Tuesday, January 25, 2011

The telefonica mobile money announcements are confusing

From a banking the underbanked perspective, Telefonica is one of the most exciting group to make things happen. With almost 300 million subscribers, and a healthy mix of emerging, semi-developed and first world countries, this group can influence the industry with exciting services. This is why I have followed their progress with a lot of interest (and support).

Prior to 2010, many announcements regarding mobile financial services were made. These ranged from money remittances in conjunction with Western Union (Read here), to other innovative solutions, in this case with More Magic (Read here). Fundamo also deployed our solution in a pilot environment (with support from the GSMA and Accenture) on one of Telefonica's bigger networks. My understanding (at least those that I had visibility of), was that these deployments worked well and showed a lot of promise.

Then the group process kicked in and a technology solution was selected for the group. The announcement was made early in 2010 and Trivnet was selected as the supplier of the solution (Read here). All other initiatives were delayed or discontinued in expectations of the new solution that would be rolled out swiftly to group companies that needed solutions urgently. This is why the latest announcement (Read here) was so confusing for me. Telefonica is now partnering with Mastercard to roll out this service.

When discussing this on one of Linked-In chat sessions, one of the participants commented "It would seem logical that the Trivnet experiment would be eclipsed by thus. Telefonica can chalk that up as an experiment in the space and what they learned is they need a partner with greater commercial capabilities." Bad news for Trivnet, but it does look as if Telefonica selects a different flavour for every year. Such a pity.

1 comment:

Anonymous said...

Telefonica's switch from TrivNet to Mastercard highlights the importance of:
1. selecting the right strategic partner. You need to know what you are looking for, and then perform the necessary due diligence to determine if your strategic partner meets that need.
2. Being agile enough to identify a mistake and take quick corrective action. I read somewhere that "If you're on a bus to Johannesburg, but your destination is Cape Town, then the quicker you get off the Johannesburg bus and onto the next Cape Town bus, the quicker you'll reach your destination!

Maybe telefonica didn't do 1. properly, and maybe this announcement is doing 2. properly?