advertisement
advertisement

This is page 2 of:

The Potentially Biggest M-Commerce Obstacle: Success

September 6th, 2009

The challenge gets even more complex. The most important segment of the M-Commerce target audience are Gen-Y consumers, who are notorious for having little patience. They also put a lot of emphasis on first impressions.

Together, that spells trouble. If the first M-Commerce rollouts work well in the labs and limited trials, they will likely be launched chainwide. But if they’re popular, the performance could quickly plummet under the massive bandwidth weight. That will alienate consumers and make it an order of magnitude more difficult to move to the next phase or even maintain momentum.

The nirvana safe approach would be to wait until the infrastructure—in this case, the carrier’s networks—are strong enough to handle even an extremely successful launch. But how big is that? The same networks that have to handle all of the traffic from Sears and Macy’s also have to handle all of the bandwidth traffic from hundreds of other large retailers.

Even worse, smaller retailers—especially specialized chains—might even get into M-Commerce more quickly than their big brothers because they have less overhead and can deploy more quickly, if they want to. The situation is a little different with M-Commerce than with the AT&T/iPhone mess because there will be more like a half-dozen or more carriers involved, but that could be negated because there will be so many more retailers and consumers interested.

And there is not merely an M-Commerce online problem. All of those in-store mobile efforts—ranging from 2-D barcode, NFC, texting special offers to in-store customers and price comparison to mobile coupons, using phone-as-CRM and true mobile payments—will also make a ton of bandwidth demands.

Technically, those in-store efforts could be partially offset by having in-store customers riding atop the store’s network, but that’s unlikely for both security and logistical reasons as well as the practical matter of getting a customer to take the time to do it. They’ll likely strongly prefer to just use their existing carrier’s network. That lack of trust will go both ways.

In other words, there is the not-so-unrealistic possibility of a huge amount of traffic. Forget not that every interactive multimedia communication takes up a heck of a lot more bandwidth than a simple page download. Maybe AT&T’s pleas that there was no way that it could have been expected to anticipate their bandwidth tsunami is not so unreasonable?

Perhaps, but now that it’s happened, consumers are going to be much less likely to be forgiving a second time. Alas, just what the M-Commerce community needs: yet another reason to indefinitely delay M-Commerce deployment.


advertisement

One Comment | Read The Potentially Biggest M-Commerce Obstacle: Success

  1. Collin Says:

    When the iPhone went to Europe it was cross-carrier compatible from the beginning. As a result what you have seen is an explosive growth in the number of users in places like France where iPhone is almost 40 percent of the cell phone market. I believe that we can expect the same things here. As we see the number of smart phone users explode, M-Commerce will become a staple of everyday life and carriers are going to have to work to keep up.

Newsletters

StorefrontBacktalk delivers the latest retail technology news & analysis. Join more than 60,000 retail IT leaders who subscribe to our free weekly email. Sign up today!
advertisement

Most Recent Comments

Why Did Gonzales Hackers Like European Cards So Much Better?

I am still unclear about the core point here-- why higher value of European cards. Supply and demand, yes, makes sense. But the fact that the cards were chip and pin (EMV) should make them less valuable because that demonstrably reduces the ability to use them fraudulently. Did the author mean that the chip and pin cards could be used in a country where EMV is not implemented--the US--and this mis-match make it easier to us them since the issuing banks may not have as robust anti-fraud controls as non-EMV banks because they assumed EMV would do the fraud prevention for them Read more...
Two possible reasons that I can think of and have seen in the past - 1) Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code. 2) Also, in offline chip countries the card determines whether or not a transaction is approved, not the issuer. In my experience, European issuers haven't developed the same checks on authorization requests as US issuers. So, these cards might be more valuable because they are more likely to get approved. Read more...
A smart card slot in terminals doesn't mean there is a reader or that the reader is activated. Then, activated reader or not, the U.S. processors don't have apps certified or ready to load into those terminals to accept and process smart card transactions just yet. Don't get your card(t) before the terminal (horse). Read more...
The marketplace does speak. More fraud capacity translates to higher value for the stolen data. Because nearly 100% of all US transactions are authorized online in real time, we have less fraud regardless of whether the card is Magstripe only or chip and PIn. Hence, $10 prices for US cards vs $25 for the European counterparts. Read more...
@David True. The European cards have both an EMV chip AND a mag stripe. Europeans may generally use the chip for their transactions, but the insecure stripe remains vulnerable to skimming, whether it be from a false front on an ATM or a dishonest waiter with a handheld skimmer. If their stripe is skimmed, the track data can still be cloned and used fraudulently in the United States. If European banks only detect fraud from 9-5 GMT, that might explain why American criminals prefer them over American bank issued cards, who have fraud detection in place 24x7. Read more...

StorefrontBacktalk
Our apologies. Due to legal and security copyright issues, we can't facilitate the printing of Premium Content. If you absolutely need a hard copy, please contact customer service.