have an account number embossed or printed on the device, in an attempt to boost security. The new payment device will be issued as companion devices to existing credit, debit and prepaid cards, Visa said.…

With a $6.5 million check for attorney fees and limited $10/hour hassle reimbursements for customers, TJX announced a deal Friday to make all of their consumer lawsuits go away.

The details from the show the $17 billion retailer's attempts to address consumer injuries. But given the huge scale of this breach, the compensation to any one consumer is likely to be minimal.

TJX has agreed to compensate consumers for any time they lost "as a result of the intrusion," but those calculations will assume a rate of $10/hour. Read more.

The good news is that major companies are now actively pushing mobile. The bad news is that they're pushing in different directions. The mobile phone e-commerce activities you're seeing today are going to fall victim to the same amnesia fog that envelopes all of those early Web searches done on text-based browsers.

Although the Web had been around for years, it was the graphical browser that got the industry to agree on one way to create Web pages that could fire the imagination of businesses and consumers. That defining moment has yet to hit mobile commerce. Forget design and programming issues. There hasn't yet even been broad agreement on how m-commerce is supposed to work. Let's start with simple payment.

McDonalds is experimenting with the ultimate line-buster in South Korea, where customers purchase food on their cellphones, which then ring when the order is ready.

But this trial is much more an RFID effort than a traditional mobile experiment. Most of the phone's communications capabilities and its display are barely used, with customers having to download a McDonalds application into their phone.

The implantable RFID chip story is getting more frightening, with the Associated Press now reporting a series of tests showing cancers being caused by the implants.

This is potentially significant as Applied Digital has been working aggressively to implant these chips as widely as possible. Although this isn’t likely to have a huge impact on traditional retail RFID efforts, any reliable reports of cancer-causing agents are going to raise questions. With tags being sewn into the layers of clothing, will the cancer reports become more widespread?…

In another unintended consequence example, contactless payment and mobile payment efforts seem to have stunted the growth of retail biometrics. Is this a marketing fault or the death of an idea that never had much of a chance?

A few years ago, retail biometrics had what seemed to be a very bright future. They promised superior security and a permanent CRM association. If that customer switched credit cards, moved to another state, changed their name and changed cellphone companies, the fingerprint would still allow all purchases to be associated with an individual customer.

The vendor is pledging to shrink these devices—which can both read and write in three major RFID frequencies—for near-term mobile phone and POS integration.

When NEC issued its statement in Tokyo Thursday that it has developed the world's first RFID device that can read and write tag data in the three most common RFID frequencies, it gave a boost for today's RFID deployments.

But NEC's focus was not on the new product as much as its pledge to imminently shrink the device enough so that it can be installed within mobile phones, PCs and retail point-of-sale (POS) units.

The Germany-based Metro Group, one of the world’s largest retailers and one of the strongest RFID advocates, has gone into fullscale RFID deployment. But the more interesting news is that Metro has decided to penalize suppliers who don’t properly comply.

“Some sort of levy will be imposed for each non-compliant — that is, untagged — pallet shipped by the supplier to the retailer,” said an RFID Update story. “Exactly what that levy will be is unclear. Industry hearsay puts it at two euros per untagged pallet, but METRO has not confirmed the figure.”

The story pointed out that this is in stark contrast to how Wal-Mart has been enforcing its supplier rules. Wal-Mart’s “RFID mandate was considered aggressive indeed but stopped short of threatening a financial penalty for non-compliance,” the story said.…

Visa’s partial authorization pre-paid approach got a huge boost on Thursday, with Shell Oil and its 6,000 gas stations (I wanted to say “service stations” but who are we kidding?) publicly committing to the service.

The partial payment tactic is designed for customers making a purchase that is larger than the dollars remaining on that card. Traditionally, such a payment is rejected, potentially losing the sale.

With Visa’s partial approach and Shell, the gas pumps would be programmed to only dispense as much product as the customer has on the card. (They’ve automated the old Vaudeville sales joke. “How much is it?” “Depends. How much do you have in your wallet?”) This doesn’t work for all products, but it should work well with gasoline sales.…

In mid-September, London will launch its first large-scale contactless payment trial, with some 2,000 retailers slated to participate. Although Europe has more aggressively embraced various wireless technologies than the U.S., it has sharply lagged the U.S.—and certainly parts of Asia—with contactless payment.

"As in many major cities across Europe, millions of people across in London use contactless ticketing on public transport. However, when it comes to contactless payments, challenges remain with regard to business models and partnerships," said Jonathan Collins, an RFID senior analyst with ABI Research.

