News and insights from this week in the Mobile Money industry, by Monitise Director of Market Intelligence, Andrew Griffin.
We’re at the tail-end of quarterly reporting. Groupon beat expectations, though profitability almost halved. The company reported that 45% of transactions were via mobile. On the mobile operator side, Telefonica, which at 247 million mobile subscribers has over twice the number of AT&T or Verizon, sees Europe under pressure with revenues down 7% (pretty normal for a European MNO operation) but up 11% in Latin America, their other main market. In fact, Brazil just became Telefonica’s biggest market. Their model of ceasing to subsidize phones in Spain has been successful, with a -16% revenue decline but flat cash-flow year-over-year.
The big story late last week was the departure of Google’s mobile wallet chief ahead of the big annual Google IO conference. Back in 2011, PayPal complained bitterly to Google for stealing Osama Bedier to head their wallet project. He’s now left for unspecified reasons and in the words of Yankee Group: “Two years after launch, Google’s initiative remains stagnant”. At the last minute, Google reportedly scrapped plans to launch a physical credit card at Google IO. They did, however, announce two new Google Wallet product features:
- P2P via Gmail: Integrating Google Wallet with Gmail, this gives users the ability to send and receive money from within Gmail using an “attach payment” button. There is a 2.9% fee charged to the sender for card-funded payments and free via ACH for bank accounts linked to Google Wallet; there is no cost to receive funds.
- Instant Buy API: An extension of the “Buy With Google” function (that allows users to pay more quickly on eCommerce sites by automatically filling in all fulfillment details/payment credentials) to Android native apps. When integrated into the mobile app, the API provides payment info in just a couple of clicks, simplifying purchases made through a mobile app. MobilePaymentsToday described it as similar to Braintree’s Venmo functionality.
Though the new features are aimed primarily at PayPal (which also allows users to send and receive money via email), this is yet another example of non-banks muscling into the financial services space.
Monitise has products covering both of these segments for its FI customers and other companies. We prefer mobile phone numbers over email addressed-based P2P (phone contact lists typically have more numbers than email addresses); undoubtedly, Google will eventually move that way too, as otherwise the mobile user presumably would have to use the Gmail app to make payments (not a problem on Android, but perhaps less common on iOS). Monitise’s instant mobile checkout functionality (brought in-house when we fully acquired Mobile Money Network in 2012) aims to bring instant-purchase into the mobile banking app and thus to millions of our end users, all within the mobile banking app, which is rapidly morphing into a mobile wallet.