Michael Mullagh



Mobile and Payment










Mobile Commerce Opportunities 

[Note: Some analysts define Mobile Commerce to include remote on line transactions where a mobile device is used simply as an alternative medium to a PC. This analysis only considers the use of a phone or a tablet at a physical Point of Sale (POS) - a much higher potential, but considerably more complex, market opportunity] 

There are two separate, often confused, mobile payments/commerce categories with quite different purposes at the physical POS:


  • The Smartphone as a device to make payments or redeem offers at a POS using NFC, Bar Codes, number entry and so on;


  • The Smartphone as a device to accept payments via conventional cards (known as mPOS)


In the first case the phone is a substitute for cards, cash and conventional media in a traditional POS environment. In the second case (mPOS) the phone was initially envisaged as a substitute for a traditional POS device where none existed. It was targeted at un-served segments (like micro merchants). Now mPOS is moving into  the physical store in Tablet form – a powerful Cloud connected device with significantly more capability/utility than conventional POS. While value propositions for merchants and consumers, and competitive threats to conventional players, are quite different between these two categories, opportunities abound across both for existing and emerging eco system players.


  • Merchants can increase sales, reduce costs and increase loyalty through smart, personalized, real time offers and information, while people are shopping, on the move, or browsing 

  •  Consumers value personalized, location driven, “opt in” information and offers and "line busting" mPOS - and unlike most electronic POS enabled merchants many consumers value the benefit of paying via phone   

  • On-line players (be they advertisers, payment providers or retailers) see the Smartphone as a bridge to the off-line brick and mortar store market, which is 10-15 times larger than the on line market today


  • Card based payment providers nand issuing banks, and their supporting processing, merchant acquiring and ISO infrastructure see the Smartphone as a means to deliver more transactions and differentiation
  • Mobile players see a large new stream of revenues from enabling and offering mobile commerce services

  • Media and marketing companies see the Smartphone as a platform to enable the ultimate in 1 to 1 “narrowcast” messaging and 1 to 1 offers
  • Technology and service providers (POS and Mobile Devices, SW, Networks, Applications Developers), new and old, see a large field for new and enhanced products and platforms. 
  • The Investment community is seeing a new market with huge return potential and a raft of new players
These opportunities are real, meaningful and large. However as discussed on the next page risks are equally real and need to be fully understood by any player or investor.