Deliver A Song

Do you even know what M-Commerce is?

Well you better learn fast. Predictions in Europe for
M-Commerce, the second largest market behind Asia, are for a
spend of €7.4 Billion in 2006 that’s over $8 Billion. That’s
twice the predicted spend of traditional web services!

So what is M-Commerce? It’s very simple, mobile / cell phone
based sales. Usually relating to content such as games,
wallpaper, ringtones etc. But there’s much more to it than that.
Keep reading.

What’s the big deal? More people own a mobile phone than a PC,
they’re better integrated in to daily life. People are very
comfortable using them. They are now in fact heavily relied
upon, as the phone feature is only a small part of what can be
perceived as a miniature multi-purpose multi-capable portable
computer.

Mobile Growth Mobile growth already outstrips all other
communication channels. Half of all Americans are mobile phone
subscribers. In the UK the ownership of a mobile phone is
equivalent to 1.5 phones per head of population. According to
research, mobile content services will be worth $121 Billion
worldwide by 2008. White label distribution of ringtones,
images, games and other promotions will drive up to 1/5th of the
revenue generated. It’s estimated 1.5 Billion people worldwide
own a mobile phone.

With more and more technology add-ons to tempt the consumer
these devices are now Cameras, MP3 players, game consoles, voice
notepads, picture albums, diary organiser, PDF readers etc etc.

In fact I’m writing this article on my PDA / Phone whilst sat in
the sunshine in the garden. With two taps on the screen I can
hook up to my home wireless network and check my emails, browse
the net, update my Blog or edit and publish article submissions
on one of my sites all via broadband.

We are not that far away from always on Net connections. Once
this arrives it will allow anyone to do this almost wherever
they are. Certainly in the major cities around the world. When
this happens there will be a third Internet boom as Joe public
try’s out the Net connection again that was always too shoddy to
use in the past.

And what will they want? Content! ringtones, wallpaper, games,
MP3’s etc

But I’m getting ahead of myself. The real money isn’t even going
to be made via a Net sale. The real money will be made via
SMS(Short Message Service), MMS(Multimedia Messaging System) and
this ones a goldmine…Micro payments.

Recent research has shown a doubling of worldwide revenue from
streaming TV and sports bulletin subscriptions. 380 million
people worldwide are expected to subscribe to similar services
in 2005. Including TV show bulletins particularly from ‘reality
TV’ shows, News bulletins or Soap updates.

Big deal you’re not a TV network how can you make some money out
of this boom? I’ll go into that in a second but first I want to
go back to those Micro payments I mentioned earlier. The real
gold dust.

Micro Payment Profits Micro payments have been around for a
while here in the UK. A smaller land mass has allowed for a
quicker rollout of mobile technologies here. Nationwide Network
coverage is easier to achieve. I believe the first example in
the US to take it mainstream was by the ‘American Idol’ show.
Viewers voted for the acts on the show via their mobile phone.
They where then charged a small premium for their vote on top of
their networks regular SMS charge. Think of the millions of
votes that the show attracted and the revenue generated.

That’s micro payments in action.

The beauty of this is that people don’t feel like they’re
spending money because they don’t need to whip out their credit
card, it’s an easier payment method, usually involving a simple
text to a small number and the payment is small. They also trust
their mobile for making payments unlike an online transaction.

Any payments made will appear on their next phone bill. People
are already used to paying in this way, they’re comfortable with
it. Whether it’s to vote for an act on a TV show, for a game
download or to grab the latest ringtone.

What have you got that you could take micro payments for? You
should be considering how you can utilise your current website
network to tap into this market. Do you offer subscriptions? Is
there a service you offer that you could convert to
subscriptions.

How Can You Make Some Money? Here’s a quick example. Your
newsletter. Would your subscribers be willing to pay a small
premium to have your newsletter delivered directly to their
mobile? Wherever they are, without the need to be sat in front
of a PC. Thus bypassing the SPAM filter problem and guaranteeing
they receive your valuable content. You could sell it as
valuable service for your customers with added content not
available on your site or via your regular newsletter.

Or offer them up to the minute breaking news in their industry,
which they receive as it breaks and not when they check their
email five hours later when it’s to late to take action.

Digital artists sell your wallpaper designs direct to the
consumer via the mobile phone. New bands forget the record
company contract sell your music via MP3’s direct to the
consumer. Investment advisors get subscribers to your ‘Hot Tips’
bulletins. Store owners offer a sale bulletin service etc etc

The Future The omnipresent Google are moving forward with major
mobile initiatives. Spending vast amounts of money to stake a
claim in this fledgling market. There’s the mobile version of
Froogle for one and they’ve also developed mobile business
listings specifically for the potentially huge ‘local search’
market. They also offer a free SMS based information service
http://www.google.com/sms/ and http://www.google.co.uk/sms/

Another major company Real Networks, creators of Real media
Player, recently bought Finnish mobile phone game developers Mr
Goodliving for $15M. Essentially buying a back catalogue of high
profile mobile games.

