Friday, November 12, 2010


I thought, why not, it was almost Friday the 13th, how about coining a new phrase! So, here you go, meCommerce - the convergence of m and e commerce with a cute spin.

With all the spin about mobile and especially mobile payments, I thought I would have us think about what really matters and that is "me", the consumer side of me. After all, this is the "me" economy isn't it?

All that really matters to the consumer is that they have as seamless an experience as they can have across all the platforms and devices they utilize to maximize their time and money.

As ecommerce evolved, those merchants who figured out how to blend the benefits of bricks and clicks delivered the most value to their customers. Now, we have bricks, clicks and pockets (? - perhaps someone can contribute something better!!).

Mobile, with the proliferation of smartphones which are just computers in your pocket that happen to also sometimes work as phones, present enourmous possibilites for enhancing the overall experience for the consumer.

As it relates to payment, the only hang up is the explosion of "Walled Gardens 2.0" which serve to restrict the consumer from the freedom to pay how they wish and merchants the freedom to choose which payment methods they want to take and their ability to negotiate the best rates their volumes deserve. These perhaps serve a purpose during an initial formative phase but they will disintegrate as the power shifts from the few to the many.

Friday, November 5, 2010

Article on Direct Mobile Billing in Digital Transactions

I am pleased to report that an article I authored is available in this month's issue.

If you click on this link and then choose the November issue, you can read it;

It is on page 22.

Would welcome your comments!

Friday, October 29, 2010

BilltoMobile Adds ATT (Only provider with both ATT & Verizon)

This has been a big week for the advancement of carrier billing for ecommerce purchases! The company I work for BilltoMobile (powered by Danal Ltd, Korea) announced and launched support for ATT mobile users. This is in addition to our previously announced and launched support for VZ users. We now have 2/3rds of the US mobile user market covered and more to come! We are the only provider that can provide the superior capabilities (ie; dynamic pricing, real-time auth and verification, limit management, dramatically lower dispute rates) and lower costs of Direct Mobile Billing (carrier billing 2.0 versus the legacy PSMS approach used by others) on both Verizon and ATT!!!

Starbucks Extends Mobile Payments to Nearly 300 More Stores

"(October 25, 2010) In the biggest expansion yet of mobile payments to its standalone stores, Starbucks Coffee Co. on Monday said it has equipped almost 300 company-owned stores in New York City and parts of Long Island to accept transactions using 2-D bar code technology. This expansion follows the Seattle-based coffee chain’s move this spring to install the technology in outlets located within more than 1,000 Target Corp. stores (Digital Transactions News, April 8). Starbucks started its mobile-payments pilot 13 months ago at 16 standalone stores, eight in Seattle and eight in California’s Silicon Valley."

This is great news! Only one problem! I do not live in NYC anymore! This approach overcomes a lot of issues that have plagued other approaches to connecting the physical world payment card to the mobile phone.

Hopefully they will get back around to expanding in the Bay Area!

Saturday, August 14, 2010

NFC vs 2D Bar Code for Mobile Retail POS?

I know that this is not ecommerce related (at least not for the moment), but since Mobile Payments is the topic du jour, I thought I would comment on it. So, what is it going to be? NFC has been struggling for meaningful deployment for more than a few years and I think the time has passed. Merchants (that matter) have already embraced bar code technology at the POS and if they are not already 2D capabable upgrading to it probably would not be as painful as installing single purpose (credit card network controlled) NFC readers. They can then be in control of their own destiny at their POS and leverage the enhanced bar code technology for other purposes.
Why did NFC fail? When you combine the fact that most large merchants (supermarkets and big boxers) had turned the terminals to the consumer so they could swipe the card themselves combined with the card brands new rules around no signature for under $25 transactions, a lot of the motivation for NFC which was checkout speed evaporated.
The virtual Starbuck's stored value card iPhone app is the best example I have seen of such a deployment. I only wish it was in more street locations. I know it is now in all the Target based Starbucks but Target is not someplace I stop into on my way to work in the morning. However, this is an interesting point as to why the Target locations were deployed so quickly as they already had the 2D bar code technology and a simple software upgrade accomplished the task.

Friday, August 6, 2010

Facebook Credits bought by Mobile Payments...Disclosure Needed or Not?

