News and insights from the Mobile Money industry, by Monitise Senior Vice President, Industry & Investor Relations, Andrew Griffin.
Facebook Pays $19 Billion for WhatsApp: Facebook bought the messaging service WhatsApp for $19 billion last week, or $40 for each of its 450 million users; this dwarfs the $4 per user Rakuten paid for Viber the previous week. The size of the deal surprised everyone, though it represents just 10% of Facebook’s valuation. The read-across for financial institutions is the value of audience reach. FIs are not accustomed to thinking about average revenue per account, but their mobile banking apps, if done properly, give them a high frequency-of-use, targetable audience.
BBVA Acquires Simple for $117 Million: Simple is a digital banking front-end service in the US (they used a real bank, Bancorp, to run the underlying accounts). They, along with Brett King’s Moven, are the poster-children of disruptive digital banking in the US, so many of us are finding it ironic that they have sold to a traditional bank. Simple has 90 employees and 110,000 customers (so just over $1,000 per customer). Dave Birch wins the blog title of the year award: “Nobody expects the Spanish Acquisition“.
Deloitte on the Future of Branches: The first chapter of a new report from Deloitte is entitled “Death by Digital” and notes that over 2,000 branch locations have closed in the UK over the last decade. However, 72% of UK consumers still go to the high street to access banking/financial services and Deloitte proposes that there is still a place for branches – but banks haven’t evolved branches to suit the new needs of today’s consumers.
Gartner on 2013 Mobile Phone Sales: Gartner’s annual report on mobile phone sales for 2013 confirmed what had first happened in Q2 2013 – smartphones are now outselling feature phones. Smartphones accounted for 968 million (54%) of the 1.8 billion total mobile phone units sold in 2013. Global smartphone sales grew 36% in Q4 2013. The country with the strongest growth was India (167%) and the region with the strongest was Latin America (96%). Globally, Android’s market share is 78% vs. iOS at 16%.
Visa and Mastercard Back HCE: The major networks have embraced Host Card Emulation, which is not a huge surprise given their talk of embracing standard tokenization last year. HCE is widely viewed as re-energizing NFC, which has been given up for dead, particularly in the US. Moreover, it’s not just the card schemes embracing HCE: Google has incorporated it into Android KitKat. Now we just need to see if Apple adopts NFC or not. For a good overview of HCE, we recommend this article.
China Develops National Mobile Payments Scheme: The Chinese government, through the People’s Bank of China, is testing a national mobile payments standard that was first announced back in 2011 and represents a state initiative to get the banks/schemes and telcos to work together on a SIM card secure element-based NFC platform; another objective is to avoid the (state-driven) standards mess of 3G which led to three mobile network operators having three different radio technologies.