The mobile wallet battle … who owns the customer?

By Katia Hilal - August 31, 2012


We are witnessing an interesting battle, reminiscent of the early 3G days, when “customer ownership” was at the heart of every discussion in the industry. Would the operator continue to own the customer by funneling all the services through its branded portal? Or would the content and service providers succeed in building a direct bridge to the customer, turning the operator into a dump pipe?

Interestingly, this same question has resurfaced with the boom of the Mobile Payments and Mobile Wallet industries. While traditional payment players (banks), internet players (PayPal, Google) and manufacturers (Apple) are marketing their own B2C services and promoting their own mobile wallets to end consumers, the mobile operators are fighting back, promoting their operator centric wallet, such as Isis in the US.

The business model for each of these players is very different, while some operators are betting on the mobile payments market to capture new revenues from the payment transactions, Google seems to be subsidizing the customer payment in order to gain valuable customer information (see this interesting blog post). Driven by regulatory constraints, some operators (Orange France) have chosen not to interfere with the payment transaction itself but to leverage the NFC SIM card space rental to take their share of the business.

No one can predict with certainty who will win the battle, but the operator’s experience from 3G and content services should give us a hint as to how the market will end-up looking.

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