NTL a cable TV company here in the UK recently streamed the
Grand National, the biggest race horse meet here in the UK, live
to Nokia owning subscribers.

This is early days and that’s a small glimpse of the future.

The M-Commerce Market is very different from the online market
in terms of what content consumers are currently paying for. The
biggest revenue generators online, 70%, are porn and dating
sites. A similar percentage via mobile is for games, music and
video. Films, that’s another one, Nokia are now distributing
Hollywood movies via memory card!

The technology specifically 3G, an always on network with
transfer rates of 384kbs a second, is here and trickling into
mainstream culture. These devices are in fact capable of
1920kbs. Compare that to GPRS at 56kbs. You don’t need these
speeds to take advantage of this market but you should keep them
in mind to realise the full potential of where mobile
communication is going.

Here’s a brief, eye opening, wish list from consumers for future
mobile phone payment abilities:-

10 Use your mobile as a key 9 Marketing communications 8 Retail
checkout payments 7 Vending machine payments 6 Flight check in 5
Credit / debit cards 4 Season tickets 3 Loyalty cards 2 Parking
Meter payments 1 Mobile Coupon redemption

Getting Started How do you Accept Payments? Reverse SMS is very
popular at the moment. It provides the ability for you to direct
consumers to secret download links on your site whilst taking
payment through a premium SMS message. Another method known as
‘WAP Push’ sends a link via SMS that automatically launches when
the message is opened. You will need to set up your own WAP /
SMS Gateway on your server which will require server
administrator access to use both these solutions.

But there are other easier solutions a number of websites are
springing up that allow you to upload your content available for
download, games, video, wallpaper, MP3’s etc . A small fee is
taken from each paid download by the SMS Gateway company.

I’ve compiled a list of useful links to a number of the above
solutions and I’ve also thrown in a couple of links to
‘mobaphile’ websites were you will find some interesting
predictions for the future development of mobile phones along
with some real off the wall ideas for making money with mobiles.
http://www.how-to-make-money-online.info/m-commerce-resources.php

To paraphrase a strap line ‘The future’s bright the future’s
mobile’

Darren Yates
http://www.articlesbase.com/ecommerce-articles/mcommerce-twice-the-cash-value-of-ecommerce-1093.html

M- COMMERCE AND ITS APPLICATIONS

Dr. (Mrs).R. RAJESWARI, Reader in Commerce,

Sri Sarada College for Women (Autonomous), Salem -16.

 INTRODUCTION    

                “Mobile Commerce is any transaction, involving the transfer of ownership or rights to use goods and services, which is initiated and/or completed by using mobile access to computer-mediated networks with the help of an electronic device.”

DEFINITION

 “Mobile Commerce is the use of information technologies and communication technologies for the purpose of mobile integration of different value chains an business processes, and for the purpose of management of business relationships.”

– Webagency, 2001

MOBILE DEVICES

M-commerce is not just about using mobile phones as end user devices. The following list gives an overview of different kinds of mobile devices.

• Mobile phone
• PDA (Personal Digital Assistant)
• Smart phone-the smart phone combines mobile phone and PDA technology into one device.
• Laptop
• Earpiece (as part of a personal area network)

M-COMMERCE VERSUS E-COMMERCE

In comparison to e-commerce, m-commerce offers both advantages and disadvantages.  The following list summarises the advantages of m-commerce:

¨      Ubiquity: The use of wireless device enables the user to receive information and conduct transactions anywhere, at anytime.

¨      Accessibility: Mobile device enables the user to be contacted at virtually anytime and place. The user also has the choice to limit their accessibility to particular persons or times.

¨      Convenience: The portability of the wireless device and its functions from storing data to access to information or persons.

¨      Localization: The emergence of location-specific based applications will enable the user to receive relevant information on which to act.

¨      Instant Connectivity (2.5G): Instant connectivity or “always on” is becoming more prevalent will the emergence of 2.5 G networks, GPRS or EDGE. Users of 2.5 G services will benefit from easier and faster access to the Internet. 

¨      Personalization: The combination of localization and personalization will create a new channel/business opportunity for reaching and attracting customers. Personalization will take the form of customized information, meeting the users’ preferences, followed by payment mechanisms that allow for personal information to be stored, eliminating the need to enter credit card information for each transaction.

¨      Time Sensitivity – Access to real-time information such as a stock quote that can be acted upon immediately or a sale at a local boutique.

