The Future of Money - See with 2020 Vision!

By Randy Smith,

Mobile Wallet Media

October 26, 2012

If innovation is the future, understanding innovation is what matters most.

Today, rather than just telling you what I think may be the future of money, I want to start by first taking a look at innovation itself. Plato can be attributed with originating the concept that "Necessity is the Mother of Invention." Innovators like Steve Jobs and Bill Gates helped to shape the future of much of the technology we use today. If we can better understand how they knew what products and services were necessary or in demand, then perhaps we too can forge a clear path forward into the future of commerce. In looking back, we can peer forward and know that history often repeats itself.

So we will begin by observing what they saw and how they came to the conclusions they did. What Bill and Steve had was a knowledge base solid enough to understand the core problems.

This article is published just as when Microsoft has launched a bold new Windows 8. It will make them or break them, but it is innovative. Circling back to 1975, Bill Gates, the co-founder and chairman of Microsoft, and other programmers were writing BASIC (a programming language) and computers were in their infancy. That same year Bill partnered with Paul Allen to form Microsoft. Bill developed the insight and smarts to understand the current barrier to the evolution of software and computers was an operating platform upon which other programs could run. Bill knew what was needed by IBM and all he needed to do was find or develop the software that could serve as this platform or OS. So what Bill had done to be in position to solve the problem was to understand what the main problem was, and how to fix it. He could not have done this if he did not understand the entire ecosystem and he was not networked enough to set meetings. As the story goes, Bill secured a contract with IBM to build their software platform and purchased an OS from Tim Paterson of Seattle Computer Company for $50,000. This operating software came to be known as DOS.

Continue to read the rest of the article.

Mobile Contactless Payment Innovations Summit - Key Quotes/Takeaways

By Randy Smith,

Mobile Wallet Media

October 16, 2012

"The one who enrolls, is the one that controls."

Richard Crone of Crone Consulting speaking about the control of 'Big Data' via Mobile Wallets.

"We must get away from the idea of wanting to control the customer. Today the way you control the customer is to provide value. We just need to confirm ID at POS. Does your new product integrate with all systems and will it scale?"

Amir Wain, CEO of I2C, Inc.

Many profound insights were shared at the 5th MCPI Summit in Chicago on October 2-3.

This event delivered expert opinion from a diverse perspective. In writing this article I could have spun up a short and simple summary with just the key takeaways. However, this event had so many relevant conversations I thought it best to just deliver the conversations as they happened, while screening out the non-essentials. Sort of like using your DVR to watch a football game or favorite TV show.

The host and moderator for many panels was Karen Webster, the CEO of Market Platform Dynamics and President of PYMNTS.com. I've always been a fan of Karen's articles and case studies!

Read the rest of the article.

PayPal + Discover = Dynamic Duo that could also be THE Disruptive Duo!

By Randy Smith,

Mobile Wallet Media

October 5, 2012

I think we've only seen the tip of the iceberg here. Discover was once the 'New kid on the block,' as was PayPal. Now both are firmly established as the number 4 and 5 players in payments. These two companies have incredibly complimentary strengths. Discover has much room to grow and PayPal has always been the innovator and wants to expand it's presence from the online to the physical world. Their current partnership is one that is mutually beneficial. PayPal rides the rails of Discover's acceptance in the real-world stores and Discover taps into PayPal's Digital Wallet, alternative payment methods and their as 110-million+ regular users and 9-million+ merchants.

IF they can figure out how to BEST LEVERAGE each other's strengths, they could both DOUBLE their market share in as fast as 2 YEARS! Yes, I'm saying as they do on infomercials, "But wait there's more!"

Continue to read entire story.

A Square Peg in a Round Hole! Is Pay With Square Scalable?

By Randy Smith,
Mobile Wallet Media
Friday, August 24th, 2012


I love the Starbucks Card Mobile App. It is fast, simple, convenient, fun and rewarding. However, 'Pay with Square' may have a tough time scaling as fast as other Mobile Wallets, like Google, MCX and ISIS, if they fail to simplify integration at POS.

