mCommerce: Ready To Roll (cont.)

How The French Are Succeeding With mCommerce

France Telecom has launched the second trial phase for "ItiAchat", which is a secure mobile e-commerce service. Some 22 vendors, seven banks and a hundred pilot customers are taking part in this test, which allows subscribers to the carrier's GSM service to make purchases from their mobile phones or via the Internet. Transaction security is guaranteed due to the special smart bankcard reader that is integrated in the handset.

France leads the world when it comes to smart cards and the economy runs on "CB" bank cards, which are issued by an inter-bank consortium. Some 35 million are in circulation and every year they process over 3 billion transactions. A few years ago the system went down during the weekend and everything ground to a halt since nobody carries cash anymore and the ATM machines were part of the problem. Thus, no petrol and worst of all - no food and drink. Merde Alors.

The near ubiquitous use of these cards is significant since it means that e- or m-business services that are based on these familiar bits of plastic are much more likely to find acceptance in the market. Moreover, the ItiAchat service is very easy to use. Customers contact the merchant (by phone or via the Internet) and place an order. The merchant sends back a GSM short message with the price, displayed on the screen of a Motorola StarTAC-D handset having the special card reader. As illustrated, the customer then inserts the CB bank card into the handset and enters the PIN number. Transaction data is transmitted with complete security to one of the partner banks, which guarantees payment to the merchant.

ItiAchat is mcommerce in a very neat nutshell. It illustrates that the whole thing comes down to trust and familiarity. Most of us trust our bank; most of us are familiar with mobile phones; French citizens don't leave home without their bankcards. The rest is just technology.

How It Works

The payment mechanism is implemented on a 32K SIM toolkit card. Here's how it works:

• (1) select a purchase, confirm the order and enter delivery address;
• (2) select mobile CB payment;
• (3) enter mobile phone number;
• (4) a few seconds later a CB payment proposal is sent via SMS;
• (5) a second SMS is sent from the phone to the merchant (this is the equivalent of swiping the card in the shop);
• (6) the third SMS confirms that the bank has accepted this transaction.

Conclusion