Mobile Payment and the Charging of Mobile Services

According to the sweeping enthusiasm that characterized much of the news reporting in the years 1999 and 2000, mobile phones should by now have been firmly established as payment terminals in the most diverse fields. However, reality today is a different matter. Mobile payment as an established payment system seems to be a distant prospect in the case of most countries. Since the mid-1990s there have been serious efforts to use mobile phones for payment processes. The starting point for these considerations was the fact that mobile phones are particularly suitable for conducting payment processes due to their specific characteristics, high diffusion in population, and users’ positive attitude towards them (e.g., Henkel, 2002). In recent years several studies showed that customers in principle take an interest in mobile payment (e.g., Khodawandi, Pousttchi, & Wiedemann, 2003; Eisenmann, Linck, & Pousttchi, 2004). A further study bridged the gap of these and other studies’ explanatory power, and confirmed a high interest also in the total population. During a representative study in September 2004, 49.6% of the German participants indicated that they are interested in and willing to use mobile payment (MobilMedia, 2004). The commercial history of mobile payment procedures is short, but simultaneously characterized by rapid development. One of the first commercial mobile payment procedures was launched by the Finnish mobile network operator (MNO) Sonera in 1997. Customers were able to pay for goods at vending machines (Dahlberg, Mallat, & Öörni, 2003). New technological innovations used in mobile payment procedures and new use case scenarios for mobile payment have been developed at an increasingly fast pace ever since. Among the leading countries in mobile payment are Austria, South Korea, Singapore, Norway, Spain, Japan, Finland, and Italy, in which end-to-end solutions and clear business models have proved to be sustainable after four to five years of field trials and pilot projects (Taga & Karlsson, 2004). However, in other countries the situation is disillusioning. For instance on the German market (which is not only the most important European market, but also a good sample for developments in many western markets), banks (e.g., Payitmobile), MNOs (e.g., Genion M-Payment), as well as quite a number of specialized intermediaries (e.g., Paybox, Geldhandy, or Street Cash) tried one’s luck in recent years. Also the vertical alliance of the four large-scale and internationally active MNOs—Orange, Telefonica Moviles, T-Mobile, and Vodafone—was not able to start its integrated mobile payment system Simpay. When it was initiated in 2002, the primary objective was to introduce a pan-European mobile payment system for all payment scenarios. However, after six months a smaller compromise was made: providing a solution for their most urgent problem, charging mobile services, and additionally enabling payments for digital goods on the Internet. Also this did not come off. After numerous delays and intestine strife between the founders, Simpay finally stopped its activities in the middle of 2005 (Pousttchi & Wiedemann, 2006). Thus, it can be concluded for the majority of countries that most mobile payment procedures were quit after the test stage, and procedures that came into the market had some diffusion, but outside of Asia, not many of these can be categorized as economically successful, although the preconditions for acceptance of mobile payment by customers are very good.