Mobile Strategy » Mobile Banking

Accelerating the Mobile Impact – The relationship between mobility and GDP

Jose HC — Fri, 25 Feb 2011 07:00:59 +0000

Today only 59% of the world’s population uses mobile phones. That means nearly 3 billion people are excluded from the mobile economy. This number is far too large to be a problem; it has to be an opportunity.

A 10% increase in mobile penetration leads to a 1% increase in low to medium income GDP. That means if we put mobile phones in people’s hands, we have an opportunity to add approximately US$160 billion to the global economy. But is that it, or can we add more?

According to a model developed by Bell Labs and the World Economic Forum, with the right combination of actions and investment, we can accelerate the impact of mobility by as much as 36%, measured in GDP.

The model predicts how mobile policies, applications, technology, and economics can impact the future. The team found that while mobile broadband is a good thing for economic and social growth when we combine it with the right applications it gets even better.

Driving adoption

Mobile networks provide access to people, markets and services. They provide a means to connect more people to the growing digital economy. This is especially important to developing countries and rural areas.

Developing countries now comprise 86% of the world’s population, and over half the people in those nations are living in rural environments. Mobile access in these areas is still far behind adoption in developed regions.

People in emerging markets are only half as likely to have access to mobile communications as the residents of developed countries. And fewer than 10% have Internet access, far below the global average of 23%.

If we can provide more people with mobile access, we can grow economies and improve lives. Numerous studies have demonstrated the impact of mobile penetration on GDP growth.

Brought down to an individual level, GDP per capita is an indicator of standard of living. GDP is used along with data on life expectancy and education to calculate Human Development Index scores. Mobility affects GDP and can be a tool to drive social benefits such as education and healthcare into underserved areas.

But accessibility can be a challenge because the economics for serving rural and low-income populations are tough. As a result more countries such as – Australia, Singapore, Malaysia, Mexico and New Zealand – are starting to drive digital economy agendas. These initiatives call for substantial investments in infrastructure. Like any investor, nations want to maximize their return.

According to the World Economic Forum and Bell Labs, 3 main factors will drive the largest returns.

Rethinking infrastructure. With current traffic and technology adoption patterns, our team predicts many urban networks will soon be overloaded. Conversely, many rural areas are underserved. Mobile access today is not ubiquitous. To achieve ubiquity quickly, we need to look at new business and green technology models that lower costs and accelerate universality.

Scaling relevant applications. We need broad deployment for certain mobile applications. One of the most telling aspects of the study is how applications can accelerate economic and social growth. We’ve seen it in Kenya with mobile payments. These sorts of applications have real social benefits and we need to find ways to scale them more quickly. The issue here is not one of innovation – it’s about broad deployment.

Developing a near-zero cost mobile device and services that are less than 5% of income. This is not new. If we want to extend mobile services to lower income communities we need to address this. Our model shows pricing has a major impact on mobile related growth. Tackling this target may seem like an impossible task, but we need to set the bar.

Revisiting infrastructure investments

The economics of traditional business models are being challenged. Organizations and governments that want to drive economic growth will need to rethink their approach to infrastructure. They will need to be creative to grow capacity and extend reach.

In rural areas, coverage will be the major concern. Developing a business model that supports cost-effective mobile service delivery will require innovative thinking and a partner ecosystem. Some rural settings do not have access to electricity, but we no longer need to choose between delivering electricity or communications infrastructure. With new alternative energy solutions, electricity and mobile can now arrive hand in hand.

In urban areas, providers will deal with staggering traffic demands. Bell Labs predicts the average number of devices per square kilometer will grow from 400 in 2011, to 12,800 in 2015. That increase in the number of users will generate a more than 30-fold increase in traffic. Scalability will be critical to ensure that networks can respond to the load and provide coverage to meet the growth.

Applications must be relevant and scalable

Countries that want to maximize growth should encourage mobile applications that support basic human needs. The more relevant the application, the more incentive people have to adopt the technology. One of the most interesting findings from the study was that not just one, but rather a suite of applications can drive growth much faster than select single applications (Figure 1). Research substantiates that technology adoption happens at a much faster rate when applications are bundled together and appeal to a large portion of the population. Education, healthcare and banking applications are important examples, but they must be simple and locally relevant. Additionally, mobile applications that target the specific needs of women in developing countries will help bridge the gender gap and address this underserved market.

Figure 1: Mobile adoption accelerates when applications are bundled and have mass appeal

Affordability is key

The higher earning segment of the population isn’t the focus here. For ubiquitous access to become a reality, affordability at the lower income level must be addressed. In developing markets, device costs combined with a monthly service charge can be a huge barrier for many. Accelerating the adoption of mobile broadband to make communication services available to all socio-economic levels means they must be affordable. When the price of the mobile solution falls below 5% of the household expenses, mobile adoption becomes much more realistic (Figure 2). However, there are a number of factors that need to come together to make this happen:

Technology vendors need to develop innovative network architectures requiring very low capital and operating expenses

Device manufacturers and content providers must develop extremely low-cost, simple interface devices with Lighthouse applications to drive uptake

Operators must work together with public and private sector organizations to create low-cost services for low-income households

Government agencies need to implement tax incentives and policies that will drive economic growth

Figure 2: Affordability is key to mobile adoption

The reality is, without a strategy that will put broadband within the reach of the low-income population, no policy will work – even for countries with a mobile broadband agenda. All of the players identified above must participate to create a feasible ecosystem to drive adoption.