¨      Security – depending on the specific end user device, the device offers a certain level of inherent security.

The following list summarises the disadvantages of m-commerce:

1. Mobile devices offer limited capabilities (such as limited display).  Between mobile devices these capabilities vary so much that end user services will need to be customized accordingly.
2. The heterogeneity of devices, operating systems and network technologies is a challenge for a uniform end user platform.  For this reason, standardization bodies consisting of telecommunication companies, device manufacturers and value added service providers integrate their work.
3. Mobile devices are more prone to theft and destruction.
4. The communication over the air interface between mobile device and network introduces additional security threats.

AREAS / USES OF M-COMMERCE

In the current commerce industry, mobile commerce or M-Commerce has been entered in finance, services, retails, tele-communication and information technology services. In these sectors, M-Commerce is not only being widely accepted but also it is being more used as a popular way of business/ commerce.

• Finance Sectors
• Telecommunication Sectors
• Service / Retail sectors
• Information Sector

M-COMMERCE APPLICATIONS

The general m-commerce applications are:

1. Mobile ticketing

Tickets can be sent to mobile phones using a variety of technologies. Users are then able to use their tickets immediately by presenting their phones at the venue.

Tickets can be booked and cancelled on the mobile with the help of simple application downloads or by accessing WAP portals of various Travel agents or direct service providers.  Mobile ticketing for airports, ballparks, and train stations, for example, will not only streamline unexpected metropolitan traffic surges, but also help users remotely secure parking spots (even while in their vehicles) and greatly facilitate mass surveillance at transport hubs.

2. Mobile vouchers, coupons and loyalty cards

Mobile ticketing technology can also be used for the distribution of vouchers, coupons and loyalty cards. The voucher, coupon, or loyalty card is represented by a virtual token that is sent to the mobile phone. Presenting a mobile phone with one of these tokens at the point of sale allows the customer to receive the same benefits as another customer who has a loyalty card or other paper coupon/voucher. Mobile delivery enables:

• economy of scale
• quicker and easier delivery
• effective target marketing
• privacy-friendly data mining on consumer behaviour
• environment-friendly and resources-saving efficacy

3. Content purchase and delivery

Currently, mobile content purchase and delivery mainly consists of the sale of ring-tones, wallpapers, and games for mobile phones. The convergence of mobile phones, mp3 players and video players into a single device will result in an increase in the purchase and delivery of full-length music tracks and video. Download speeds, if increased to 4G levels, will make it possible to buy a movie on a mobile device in a couple of seconds, while on the go.

4. Location-based services

Unlike a home PC, the location of the mobile phone user is an important piece of information used during mobile commerce transactions. Knowing the location of the user allows for location based services such as:

• local maps
• local offers
• local weather
• people tracking and monitoring

5. Information services

A wide variety of information services can be delivered to mobile phone users in much the same way as it is delivered to PCs. These services include:

• news services
• stock data
• sports results
• financial records
• traffic data and information

Particularly, more customized traffic information, based on users’ travel patterns, will be multicast on a differentiated basis, instead of broadcasting the same news and data to all Users. This type of multicasting will be suited for more bandwidth-intensive mobile equipment.

6. Mobile Banking

Banks and other financial institutions are exploring the use of mobile commerce to allow their customers to not only access account information, but also make transactions, e.g. purchasing stocks, remitting money, via mobile phones and other mobile equipment. This service is often referred to as Mobile Banking or M-Banking. More negative issues like ID theft, phishing and pharming are lurking when it comes to mobile banking, particularly done on the mobile web. Net security technology free from redundancy and paradigm shifts away from mobile web-based banking will be an optimal solution to mobile banking in the near future.

7. Mobile brokerage

Stock market services offered via mobile devices have also become more popular and are known as Mobile Brokerage. They allow the subscriber to react to market developments in a timely fashion and irrespective of their physical location.

8. Auctions

Over the past three years Mobile reverse action solutions have grown in popularity. Unlike traditional auctions, the reverse auction (or low-bid auction) bills the consumer’s phone each time they place a bid. Many mobile PSMS commerce solutions rely on a one-time purchase or one-time subscription; however, reverse auctions are high return applications as they allow the consumer to transact over a long period of time.

9. Mobile purchase

Mobile purchase allows customers to shop online at any time in any location. Customers can browse and order products while using a cheap, secure payment method. Instead of using paper catalogues, retailers can send customers a list of products that the customer would be interested in, directly to their mobile device or consumers can visit a mobile version of a retailer’s ecommerce site. Additionally, retailers will also be able to track customers at all times and notify them of discounts at local stores that the customer would be interested in.