The Pay with Square Video showcases a long overdue and brilliant customer service feature, making it much easier for hospitality employees to provide 5-Star service. I spent several years in the 80's and 90's working in guest services for luxury hotels and in the restaurant industry. Therefore, I understand very much about high-end customer service in the hospitality industry. Pay with Square is great, but it may prove difficult to get their software installed quickly unto POS systems.

Pay With Square will require custom software to be loaded onto 'Locked-Down POS Terminals' and PC's or tablets, which may or may not be unlocked. Locked means the system is 'locked-down' and access to load new software is often controlled by POS Dealers, POS Network Security Firms or POS Providers themselves. Unlocked systems are open and able to download new software without working with the dealer or POS provider. Either way, the fixed systems do not like new software on their platform, much like our bodies do not like viruses or cancer.

Systems are locked down to prevent hackers or viruses from infiltrating the POS software, stealing data and corrupting the system. A 'Secure Network' is set up by merchants to protect the communications between mobile POS and fixed POS systems, as well as the back office, central network or payment processor.

Most 'Fully Integrated Systems' are locked down and many ‘Stand Alone’ PC's are also locked down. POS tablets are less likely to be locked down, unless they are issued by a POS Dealer or POS security firm to better secure the devices.

So Starbucks, Square and all merchants running their stores on Locked-Down, Fully Integrated Systems, will have potentially huge integration challenges or equipment costs to add Pay with Square. For a merchants to accept Pay with Square the merchant has the choice of using Square Register via an ipad or integrate with the merchant's current POS system.

If a merchant wants install Pay with Square on their Locked-Down, Fully-Integrated System, they will have to coordinate the unlocking of the system. Now this would get you Pay with Square, but this would be a stand alone system. Yes, this can be done, but this does not make sense as the customer or the cashier would have need to manually enter the amount due. This leaves too room for mistakes by cashier or customer and a process of closing out the transactions with their current POS system would need to be established as well. This makes no sense to do this unless they were just showcasing a proof of concept. Since Square needs a highly scalable system, this is not the solution.

However, it might make more sense if Square separates out the 'ID recogniztion' from the actual payment authorization. Or if they could authorize transactions separately from the existing POS and then merge the transaction data back in real-time ito balance and reconcile the cash register ledger.

The most likely solution for Square is to integrate fully with POS systems, like TabbedOut, Paydiant or MocaPay have already done. They would start with the system(s) Starbucks is using and try and integrate with the top 10 systems by early next year. This too, is not a straight forward process, as connecting to each POS system is a very different process.  There is another, more scalable way to do this, but I'm not at liberty to discuss publicly, as it could potentially reveal MobilePayUSA trade secrets.

Other than integrating to dozens of POS Systems, I don't see how Square will scale quickly with installing Pay with Square. This could be a very viable route if they have enough people assigned to integration. Within 3-months they could accomplish integrations, then run 3-months private pilots and be ready by Q2 of 2013 for launch of Public Beta. Many merchants have older POS systems, which they very likely would be required to replace or upgrade if they wanted to accept Pay With Square or several other mobile payments solutions. Maybe I'm wrong about all of this and Square has some unique integration method up their sleeve? But it does appear Square will still have to work within the limits of known integration methodology.

So one may ask, "Will this not lead to merchants switching over to Square Register and tablets?" Yes and no. This is a function of size and complexity of their store ordering system and size of their chain.

The larger the retail chain, the less likely they will want to swap out their current system to Square Register. It will be really hard to convince major retailers to change out their entire systems just to accept Pay with Square! We've already seen that most major merchants dragged their feet to pay for terminals with NFC. POS registers cost up to $3500 each, the POS software they run is most likely already works great and is secure.

Retailers would only want to adopt Square if they had simple ordering needs at POS, like a coffee or sandwich shop, and they were unhappy enough with their current system. It makes complete sense for new merchants with simple software needs, as the cost to get up and running with ipads and Square Register is as much as $3,000 less per register. By the way I do think Square Register has a huge potential merchant base, merchant's with fairly simple software needs, but it will have a tough time convincing 'Top Tier Retailers' to rely on Square as the platform to run their stores.

