GSMA backs NFC as UK MNOs flag collaboration

By Pamela Weaver

Vodafone, Orange, O2 and T-Mobile have announced their intention to launch NFC mobile payment services in the UK by 2012. Near-field communications (NFC) has been building a head of steam in recent months, with the likes of Google, RIM and Visa announcing their support.

Apple’s recent hiring of NFC expert Benjamin Vigier has sparked rumours of NFC capability in the next iPhone; with operators fighting a seemingly losing battle on the app store front, it looks like handbags are set to be drawn in the race to the consumer’s pocket at the corner shop.

In a move that Apple fans are likely to interpret as confirmation of Cupertino’s NFC intentions, the GSMA issued a statement on Monday in which it committed itself to the launch of commercial NFC services “in select markets” by 2012. The GSMA has called for standardisation and interoperability in the interests of preventing market fragmentation, but for many operators, NFC is something of a last-chance saloon in terms of getting a share of the e-commerce applications market currently dominated by likes of Apple and Google. By tying transaction security closely to the SIM, operators can inveigle themselves between customer and service in a way that pays off.

In recent times, the operators themselves have been viewed as the key obstacle to NFC deployment, but this looks set to change, presumably thanks to a market valued by Frost & Sullivan recently at more €100bn by 2015. As Deutsche Telekom CTO Ed Kozel told Bloomberg on Saturday: “Google’s massive but it does not have a billing relationship with 99 percent of its customers. That’s our opportunity.”

Former Google CEO Eric Schmidt disagrees about his firm’s role, but shares Kozel’s enthusiasm for the sector. At the Mobile World Congress on February 15^th last, he described mobile payments as a “mega-scale opportunity for us.”