Service Excellence

Who Wants To Be A Mobile Blue Whale (Or Be Swallowed By One)? Part II

By Niket Parikh June 6, 2012
Mobile Payments via Square

Source: Square, Inc.

In part I of Who Wants To Be A Mobile Blue Whale (Or Be Swallowed By One, I discussed the massive growth of mobile payments, which is projected by Yankee Group to reach $1 Trillion by 2015.  That’s with a Capital T.  Companies cannot dip their toe in the water; they need to create full-on tsunamis to capitalize on this disruptive technology.  So who are these companies playing in the ocean right now?

Only in the past couple of years, a lot of startup fishes have birthed – and these are not the traditional newborns – most of these are entering the new world with silver spoons and gold and platinum baits in their mouths.  Hoping to grab a piece of that capital T, many keen investors and venture capitalists have poured in millions of $$$ of funding to feed these fishes, eventually expecting to convert them into blue whales.

  • Square, one of the most widely known mobile payment companies and started by a Twitter co-founder, offers an easy-to-use  credit card reader that plugs in to a phone or iPad to turn those in to cash registers and POS systems
  • Dwolla, a startup founded by a 28-year old, uses instant ACH transactions to enable peer-to-peer and customer-to-merchant transactions without percentage-based merchant transaction fees
  • Obopay is like mobile PayPal, allowing users to send money to others via cell phone, text message or web interface
  • Irish fish BoxPAY has recently expanded to the U.S. and is challenging mobile wallets with an SMS-based platform that enables a user to make a purchase with a phone number and pin code, which is then added to the phone bill
  • BillToMobile is another company attempting to allow consumers’ web purchases billed on mobile carrier statements
  • An Israeli fish DigiMo is looking to pilot in the U.S. a bar-code reader that scans products and allows consumers to pay at the point-of-sale (POS), regardless of whether the merchant is NFC-equipped
  • SCVNGR has created LevelUp, a mobile payment app to allow users get deals at merchants, while paying with mobile phones

Some of these startups have a long way to go, and amongst those, many are just looking to be big enough to be noticed by the whales and be swallowed by those whales.

Larger fishes and whales are already beginning to strike back by holding their market positions.  Intertwined technologies in the mobile payments space are helping them create strategic partnerships with other whales and startup fishes.

  • Google announced their NFC-powered Google Wallet with initial partners Citibank, MasterCard, Sprint and First Data will be piloted first in New York and San Francisco and then rolled out nationwide in Fall; their tap-and-go technology will facilitate coupon-less offers, loyalty cards, digital receipts and many more (news source)
  • Isis, a joint venture of AT&T, T-Mobile and Verizon Wireless, is working with VeriFone, Ingenico, Vivotech and Equinox Payments to ensure that the terminals deployed in the future will have the ability to accept Isis payments using NFC-enabled phones (news source)
  • MasterCard partnered with device manufacturers like Blackberry, Samsung, Sony, LG and others to have NFC-enabled smartphones to be used with their PayPass technology (news source)
  • Apple has also applied for NFC patent to allow users pay with their iTunes account using a futurist NFC-enabled iPhones (news source)
  • American Express’ mobile payment solution Serve is now integrated in to Verizon Wireless’ phones and tablets (news source)
  • Visa is also forging ahead in mobile payments with the NFC technology by introducing to compete with MasterCard (news source)
  • PayPal’s new mobile strategy may be an overkill, but they are making every payment count by not only having merchants accept payments at terminals, but also by launching a triangular credit-card swiping device called PayPal Here, very similar to Square (news source)
  • FISERV, a technology solutions provider for financial industry has developed Mobiliti – a solution in mobile banking, alerting and payments for financial organizations (news source)
  • Intuit, who owns GoPayment – a device and technology similar to Square and Here, recently bought AisleBuyer, a 3-year-old company whose smartphone based technology lets consumers receive promotional offers when they walk in to a store, scan a product barcode and pay for the item while standing in the aisle using card data stored in the phone (news source)

The list of other players on the hot seats goes on and on – it would be quite a sizeable task to count and name all the fishes in the ocean; however, stay tuned to learn more about this fascinating race, about some of those fishes and find out who starts emerging as the blue whales!!!

Fun Fact: Did you know that the blue whale’s head is so wide that many of these startup teams (about 100 people) could stand in its mouth?  As mentioned, many of these fishes are just looking to stand on the tongue of the whales, hoping to be swallowed…

Who are you rooting for?  Have you already made any mobile payments?



About Niket Parikh

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2 thoughts on “Who Wants To Be A Mobile Blue Whale (Or Be Swallowed By One)? Part II

  1. Great post Niket. It would be great to see a post that talks about Mobile payment value chain and the corresponding vendors and their products therein.

  2. Thanks Praful – I was a little out of commission recently; however, I’m back on track – just posted the next blog on questioning the value chain of Mobile Payments – please do check it out