Unless a merchant is committed to being an innovator, like Starbucks, Square will truly a 'Square Peg in a Round Hole' and is not likely as scalable as NFC or QR code generation and scan like Starbucks Card Mobile. If Square sticks to Starbucks Card Mobile model and ditches or keeps their very cool, customer service tool separate from payment, they may scale at a pace equal to many current competitors.




About Mobile Wallet Media
Mobile Wallet Media is a news media, analyst, marketing and consulting firm focused on the future of mobile: payments, marketing, loyalty commerce, security, prepaid, virtual currency, daily deals and the convergence of them all with social and local. The Chief Editor, Randy Smith, was the primary founder, inventor and former CEO of MobilePayUSA, a TechCrunch Disrupt Award Winner.

Retailers Stepping Up To Build Own Mobile Wallet Network

By Randy Smith, Mobile Wallet Media
Wednesday, August 15h, 2012

It has always baffled me as to why retailers have not banded together to form their own mobile wallet network. The benefits are too many to not engage in doing so.


Today with the announcement of Merchant Customer Exchange (MCX), leading retailers Wal-Mart, Target, 7-11, Best Buy, CVS, Darden Restaurants and more, a much anticipated 'Retailer Mobile Wallet Network' focused on serving their customers has formed. MCX has not revealed the technology to be used to enable their mobile wallet, nor have they hinted as to when the service will be available.

In the release Mike Cook, corporate vice president and assistant treasurer at Wal-Mart said “MCX will leverage mobile technology to give consumers a faster and more convenient shopping experience while eliminating unnecessary costs for all stakeholders. The MCX platform will employ secure technology to deliver an efficiency-enhancing mobile solution available to all merchant categories, including retail stores, casual dining, petroleum and e-commerce.”

Over the past several years, the goal to create a standard format enabling simple, fast and secure mobile payments, via a mobile wallet, has proved to be a long and drawn out process.

NFC tech, long used in Japan for conducting mobile payments, has been the leading choice of Google Wallet, ISIS (Carrier network), Visa, MasterCard, PCI (Payment Card Industry - card data security rules) and payment terminal manufacturers such as Verifone. NFC tech has been slow to gain traction because retailers have not wanted to pay for the replacement of existing terminals, that may end up needing replacing again if they jump too early. Alternative methods have been introduced by Square and LevelUp that use scanning of 2D bar codes displayed on
mobile wallet smartphone apps.

No matter how you slice it, it seems there is always a 'chicken and egg' problem that will not go away. But now with the retailers 'flexing their mobile muscle,' it is beginning to look like there is no clear favorite to dominate as a single format (I already went over in depth in my previous article). But just like retailers must embrace Facebook, Twitter, Google+ and accept all four major payment brands, they will also need to accept other payment networks beyond their own. This is about consumer reach.

The retailers should most definitely maximize their marketing reach, but the bottom line is they still have to get their customers to return to their stores. Reaching customers through various and many marketing channels has always been a winning strategy, and nothing will change here.

In the release, Mark Williams, president of financial services at Best Buy said “As merchants, no one understands our customers’ shopping and payment experience better than we do, and we’re confident that together we can develop a technology solution that makes that experience more engaging, convenient and efficient".

A key advantage for MCX is the cost savings to deliver mobile payments, offers and loyalty through their own platform. I imagine that the retailers themselves have hired a consulting firm to work with them on this to deliver and manage the solution. If so, they will still need to 'put their pants on one leg at a time' and have to pay someone, but the costs are likely to much lower. Their are a ton of moving parts and various POS systems that need to be integrated and connected to a single platform.

I know very well this model is a very real possibility, as the company I founded, MobilePayUSA, has a 'Universal and Patent-Pending Solution' that sounds much like the MCX solution. The retail network proposed by MCX brings added disruption not only to the payments space, but also the mobile loyalty and advertising space. I am writing two series (The 7S's Required for Success in Mobile Payments and SuperCommerce) this Summer and Fall that speak directly to this upcoming disruption and merging of payments, marketing and mobile.

Mobile Wallet Media is a media, analyst and consulting firm focused on the future of mobile commerce. The company mission is to highlight industry innovation and provide insights and opinions that will be relevant and forward-looking. The author, Randy Smith, is the primary founder, inventor and former CEO of MobilePayUSA, a TechCrunch Disrupt Startup Alley Winner.