Mobile Commerce

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"m-commerce in its true form is the ability to charge an amount of currency to a mobile phone either by applications like Mobillcash or Near Field Communications,the amount to be charged is actually taken from the Mobile device's account or pre loaded RFID chip". It is a prime example of telecommunication convergence, both horizontal (it happens on a mobile device) and vertical (it can involve any product).

Mobile Commerce (also known as M-Commerce, mCommerce or U-Commerce, owing to the ubiquitous nature of its services) is the ability to conduct commerce, using a mobile device e.g. a mobile phone ( or cell phone), a PDA, a smartphone while on the move,and other emerging mobile equipment,like dashtop mobile devices. In an academic definition (Tiwari and Buse, 2007, p. 33) it is characterized in the following terms:

"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." "m-commerce in its true form is the ability to charge an amount of currency to a mobile phone either by applications like Mobillcash or Near Field Communications,the amount to be charged is actually taken from the Mobile device's account or pre loaded RFID chip"

This definition provides for a differentiation of Mobile Commerce from other related fields such as Electronic Commerce, Electronic Business and Mobile Business; see [1]

Contents

[edit] History

In 2000 and 2001 hundreds of billions of dollars in licensing fees were paid by European telecommunications companies for UMTS and other 3G licenses. The high prices paid were due to the expectation of highly profitable mobile commerce applications. These mobile commerce applications would be delivered through broadband mobile telephony provided by 2.5G and 3G cellphone services.

PDAs and cellular phones have become so popular that many businesses are beginning to use m-commerce as a more efficient method of reaching and communicating with their customers. Although technological trends and advances are concentrated in Asia and in Europe, Canada and the United States are also beginning to experiment with early-stage m-commerce.

The recent alliance between Sprint Nextel and Clearwire for WiMAX network creation will acclerate the (speed/creation?) of the more data-intensive 4G networks. The WiMAX networks are being built for completion by 2008. This will provide a turning point in m-commerce in North America.


With the forthcoming spectrum auction by the FCC, scheduled for early 2008, there will be major auction rule changes that will create more consumer options while reducing control by telecom operators as "network gatekeepers". The auction rule changes being pushed by Google, irk Verizon Wireless and AT&T and signify a big change coming to m-commerce.

The less price sensitive early adopters from the 13-25 age group could drive the initial growth. Growth in mobile products such as ringtones, games, and graphics may displace spending on many traditional youth products such as music, clothing, and movies. This would radically change the dynamics of all visual entertainment and product-service distribution world wide so marketers could target end-users with diverse youth mind sets. The youth market has historically shown rapid viral growth which later gains acceptance in the mass market. While emerging markets are proving to be the ideal solution for sustaining revenues in the face of falling ARPU average price per unit, analysts say the rapid commercialization of 3G services is likely to open up new opportunities in developed markets.

In order to exploit the m-commerce market potential, handset manufacturers such as Nokia, Ericsson, Motorola, and Qualcomm are working with carriers such as AT&T Wireless and Sprint to develop WAP-enabled smart phones and ways to reach them. Using Bluetooth technology, smart phones offer fax, e-mail, and phone capabilities.

"Profitability for device vendors and carriers hinges on high-end mobile devices and the accompanying killer applications," said Burchett. Perennial early adopters, such as the youth market, which are the least price sensitive, as well as more open to premium mobile content and applications, must also be a key target for device vendors.

[edit] Products & Services Available

[edit] Mobile Ticketing

Tickets can be sent to mobile phones using a variety of technologies including bCODE and NFC. Users are then able to use their tickets immediately by presenting their phones at the venue. Recently, WiMAX-enabled dashtop mobile payment platforms[1] made a debut, ID on kiosk keypads at the entrance of ballparks, airports, train stations instead of physical tickets, but this dashtop mobile equipment will take some years to get commercially implemented.

The travel industry is realizing the potential benefits of m-commerce, and is working on technologies that will eventually equal the ratio of bCode and NFC, update customers on flight status, notify them when this information changes and will offer to make new arrangements based on preset user preferences requiring no input from the user. Therefore, a customer’s entire trip can be scheduled and maintained using a mobile device. 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. Kayak.com, Expedia.com, Yatra.com are a few of the portals that provide such services.

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.

