Consumer E-payment: What does the future hold? 

A market report on available e-payment solutions across Europe and around the world, and on the strategies being deployed by fixed and mobile operators, banks and retailers. 
 While e-commerce is booming, e-payment solutions, aside from credit cards, are having trouble establishing themselves
 
• Transactions have become more and more electronic thanks to widespread use of debit cards and credit cards
• The growing ubiquity of the internet, and particularly broadband, is having a positive effect on the development of e-commerce and paid content services
• A great many electronic payment methods exist, but some solutions have failed 
 Some of the more innovative payment solutions are becoming easier to use and more secure: which solutions will rise to the top on this highly competitive market?
 
• Which systems are the most likely to take hold: access mode, platforms, payment instruments used?
• Payment systems based on the P2P or C2C (like PayPal) model are enjoying increasing popularity among American consumers, while e-cash and prepayment solutions are beginning to catch up: is this a universal trend? 
 Non banker players are working on a wide range of innovative strategies to impose their solutions on the market
 
• What are the stakes and challenges involved in micro-payment solutions?
• What role for telecom operators with respect to the banking world?
• Does electronic payment mean the end of intermediaries?

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Benchmark
Comparative analysis of the solutions marketed by: 

• Banksys
• Bibit
• Caisse d'Epargne
• Ebay
• Firstgate
• France Telecom
• Jet Multimedia
• HSBC
 • NTT Docomo
• SK Telecom
• Sonera
• Telenor
• T-Mobile
• Vodafone
• Yahoo!
• ... 
 
 
 
Contents

1/ ELECTRONIC TRANSACTIONS & COMMERCE

Growth of electronic transactions worldwide
• Analysis of the European and American markets
• Development of electronic transactions
• Payment methods: credit card, debit card, automated clearing houses…

Consumer e-commerce
• Current state and future prospects of online sales worldwide (analysis of the American and European markets)
• Diversification of online sales of products and services
• Web users’ perceptions and expectations of e-commerce 

2/ ELECTRONIC PAYMENT SOLUTIONS

E-payment mechanisms
• The value chain: customer, vendor, payment service provider, payment solution publisher, network operator
• General e-payment mechanisms: order, payment request, authorisation, validation…
• Role of e-payment service providers: financial institutions, independent service providers, financial institutions’ partners…
• Micro-payment: minimum sum; the 10 euro threshold?
• Macro-payment: starting at what sum is a bank’s authorisation and optimal security required?

Presentation of the leading electronic payment solutions marketed in Europe and around the world
• Types of e-payment solutions available
• Payment methods: dedicated account, bank account debit, funds transfer…
• Payment instruments: debit cards, direct debit, electronic transfer…
• Access technologies: internet, SMS, voice orders, audiotex, ...

Business models
• Kiosk model
• Paid services
• Commissions
• Profit margin
• Advertising revenues
 

3/ CONSUMER E-PAYMENT SOLUTIONS

Detailed profile of the leading consumer e-payment solutions marketed around the world by banks, fixed and mobile telephone operators, internet access providers and content publishers

For each solution examined:
• Presentation of the service
• State of the service’s development
• Geographical coverage
• Support network
• Value chain
• Business model
• Presence of a financial intermediary
• Types of products or services
• Payment mechanisms
• Buying procedure
 

• BankPass Web
• Bibit Global Payment
• Cashcard
• Checkeys
• EasyClick
• EasyCode
• FeliCa
• Firstgate click & buy
• Geldkarte
• i-mode
• Mobile Banxafe
• MobilHandel
• Mobipay
 • Mobile Wallet
• Moneta
• Moneytronic
• Nemo
• Paysafecard
• m-pay bill
• Paypal
• Peppercoin
• Sonera Shopper
• Vodafone mPay cards
• W-HA
• Yahoo !Pay Direct
 
 
 

4/ LEADING PLAYERS: CHALLENGES AND STRATEGIES

Ensuring secure transactions is essential, and involves several factors:
• Payment authorisation
• Authentication
• Integrity of transactions
• User perception (security, …)

Micro-payment: small sum payments do not require a bank’s authorisation, and are the focus of innovative initiatives, particularly on the part of mobile operators

Mobile payment (or m-payment) is eliciting a great deal of interest among both operators and users, despite the low level of security
• Will mobile become the new electronic wallet?
• Can anonymous cards, such as FeliCa, speed up the trend?

The P2P model
• ls the PayPal model a primary development path for the future?
• What role will banks play? 

Contents

1/ WLAN TECHNOLOGIES

Positioning of major wireless technologies

Main technical features: range, theoretical bitrate, frequency band…
• Wi-Fi and its derivatives
• Ultra WideBand
• The 802.16 standard or WIMAX
• HiperLAN2 and HiperMAN

Players involved in defining standards
• The Wi-Fi Alliance and the WiMAX Forum
• Leading equipment manufacturers active in the world hotspot market

Sensitive Wi-Fi issues:
• Progress making it possible to minimize interference-related risks
• Wi-Fi network security
 

2/ REGULATORY LANDSCAPEE

General situation: current regulation regarding public WLANs

Presentation of the regulatory environment by country 

• Finland
• France
• Germany
• Italy
 • Netherlands
• Spain
• Sweden
• United Kingdom
 
 
 

3/ COMMON APPLICATIONS AND CONFIGURATIONS

Initial applications: wireless technologies’ main applications
• Wireless private networks
• Site-to-site connection
• Hotspots
• Broadband coverage
• Home and home automation networks

Innovative applications: new configurations of use and new products for new customer expectations
• Mesh networks
• Voice over Wi-Fi (VoWiFi)
• Wi-Fi terminals 

4/ OVERVIEW OF THE WI-FI OFFERING

P-WLAN commercial offers: hotspots

For each player analysed:
• Market positioning
• Key target customers
• Offer description
• Market data: number of hotspots, number of WLAN customers
• Partnership strategy
• Development prospects 

• ADP Télécom
• Airpath Wireless
• All Telecom
• Boingo
• BT Openzone
• Korea Telecom
• Orange
• NTT
 • Softbank / Yahoo! BB
• Sprint PCS STS
• StarHub
• Swisscom
• TeliaSonera
• T-Mobile USA
• Wayport
 
 
 

Local authorities and Wi-Fi
• Local authorities’ role in serving rural areas
• Cities’ involvement in providing WLAN solutions in strategic public spaces
• Examples of some of the world’s “Wi-Fi cities”: Auckland, Las Vegas, New York, Seoul, Tokyo...
• Development of city community networks: primarily private initiatives

ISPs’ Wi-Fi offering
• WLAN technologies – are they a challenge for ISPs?
• Types of solutions available: DSL and Wi-Fi… 

5/ CHALLENGES

Market structure and forecasts: Europe, USA, Asia-Pacific
• Which region boasts the most mature markets?
• Growth forecasts through to 2008: number of hotspots by geographic area

Winning business models for P-WLANs
• WISP (Wireless Internet Services Provider)
• Virtual WISP (or aggregator)
• Wholesale
• Site Owner

Player strategies
• Challenges facing the various players involved: fixed and mobile telecom operators, new entrants, site owners, local authorities
• Pricing policies (monthly subscription versus prepaid): in which direction is the market heading?

Challenges related to mobility
• Technological developments, mobile operators’ involvement, roaming…
• After nomadism, mobility is the new priority