4G mobile payment ecosystem starts to take shape

NEW YORK, USA: Mobile payment systems present unique growth opportunities for handset manufacturers and mobile operators, and these opportunities should increase as operators deploy 4G networks and services, according to the latest report from the Heavy Reading 4G/LTE Insider, a paid research service of TechWeb's Light Reading.

Mobile Payments: Opportunity in the Run-Up to 4G evaluates the current state of mobile payment systems in terms of adoption rate, applications they are supporting worldwide, and the major components of emerging mobile payment system architectures.

It identifies and analyzes companies that are offering various technologies and/or platforms targeting customers that want to implement a "mobile payment" system and the components that enable such a system. The report also evaluates those companies' current offerings and discusses the challenges they face as they pursue opportunities as mobile networks progress toward 4G implementation.

"The idea of mobile payment systems began taking shape in the early 2000s, primarily overseas in developing African and southeast Asian economies," notes Aileen Arcilla, research analyst with Heavy Reading 4G/LTE Insider and author of the report. "Since those first deployments, other developments have made operators consider the growth opportunities of supporting mobile payments."

Despite the overall success of mobile services, handset manufacturers, mobile network operators (MNOs), and mobile virtual network operators (MVNOs) face challenges in finding ways to take advantage of other growth opportunities, Arcilla says.

"MNOs and MVNOs must determine how to sustain their businesses in light of declining rates for consumer voice and data services, while handset manufacturers seek to capitalize on the next great feature to increase their share in a market driven by volume sales," she adds. "The emergence of mobile payment systems presents a significant growth opportunity."

Key findings of Mobile Payments: Opportunity in the Run-Up to 4G include:
* The mobile payment system opportunity is trending upward, but the vendor space remains fragmented and diverse.
* Numerous ways to enable a mobile payment system have emerged, reflecting the lack of platform/solution standardization.
* Credit card companies struggle to determine their "mobile payment system strategies" as alternative payment mechanisms emerge that limit/excludes the need for their role.
* Financial institutions can greatly benefit from mobile payment systems from a cost perspective but will need to work on maintaining their customer base.
* Mobile network operators view the mobile payment system opportunity as a revenue generator in light of declining rates for voice and data traffic.