[edit] Mobile Vouchers/Coupons/Loyalty Cards

Mobile ticketing technology can also be used for the distribution of vouchers/coupons/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

A relatively new development in the world of m-commerce is Ecrio's MoBeam technology. MoBeam uses a light source on a small keychain-based device (called the ClipPod™) or mobile phone to originate the long-and-short sequencing of a standard barcode. A standard laser scanner - like those in use in over 35 million brick-and-mortar retail locations in the US - interprets those light beams exactly as it would the reflection of a printed barcode.

[edit] Content Purchase & 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.

A new online shopping trend of "booking on the web for pickup later in stores" is evolving into a new concept: Just In Time(JIT) pickup for mobile shopping behind the wheel. This JIT pickup for mobile shopping indicates a "real-time bridge between the virtual world and the real world".

[edit] 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

[edit] 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.

[edit] 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.

[edit] 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.

[edit] Auctions

Over the past three years mobile reverse auction 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.

[edit] 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 retailers 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. New technology from companies like ShopText allow consumers to purchase products from their cell phones using text messaging and technology from companies like mShopper & mPoria allow retailers to launch their own mobile commerce shopping sites.

[edit] Mobile Marketing & 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 [2]. 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. New technology from companies like mPoria are also allowing companies to sell merchandise to consumers over the mobile internet.[citation needed]

The hierarchy of mobile media is changing very rapidly and mobile WiMax or other technologies may increase the impact of, for example, location-based mobile eCommerce. As of 2007 many companies have been trying to penetrate this market.A early pioneer in this new Mobile advertising is few companies such as Vodaphone-Orange.In 2007 a Visionary of the name of Leveious Rolando took Venn-diagram model of rapid youth life style/trends how they are vital aspects of adoption and sales of global products-services on the internet- mobile advertising.By the use of viral marketing alone with context of viral mobisodes-mobile commercials or mobimercials the tested a theory of rapid vial memetic understanding of youth life styles and trends.He co-developed in Europe-South Korea -Japan A Viral mobile straight to the end-user mobile integrated campaigns for the Delivery of product sales instant from Mobile hand-held devices was Co-Directed inconjuction with top Mobile providers such as German -T mobile with music artists -Djs and Mobile youth street teams that not only drove instant purchases of event tickets sales but also drove the sales of purchase of three different viable youth products to over 200,00 thousand end-users in 8 days.this was well documented by up-coming 2008 BBC Documentary on the Global youth mobile market/trends and how products-applications take on new life because of youth mindsets who are the early adopters of any form of social engaging technology- services. Leveious Rolando along with Gibran Burchett developed fashionable products in order to engage the end-consumer the m-commerce market potential, handset manufacturers such as Nokia, Ericsson, Motorola, and Qualcomm are working with carriers such as AT&T Wireless and Sprint to develop WAP-enabled smart phones, the industry's answer to the Swiss Army Knife, and ways to reach them. Using Bluetooth technology, smart phones offer fax, e-mail, and phone capabilities all … but market had to be engulf with the context of the youth life style that drives content back and forth world wide and use music to drive the mobile market. "Profitability for device vendors and carriers hinges on high-end mobile devices and the accompanying killer applications," said Burchett. "Perennial early adopters, such as the youth market, which are the least price sensitive, as well as more open to premium mobile content and applications, must also be a key target for device vendors this was discuss by both Leveious Rolando and Gibran Burchett at a Mobile Commerce meeting in Japan August 2007.they are along with few others have developed methodology to be deployed global through concerts and events and any form of youth related culture from South Korea to Japan to Europe,America in 2008 with world leading mobile software provider and world leading mobile prodvider. companies such as European giant www.orange.com and www.overcell.com and world leading personal mobile software provider www.vidiator.com and other companies in South Korea, Japan and Britain, Germany lead this evolutions of Mobile advertising.

[edit] Mobile Vouchers/Coupons/Loyalty Cards

In combination with POS terminals this technique can be used for distributing vouchers for top up of mobile phone accounts. Advantage of this system is reduce of cost for distribution, main disadvantage is that that you need a widely spread network of POS terminals. There are two models present in the market: voucher distribution (PIN based), where hidden recharge number (PIN) is printed on terminal and direct top up, where subsribers number is entered on terminal and recharged automatically.

[edit] 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.

[edit] Related Technologies

[edit] References

  1. ^ What is DirveOnPay for?
  2. ^ Increasing Trends Of Mobile Marketing

[edit] See also

[edit] External links