10. Mobile marketing and advertising

Mobile marketing is an emerging concept, but the speed with which it’s growing its roots is remarkable. Mobile marketing is highly responsive sort of marketing campaign, especially from brands’ experience point of view. And almost all brands are getting higher campaign response rates.  Corporations are now using m-commerce to expand everything from services to marketing and advertisement. Although there are currently very few regulations on the use and abuses of mobile commerce, this will change in the next few years. With the increased use of m-commerce comes increased security. Cell phone companies are now spending more money to protect their customers and their information from online intrusions and hackers.

PAYMENT METHODS

The main payment methods used to enable mobile commerce are:

• premium-rate calling numbers,
• charging to the mobile telephone user’s bill or
• Deducting from their calling credit.
• Registration of a credit card that is linked to a Sim Card.

CATEGORISATION OF M-PAYMENT SYSTEMS

Most e-payment systems are not suitable for use in a mobile context that is, using a mobile device and communicating over a mobile telecommunication network.  This is due to the special characteristics of mobile devices and mobile telecommunications.  In the following, we categorise m-payment systems according to the whereabouts of the customer’s money:

1. Software electronic coins – electronic money stored on the mobile in file format.
2. Hardware electronic coins – electronic money stored on the mobile device on a smart card.
3. Background account – electronic money stored in a remote account at a trusted third party.

Software Electronic Coins

            In this case, monetary value is stored on the mobile device and the customer has full control of his/her money wherever he/she goes and whatever he/she does.  An electronic coin is represented as a file containing, among other information, a value, a serial number, a validity period and the signature of the issuing bank.  Since software electronic coins are easy to copy, the validity of an electronic coin depends on its uniqueness in terms of its serial number.  The customer transfers electronic coins to the merchant, who forwards them to the issuing bank for the “double spending test.” 

Hardware Electronic Coins

            In this case, monetary value is stored on a secure hardware token, typically a smart card, in the mobile device.  The presentation of electronic money is not important, as long as it is stored securely on the smart card.  Electronic money could be represented as a simple numeric counter.  In order to get to the money, the customer’s smart card and the merchant’s payment server authenticate each other and a secure channel is set up between them.  Then, electronic money can be transferred from one to the other.  This approach is quite attractive because smart cards provide an additional level of mobility.  That means the payment smart card can also be used in POS transactions.  E.g., Geldkarte, Mondex and Barclay card.

Background Account

            Here, the money is stored remotely on an account at a trusted third party.  Depending on the specific payment system, the account could be a credit card account, a bank account, or an account held at the network operator.  For example, in some cases this data is sent in the clear (e.g. a credit card authorisation) not providing any security against eavesdropping and in some cases this information is encrypted and digitally signed, providing anonymity to the customer (e.g. SET – Secure Electronic Transactions).

KEY ISSUES OF M-COMMERCE

            The success of M-Commerce depends on:

• Evolution: Technology and Business models are constantly evolving which will demand flexibility and patience on part of all players.

• Customer loyalty: Who will ‘own’ the customer? Partnerships among players from various industries will be necessary for most, if not all, m-commerce initiatives, and, in turn, will alter the nature of any one company to own their own customers.

• Cross-sector knowledge gulf, where the different parties will need to learn about the functions and limitations of the services provided by the other players, for example, operators will need to know about content and applications.

• Moving up the value chain: To respond to market opportunities some companies have develop subsidiaries in order to react more rapidly to market challenges. For example, Sonera has developed Sonera Zed, to provide portal and application management services such as location based mobile yellow pages as well Smart Trust, to develop secure solution for m-commerce transactions. And Citicorp has established e-Citi to develop a wireless access gateway strategy for financial service providers.

CONCLUSION

As m-commerce applications and wireless devices are evolving rapidly, one will take forward the other one towards empowering innovation, versatility and power in them. There are a number of business opportunities and grand challenges of bringing forth viable and robust wireless technologies ahead for fully realizing the enormous strength of m-commerce in this Internet era and thereby meeting both the basic requirements and advanced expectations of mobile users and providers.

There are news articles and pictures displaying people, who are ordering things over the Internet while waiting for a bus, downloading merchant coupons on their PDAs as they enter a store or bidding for the last table at a hot restaurant by digital phone in a spur-of-the-moment auction. Actually this process represents a tip of a very big iceberg. The advent of m-commerce, as widely referred to among the users, has far-reaching implications. But there are many limitations in the technologies that Once its relevant technologies get matured, widely available and competent, the host of portable devices will be ready to handle the bigger transactional activities not envisioned so far successfully apart from these minor activities. One of the main feature challenges will be to unify payment solutions, providing the highest possible level of security.

Dr. R. Rajeswari