I decided it was time to check out Facebook Credits. Last nite I navigated my way to buying some not because I need any but just to see what the payments experience is. I was curious if they were surcharging their "friends" when paying with a Mobile payment instead of credit card. They are to the tune of roughly 50%. The consumer gets 1/2 the number of Facebook Credits when they pay by charging to their mobile phone number.

I realize that their merchant cost is high due to the carrier's fee and therefore it is not completely unreasonable to do this.

What I do find unreasonable is that there is no clear disclosure of what the deal is.
You have to click back and forth between the choices when wanting to pay with credit card and wanting to pay by Mobile and have to do the math in your head.

When I shop at the supermarket, I expect to be able to look at the labels on the shelves and see that the Coke Zero in the 12 oz bottle costs me $.05/ounce and $.04/ounce in the 20 oz bottle.

It is one thing for some low life elixer company to pull this sort of deception, but another for a company like Facebook that should care about their reputation and credibility. And it should not require the government or some other body to monitor and enforce reasonable and ethical behaviour.

The Mobile Marketing Association guidelines prohibit surcharging the consumer. But, no one is enforcing those. Of course, this reminds me of an earlier post about Visa rules being ignored right under Visa's nose;

What do you think?

BTW, I am going to dispute this transaction. I tried cancelling it afterwards following the instructions in the text by texting back "STOP" and even got a text seemingly confirming that the transaction had been "discontinued", but since the 16 credits I bought did not get taken from my Facebook Credits balance, I am presuming either this is a delayed process or simply does not work. I will call the mobile payments company first and see how they handle it. Then I guess I get to call Facebook and then if all else fails, AT&T. Stay tuned!

Saturday, July 10, 2010

Mobile Payments ... Uuh?

There is a lot of buzz in the "mobile payments" space. But, of course, there is also a lot of BS. But, the issue for this post is simply the issue of the category name. Unfortunately this term has come to be used for such a wide variety of types of payments that it has totally lost its meaning. Just because a credit card processing app happens to sit on an iphone, does that really qualify as some kind of breakthrough? As they would say in S. CA - pleeeeeeeeeeeeeeeeeeeease!

Of course, if you are out looking for money or free PR, you want to be associated with a hot category. And the pundits just eat it up.

So, I have not written in awhile since I just switched to a Mobile Payments company. ha ha!

Actually, we are doing REAL mobile payments where the charge is placed on the wireless carrier bill, not just using some mobile device as a proxy for a credit/debit card.

Tuesday, May 25, 2010

Facebook's Rich Valuation Based On E-Payments

Facebook's Rich Valuation Based On E-Payments That May Never Come

This is an entertaining article. Anyone who lists Obopay as a leader in this domain is only looking at it from the perspective of having raised a lot of money versus actually accomplishing anything in the market. And, while Amazon is an incredibly successful ecommerce merchant, as a payment platform provider to others, not so much. PayPal, no argument. And as compelling as Facebook is to some, the likelyhood that if neither Google or Amazon can make their payment initiatives meaningful after pouring hundreds of millions of dollars into them, take a guess at my prognosis. There is nothing wrong inherently with Facebook credits, but it is unlikely to rock the payments world. It is just another layer on top of an already complicated and competitive landscape. p.s. As others have found out, the devil is in the details and the devil is expensive in the form of customer service and managing fraud and disputes. Playing around in your social network is entertaining and sometimes productive, but when you touch the user's wallets the rules change.

Wednesday, April 21, 2010

Paying with Plastic -

Paying with Plastic -

Just read this free first chapter and based on my knowledge of the payments industry it is one of the best I have read. Great job!

Visa paying $2B for payments processor CyberSource

Congrats to CyberSource!!!
I take a great deal of pride from having developed, signed and managed the relationship with Visa 11 years ago in spite of much skepticism both internally and externally!!! Visa invested $1.5m in CyberSource pre-ipo and agreed to the joint product, CyberSource Advanced Fraud Screen Enhanced by Visa. :-) Oh, the stories I could tell you!

Thursday, April 15, 2010

Data Portability in a PCI Crazy World!

I have written previously about service providers such as gateways and payment processors holding their customers data hostage using PCI as the excuse.

There are two new efforts underway to raise the awareness of these inappropriate practices;

Please check out these two web pages and join the Google group on the subject.

