In line with our class conversation today, Forbes recently published an article discussing PayPal and the future of mobile payments. My opinion is that the competitors in this race are all providing a software solution for a hardware problem. Amazon, PayPal, Google, Apple, etc. all have the infrastructure and software know-how to implement a mobile payment system. The key to adoption is going to depend on the physical actions a customer has to take at a check out counter.
Paying in a brick and mortar store via your mobile device has to be both easier than a credit card and at least as secure. The hardware technology that mobile payment competitors seem to be jumping on is called Near Field Communications (NFC). The Forbes article describes a view point I agree with, "If I have to reach into my pocket for something when I’m checking out, why do I care if it’s a credit card or my phone. It’s still effort on my part."
Apart from having to take out your phone and wave it in front of some sensor, there are still the security and authentication issues. This is where PayPal steps in with Beacon. Communicating via Bluetooth, the customer never has to take their phone out of their pocket. As a security option, customers can choose to enter their personalized pin-code to complete the transaction.
PayPal is not only already positioned well infrastructure-wise to dominate this market, they now have the technology (in hardware form) to do it. They will need to capitalize on mobile payments for ecommerce with in-app software technology to round out their offerings, but dominance in physical mobile payments would help with digital mobile payment adoption.
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