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Isis, MCX, others butt heads on future of m-commerce

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SAN DIEGO--CTIA President Steve Largent cited a recent Forrester study that said m-commerce sales on smartphones alone would reach 11 billion this year before blossoming to a hefty 45 billion by 2017. He then clarified that reaching that number would not be without its own challenges--a sentiment echoed by the speakers at the final keynote at the CTIA MobileCon trade show here.

The roundtable discussion included four major players from different parts of the m-commerce ecosystem: Dekkers Davidson, head of mobile commerce business for Barclaycard US; Ryan Hughes, CMO at Isis, Mike Love, EVP and CTO at Mozido; Dodd Roberts from the Merchant Customer Exchange (MCX); and Tayloe Stansbury, SVP and CTO of Intuit.

The general consensus among these men was that no one was really sure when mobile commerce would really blossom and what it will take to get the general public to adopt the associated technology.

"A lot of people feel we're in the middle of our wallet wars phase," said Mozido's Love. He later added: "One of the biggest things that all of us are dealing with is customer adoption and getting people to adopt to this mobile payment ecosystem."

"What we're seeing here is that we're on the precipice of what's about to happen," said Hughes. Customers want the "flexibility to use the cards that are in their mobile wallet" and they "want to be able to shop in the merchant locations that they want to shop at." A lot of companies will need to come together before the customer will be enticed by this, the Isis CMO explained. Isis, the nationwide m-commerce network spearheaded by Verizon Wireless (NYSE:VZ), AT&T Mobility (NYSE:T) and T-Mobile USA, is reportedly starting consumer trials in Austin, Texas, and Salt Lake City markets on Oct. 22.

"One of the challenges for merchants and the reason for MCX...is the tendency to just port the mobile payment system into the mobile phone...it's not a good idea to port that from a physical world to a mobile paradigm when we have the opportunity to make a lot of improvements," said MCX's Roberts.

MCX is the latest player to dip into the mobile payments game. Initially announced in August, MCX is a cross-platform mobile app supported by retailers including Walmart, Target, Best Buy and a variety of other players.

Roberts explained that MCX's members saw the mobile commerce market developing in a "clunky" manner. He said users will want to use the same system everywhere they go and not be forced to use different technologies such as NFC, barcodes and smartphone apps. "The only way it will take place...[is if] everywhere you went your mobile phone can pay the exact same way with the exact same technology," Roberts argued.

Barclay's Davidson offered another analogy, calling the current state of mobile commerce the "wild west of innovation." He likened it to Lewis and Clark's expedition, and said the industry is still stuck in St. Louis. 

"I think MCX's formation is a really clarifying moment in the industry," Davidson said. "I don't see a winner taking all happening for a really long time."

Hughes also discouraged using the winner-take all mindset. "When we look at forward-looking technology, we try to pick a winner and everyone else is a loser." We shouldn't be playing that game, he explained.

The panel was unable to guess at when the mobile commerce industry will reach the mainstream. Love suggested one to two years. Davidson, however, said it was more important to define what the benchmark for success for m-commerce would be. He said a possible benchmark would be a majority of Americans having a mobile wallet, which he predicted would happen in five to eight years.

Special Report: CTIA MobileCon 2012: Complete coverage

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