The retail tendency to believe in one-size-fits-all simplicity is a failing. One needs look no further than PCI security enforcement, Web traffic analytics and retail self-checkout to see that.

But a new self-checkout study forces the issue. The study finds a tremendous success rate with self-checkout--which is fair and valid--but it didn't even consider the extreme differences between different kinds of retailers. Consider the differences between grocery chains--where self-checkout tends to be detested by consumers, who barely tolerate it--and home supply chains, where it is honestly embraced.

Contrary to some concerns that recent Wal-Mart silence about RFID means the retail giant was backing off, the Arkansas-headquartered firm is actually proceeding aggressively—and quietly, according to the latest monthly RFID report from financial management firm Robert W. Baird & Co..

“Most industry participants, and certainly most external observers, believe Wal-Mart has curtailed their RFID efforts, particularly given little in the way of new communication from the retail giant. However, we believe the primary reason for the lack of communication is the transfer of RFID responsibility to logistic operations within Wal-Mart from IT,” the report for July said. “Such a transition, along with the continued implementation of readers, is likely requiring some digestion. We view this transition as a natural progression, and are encouraged that Wal-Mart views RFID importantly enough to make it the responsibility of their day-to-day operators. We further understand that Wal-Mart has recently sent a series of letters inquiring of some vendors their lack of compliance, suggesting that their external communication efforts are targeted.”…

A hospital snack room in Michigan is an unlikely place for a fullblown item-level RFID trial coupled with biometrics, but the 24-hour needs of the facility created the need.

In this eye-opening Detroit News story, the Fast Track Convenience room at Garden City Hospital used RFID tags on all products to charge purchases by–among other methods–deducting cash value on employee ID cards. Employees who can’t grab their ID cards can instead use a biometric thumb scan. With vendor assistance, the project’s initial setup cost the hospital $25K. A story worth reading and thinking about. (Note: Look closely at the photo the paper shot on-site. Love the product-level warning label placed directly on the tag: “Remove Before Microwave Use.” More “fun with microwave oven” potential than I had anticipated with item-level tagging.)…

Tired of various challenges with RFID? A pair of Pennsylvania inventors have been awarded a patent for an RFID-like tracking system that uses light instead of radiowaves. The argument is that it would be more amenable to a crowded warehouse and that it would be less susceptable to unauthorized intercepts.

Patent 7,232,067 (Registering Multiple Similar Items with Flickers) calls for LED tags that will emit visible light, infrared, or ultraviolet. .Read more...

New figures from IDTechEx, the British RFID analysis firm, predicts RFID spending to move sharply toward active tags.

Today, IDTechEx reports, active tags represent some 12.7 percent of the RFID market, a figure that it predicts will hit 26.3 percent by 2017. If cell phone RFID modules are added in, the figures get even more dramatic.…

Wal-Mart this week continued its campaign to push RFID throughout the industry, with this powerful Money Magazine story adding new some details.

The piece has Myron Burke, strategy manager of Wal-Mart’s store innovations and operations group, discussing a recent visit to a Wal-Mart equipped with on-floor RFID tagging. He reported that out-of-stock signs were discovered in 66 of about 200 total product categories within its electronics section. “With RFID, Wal-Mart management can now alert those store associates to fix the problem spots,” the story said.…

With the $81 Billion Euro retail giant Metro Group having formally gone into full-fledged RFID deployment, a senior executive there says the efficiencies the chain saw in trials was too compelling to not deploy.

The chain has informed all of its suppliers that they need to ship all RFID pallets to Metro fully RFID tagged by October 1, 2007, said Gerd Wolfram, an IT managing director for the chain.

One of the key hurdles to full-scale RFID deployments with U.S. retailers has been low read accuracy rates, but Wolfram said that wasn't what his people found in European testing. "It's not a problem at all on the pallet level," he said, adding that pallet-level read rates were "about 100 percent."

In what is being billed as the largest production rollout of RFID in Europe, the $81 billion retail giant Metro Group has gone live with its wireless strategy.

The Germany-based chain has long been in the lead of RFID thinking and strategy globally, although it's efforts to date have been limited trials. "We are moving RFID out of the innovation labs and into working retail stores," said Gerd Wolfram, an IT managing director for the chain.

Metro, which will reportedly be using RFID products from Reva Systems in the rollout, will start with about 200 locations of its Metro Cash & Carry, Real stores, and the Metro Group distribution centers.