Welcome your feedback!!!

Note - that the story I wrote about last fall is still not resolved.

Tuesday, April 13, 2010

Do Not Assume Payment Methods Are Universal! Neither Demographically or Geographically!

One of the challenges we all face is being able to step out of what works for us and understand what any one or group of our customers is going to have a preference for. This is especially true for payment choices. The closest thing we have to “universal” in ecommerce is Visa/MasterCard. But, if you are selling to Germans, you better support something called ELV which is a form of direct debit or move on to another country. And, as a person with a marketing degree I have a hard time saying this, but surveying your customers to ask them what payment methods they want or what is most important about those choices, may lead you down the wrong path. What people say they want and how they act in this regard can be significantly disconnected. ie; Is security important to you? Who is going to say “no”? But, many payment methods have fallen flat on their face if the hurdles to usability are significant due to security. What was one of the things that made PayPal grow incredibly fast? All you needed was an email address. Of course, their fraud rates were through the roof too but they had the luxury of taking in a whole bunch of VC money and being able to tolerate the cost and eventually they dug themselves out of the hole. Two of the most important questions you have to ask yourself are; 1) what is my target demographic and 2) what geographies do I want to serve? Then and only then can you seriously research the options and start making decisions about what to offer.

Monday, March 29, 2010

More on New Text Alert System...

So, there it was this morning, the email from Wells about this transaction that took place last Thursday.

The only comment that I would make about this new mobile text alerting system from Visa that Wells has now deployed is that it should have been automatic that when I enrolled for that, the previous (and mostly useless) email alerting enrollment should have been cancelled or at least I should have been able to modify/cancel it.

My guess is that I was actually enrolling for the mobile alerts on a Visa hosted page, branded Wells Fargo. Even if it is not hosted by Visa on Well's behalf, it is clear that the two systems are not in synch. I had to go this morning and de-select the overlapping alerts. The site is; .

Referencing my background dealing with Phishing issues (ie; PassMark Security), the Catch-22 with all of these things is the possibility that something potentially good, like these real-time text alerts, can be just another oppty for phishing attacks. A url like the one above could (or should) make someone like me suspicious of if I am really at a legit Wells Fargo page or not. It is also interesting to note that Wells (or Visa) chose not to invest in a "secure" url for such a sensitive page as this. You know those green urls from Verisign and others called Extended Validation SSL Certificates. While I do not put much stock in these (or any of the "trust" seals), I doubt they cost considerably more and I guess they cannot hurt.

Thursday, March 25, 2010

Fair is Fair....Hats off to Visa...Genuine progress in fraud prevention!

Wells Fargo announced a few days ago that they were taking advantage of a new Visa feature. Of course, I had to immediately enroll. You then receive text message alerts when certain types and size of transactions occur. The idea is that if it isn't you, you can immediately respond and become part of the fraud prevention paradigm. I was somewhat skeptical, as usual, but as it turned out hours later I was picking up my wife's BMW from the shop (ouch $1200!!!) and while I was still standing at the check-out desk, my phone got a text reporting the transaction to me. It was very descriptive, telling me that my "Wells Fargo Card ending in xx was used at xxx Motors in xxx town for $xxxx.xx ....

This is real progress.

I had previously enrolled in their alerting offer but due to the number of different acquirers and issuers and the batch nature of credit card processing, these often did not arrive until days later.

Since, Visa's switch is involved in the authorization of all Visa transactions, these alerts can go out literally in real time.

Of course someone will try and call this a mobile payment! (see my article in Venture Beat!)

Sunday, March 7, 2010


Interesting tidbit in the WSJ yesterday - The Fed is down to one site in Cleveland, Ohio from forty five sites 7 years ago that processed paper checks. I specifically recall sitting with the CEO of the company I worked for back in the early '80s as he proclaimed we would be completely checkless within that decade. And you wonder where I get my skepticism about the pace of change in payments!!!!

Monday, March 1, 2010

FasTrak...example of over the top login protocols

The other day I went to log in to my FasTrak account online. I was amazed at how unfriendly their approach to the simple act of logging in was. It reminded me of how something that should be very standard, has taken on a life of its own and god bless them, but developers and bureaucrats left to their own devices, will get this wrong more often than not.

