LONDON—Mobile commerce is poised for a take-off within the next few years, according to a new Frost & Sullivan study.
The consulting firm expects trade worth $25 billion to be generated through mobile payments in 2006, which equates to about 15 percent of online e-commerce spending. The report predicts mobile-accessed Internet (merchant WAP sites) and peer-to-peer payments between individuals will represent the majority of the payments, accounting for 39 percent and 34 percent respectively. The study also asserts that mobile payments will also be used to perform automated point-of-sale payments (vending machines, parking meters, and ticket machines); attended point-of-sale payments (at stores, in taxis); and mobile-assisted Internet payments (fixed Internet sites using a phone instead of credit card).
“Analogies can be drawn with the introduction of credit cards 50 years ago, currently the principal alternative to cash,” said Ben Donnelly, research analyst. “They were perceived as a niche product and unnecessary luxury for many years until global technology standards made them viable for the mass market.”
Donnelly further points out that while security risks are likely to be the key issue for m-commerce, mobile payments actually offer higher security protection than credit cards. “The fraud risk is miniscule compared with credit cards” said Donnelly. “A stolen mobile phone is far harder to crack than forging a signature on a credit card.”
