Telefonica | March 31, 2011 | Press Release
• Telefónica to launch the first NFC “real” experience in Europe • The project is being carried out with the assistance of Autogrill, Bankinter, BBVA, G&D, La Caixa, Oberthur, Samsung, Sermepa and Visa • The number of mobile handsets equipped with Near Field Communication Techonolgy will reach 260 million in 2014 and the value of the transactions made will amount to over 80 billion euros worldwide
Guillermo Ansaldo, Chairman and CEO of Telefonica España unveiled today: ‘Distrito NFC’, at its headquarters in Madrid. This is the first international corporate experience to bring the NFC (Near Field Communication) technology to a real corporate environment. NFC is a an innovative system which enhances the present capacities and uses of mobile phones adding a number of functions ranging from information exchange to access to restricted areas, or payment for daily purchases by phone.
Highlighting the significance of this project Guillermo Ansaldo, Chairman and CEO of Telefonica Spain said: ‘By launching this initiative and other similar projects which we will deploy in other countries where we operate, Telefonica aims to prepare for deployment in Spain and lead the way in NFC development. It is estimated that the number of mobile NFC enabled mobile handsets will reach 260 million in 2014[1] while the value of the transactions made will surpass 80 billion euros worldwide[2]‘.
The project kicks off with one thousand Telefónica employees, who have been given NFC technology terminals to allow them to use their mobile phones for easy secure payment at retail outlets on the business campus and local establishments. They can also access their work locations by simply bringing the terminal up to the entry turnstile, or load their ‘meal cheques’ into the phone to pay for their meals and beverages at catering facilities on the complex, among other functions. The number of participants in the initiative will be gradually increased as it develops, targeting all those working at District C, approximately 12,500 employees.
The partners providing the services for employees are Autogrill, Bankinter, BBVA, La Caixa and Visa. The other firms assisting with the project are G&D, Oberthur, Samsung – supplying the NFC mobile terminals – and Sermepa.
The forerunner to the experiment was a pilot project introduced recently by Telefónica with the assistance of La Caixa and Visa in Sitges in the province of Barcelona, ‘Mobile Shopping Sitges2010’, the largest NFC project carried out in Europe in a real scenario with such a large number of participants. A total of 1,500 people and 500 businesses in Sitges carried out the initiative over a period of six months, and the outcome was so positive that when the pilot project had been completed the participants continued to use their mobile phones for payments, since they found it so useful, fast and secure.
The results of the Sitges experiment demonstrate the vast potential of mobile phone payments: customers carried out 30% more e-transactions, with a 23% increase in average purchase per user with their card. Also noteworthy was acceptance of the technology by all groups of people, since the average age of customers using their mobile phones to pay for their purchases was 46. User opinion data were also highly satisfactory: most participants feel the system is fast, easy and just as secure as traditional methods of payment, and they also have a degree of control in that they do not show their cards to any third parties.
HOW NFC TECHNOLOGY WORKS
NFC is an interconnection technology which is felt to be the system of the future for validating tickets or payment transactions (for example, for admittance to leisure facilities such as cinemas or museums, general proximity payments such as public transport or parking lots, to accumulate points on loyalty cards, or to use coupons in similar environments, among others). It is simple to use as the phones only have to be placed in close proximity to point-of-sale readers.
For purchases, the user merely brings the phone up to the point-of-sale (POS) terminal at the establishment after the trader has entered the amount. The phone display shows the reading is correct, and the POS display will confirm acceptance of the transaction. NFC technology enables transaction speed, ease-of-use and convenience for both the trader and user.
To allow customers easy access to the information stored in their mobiles, Telefónica’s R+D team has developed the Cartera Movistar or ‘Movistar Wallet’, allowing users to choose which bank card they wish to employ for their purchases, gain direct access to their company facilities, download any information that may be of interest to them by bringing the mobile up to certain items such as posters or brochures, use their travel card, or even use regular mobile banking services. The mobile terminal saves a secure digital version in the SIM of any cards users may have, and they can use NFC technology to pay directly at the POS terminals and adapted readers at sales outlets.