Instead of a simple username/password, with perhaps some underlying risk based analysis and if suspicious maybe some add'l authentication step, they first make you select one of three different username schemes that you have set up (as if you are going to remember which one you chose) and then once you work through that, they make you pick a 6+ digit password with not only a mix of letters and numbers but one letter has to be capitalized (as if you are going to remember). Then, the icing on the cake, is they force you to enter a CAPTCHA on every log-in.

Now, if I was logging in to NORAD, this approach might be remotely reasonable, but FasTrak?

Wednesday, February 10, 2010

Starbucks Mobile Card ... Perhaps What's Next in Payments

...or an example of something that meets the criteria...
People are always asking me, what is the next big thing in payments?
It is easy to identify the unlikely candidates, the pattern is common.

But, when something resonates immediately, you gotta give it an atta boy!

I am a recent iPhone convert and one of the apps I downloaded was the Starbuck's Mobile Card. I already was carrying a Starbuck's pre-paid card and had an existing account at and had registered the card. I often exchange my Wells Fargo Visa card points for those cards.

Yesterday, I was in the heart of Silicon Valley and stopped for a quick meeting at the Starbuck's on DeAnza (near Apple HQ). I noticed the POP signage for the new payment trial and decided to try it. The clerk was well versed and enthusiastic about me using it. With iPhone already in hand (where it is most of the time), I clicked on the app. Since it was my first useage there was one extra step which the clerk took care of with one touch to the screen. Then the bar code showed up on the phone screen and by simply putting it in front of the reader on the counter, the transaction was done!

Saturday, January 30, 2010

Mobile Payment - Tipping Point?

The type of mobile payment I am talking about is the REAL kind, where the purchase shows up on your mobile phone bill. Now, as it relates to the purchase of content such as a ring tone whose sole purpose is use on the mobile phone itself, my opinion is - who cares? What I am writing about is the purchase of content or services that our outside of that realm. And, to further clarify, I would like to focus on what I refer to as Mini-payments ($2-$5) and especially on Normal-payments (>$5). Micro-payments are $1 or less.

I did find out that the Haiti donations are being handled completely differently than regular mobile payments for all the ring tones and digital goods being purchased. In other words, the vast majority of the $10 is going to get to Haiti (eventually).

The downside is that with all this positive attention paid to this method of payment and potential spill over to more people (who otherwise could easily pay with a credit card/Paypal) buying their digital goods with a Mobile payment, the merchant is going to lose roughly 47% of their revenue.

Now, in places like S. Korea where mobile payments have become mainstream, even for physical goods, the merchant pays roughly double what they pay for credit card transactions.

So, the question is, will Mobile payments (in the US) continue to cost the merchant approx 50%? If they do, then this moment will just be another blip and the mobile carriers will miss out on the biggest opportunity in their lifetime. Real mobile payments priced reasonably are the only real alternative payment threat to the card brands and PayPal.

(Note - I pay my mobile phone bill with my credit card!!! Interesting twist to this discussion?)

Friday, January 22, 2010

Text donations for Haiti?

It is wonderful that so many people have been inspired to make donations to Haiti and this has brought a lot of attention to the use of Mobile Payments to achieve this. (I made a donation the old fashioned way via my charitable trust account which will probably be paid by check to the Red Cross.)

In some ways this latest phenomenon reminds me of the people that lined up to give blood after 9/11. The problem was that sadly, not much blood was needed and a lot of it went to waste and with no crisis at hand, we are back to the mode where the agencies that collect blood have to beg people to come in for donations. Yes, I give blood regularly! (& if you can you should too).

The point here is that I wonder how much of that $10 is getting to Haiti? Normally payments by text messaging methods cost the receiver ~50% off the top and take 6-9 weeks to be received since the carriers wait to pay out until they collect from the consumer. Now, I have heard that at least in the case of Verizon, they were not going to wait. But, I have not heard if the carriers are waiving their fees or most of them?

The credit card industry has surely taken some criticism, some deserved, some not, over the last year or two. But, compared to mobile payments, they are much more cost effective and efficient. The fees are generally ~2-3% and the funds usually get to the merchant within 2-4 days. And of course, the dinosaur of all payments, checks, well we won't even go there. Those are close to free and if using the ACH almost as fast (wonder why PayPal tries to get you to use this as a funding mechanism!!)