I have decided that I will not blog while on holiday, but the Nokia Money announcement is so big that it just cannot be ignored. While I am spending time with good food and wine in a beautiful region, I also cannot help thinking about mobile banking. So I decided to give my penny-worth:I recently posted some of my observations on the hook-up of Luup with Deutche Bank (read more here). According to my understanding, Luup discarded their retail focus to hook-up with Deutche Bank to bring their mobile banking solution via the distribution reach of the bank to many countries in the world. Luup must be complimented on their focus on this initiative as this will allow them the best chance of succeeding.
In a similar way, Obopay have now teamed up with Nokia to bring their mobile banking technology to many countries by making use of the retail distribution network (and consumer brand) that Nokia allows them to use. I believe that this hook-up is similar to the Luup initiative and I would expect that Obopay would (over time) relinquish their own retail aspirations. It will also be difficult to develop an enterprise strategy at the same time as developing Nokia Money. It is not clear whether they will also (like Luup) focus exclusively on Nokia as a distribution strategy.
The biggest difference for me is the fact the the Bank is a much stronger distribution (almost retail) brand, whereas Nokia is a very strong product brand. A strategy based on utilising Nokia as a distribution brand would fail I think (with some exceptions like maybe India). It is my experience that Nokia is seldom distributed exclusively through a Nokia channel. Distribution networks in most countries also distribute other handsets. The impact of bundling a Nokia Handset with a Financial service will have to be evaluated carefully as I am sure Nokia cannot afford that their flirting with Money should impact their mainstream business.
4 comments:
I also find O2's approach interesting. They have just launched O2 Money which is effectively just a glorified credit cardcoupled with some mobile banking apps, but what's significant for me is that it represents a definite move by a Mobile Operator into this space.
I can see where O2 may head with this and how they can use the project to gain experience for the potential of the O2 SIM card becoming a mobile wallet, perhaps coupled with and NFC chip in the phone for the physical transaction.
The announcements by these two industry giants marks the start of a more public and more monumental move towards the reality of mMoney...
On Sept. 7, 2009, a leading Internet security expert, Dr. Stan Stahl, has issued a stern warning against mobile banking: http://www.bizcoachinfo.com/archives/1399
Terry, please ask Dr. Stahl to contact me to update him on Mobile banking security, It is unfair and irresponsible to judge all mobile banking deployments in the same way.
I agree that Mr. Corbell and Dr. Stahl have overstated the dangers of mobile banking.
Coincidentally, I recently wrote an article on what consumers need to know about mobile security.
While users should be aware of overt fraud, most North American mobile banking implementations don't even provide enough functionality for a criminal to profit from his endeavors.
The bottom line is that consumers should be informed so they don't get tricked. However, the convenience and visibility into transactions that mobile banking provides likely far outweighs any security risks of most responsible mobile banking sites.
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