A common goal for the common good

Countries that develop a mobile broadband strategy can optimize growth. But they need the right combination of infrastructure, applications and economics. According to our model, countries can drive GDP growth as much as 36% higher than an access-only approach. Simply put, when people have infrastructure and applications at an affordable price, mobile use will grow along with a country’s digital economy and its people.

via www2.alcatel-lucent.com

Posted via email from Mobile Strategy

Making Money Mobile – Of Value and Values

Jose HC — Wed, 15 Dec 2010 16:53:25 +0000

Mobile banking, mobile commerce and mobile money for us is mostly out of interest and stems from noticing the opportunity that exists in these areas – a business opportunity. For others it is about the gadgets, the novelty and the convenience. In other places around the world, mobile becomes a vehicle through which people can be brought into the formal economy. It is about a lot of things – safety, economic inclusion, survival, the opportunity of a better life!

Value in mobile takes on a completely different meaning in other parts of the world. We prepare ROI studies and company valuations over here to prove value. Over there value is about every day living. Kind of neat.

We forget about it over here (where ever that is for you). So it is both appropriate and inspiring to include the video below at this time of the year. The busiest December for me in a very long time can easily turn into a December in which I focus on myself and work and forget about others…

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Growth In Mobile Banking Adoption Will Be Driven Mainly By Smartphone Apps

Jose HC — Mon, 18 Oct 2010 19:14:40 +0000

Since banks like Bank of America launched native iPhone apps for Apple’s app store in late 2008, there has been an ongoing discussion about whether the future of mobile banking will be dominated by native apps or browser-based services.

With the adoption of smartphones that let people download mobile apps (like iPhones, Andoid phones, and BlackBerrry devices) still being small today, banks will need to continue offering browser-based mobile banking services to reach most of their customers. But with smartphone ownership growing fast, I expect that most growth in mobile banking adoption will come from native apps and not from browser-based services in the coming years because:

1) Native mobile apps offer a much more compelling mobile banking user experience:

Apps are easier to find. App stores have become an important way for consumers to discover content. To find a mobile app, customers simply need to search for the bank’s brand name in the app store. Furthermore, mobile banking apps often appear in the list of most popular free apps — which creates additional promotion. Banks promote their native apps heavily since it positions the firm as an innovation leader and associates their own brand to other popular brands like Apple. By contrast, it is more difficult for customers to find out about their bank’s mobile banking Web site domain. Initiatives like dotMobi, with specific domains for mobile-dedicated sites still suffer because it is not clear which sites carry the .mobi extension and which don’t. Furthermore, — since mobile search is in its infancy —searching via search engines like Google require additional effort.

They are easier to setup. Once a customer has downloaded an app, it is automatically bookmarked with an icon on the mobile’s home screen and thus easy to access again in the future. By contrast, customers who access a mobile Web site who want to save the link to the URL for future use need to take an additional step to either bookmark the link in the mobile browser or to create a shortcut on its home screen.

Apps provide better usability. Since less information needs to travel via the mobile network, most apps load and respond faster than mobile banking Web sites. Furthermore, apps’ are easier to navigate since they have only one level of navigation that is specifically designed for the user goal they are trying to accomplish. By contrast, mobile banking Web sites make use of the mobile browser’s generic navigation plus an additional app-specific navigation.

2) Native mobile apps enable banks to develop functionality that leverage the unique benefits of the mobile channel

They integrate more deeply with the handset’s hardware. Unlike today’s mobile Web sites, native apps can integrate with the handset’s core functions like GPS and camera. Apps thus enable a wider set of functionality that is unique to the mobile channel like remote check deposits and ATM and branch finders that help to find the way to the nearest ‘free’ ATM or branch. Although more advanced browsers with HTML5 will be able to leverage phone features, it will take several years until they are widespread.

Apps let banks create a ‘proactive’ channel that provides actionable information. Apps enable application developers to push notifications to the smarthpone without the app being launched. For banks, that means that a range of services can be offered that notify the customer proactively. Banks can for example show their customers when a new transaction has taken place or alert them when their account reaches a certain limit to avoid overdraft. By contrast, mobile Web sites are — like general Web sites — a reactive channel that only provides information once customers decide to access it. Apps can thus leverage some unique capabilities of the mobile channel.

via blogs.forrester.com

Nothing new here. But as I get myself in the mood of writing again I have been doing some reading. I came across this little post on the Forrester blog. To summarize… the author says mobile banking adoption will be driven more by native applications (vs mobile browser) due to two main reasons:
(1) user experience and (2) native integration.

Posted via email from Mobile Strategy

Zoompass Announcement Falls Short of ‘my’ expectations

Jose HC — Wed, 03 Mar 2010 17:17:11 +0000

I am not sure I get it at times. I know that the technology is limited and that a lot of the talk that sometimes goes around is more dreaming than real possibilities.

Today’s Zoompass announcement however strikes me more as a step backwards than a forward one. This is what happens when the initiative is carrier-lead instead of bank lead. I realize that these comments are not popular among some of my readers (I know where you work) but as a consumer I am still on the side of banks dealing with my money.

There are two things that dampen my excitement about this announcement:

The first thing is the following phrase: “payment is automatically drawn from the user’s Zoompass stored value account.” This means that you and I have to manage yet another account. However easy this may be for you… for me it is a hassle. I want the money to come out of my bank account directly! Otherwise for me it is just as easy to load my Starbucks card… or my Timothy’s card at the counter from my debit card. Am I missing something here?
The other thing is the little sticker… this could almost get me ranting a la Ewan on Foursquare. But I will not. A sticker to me seems like a step backwards. Although they talk about its attractiveness with phrases like “sleek and appealing sticker” … to me it just isn’t.

Bottom line this does not spell convenience to me.

Managing yet another account and plastering a sticker to the back of my phone.Similar Posts:

Making the Most of Mobile Through Partnerships

Jose HC — Fri, 26 Feb 2010 17:48:42 +0000

I have commented about this same topic before… to some of you personally. Just wrote a little something over at the other site but thought I would paste it here directly:

… the entire mobile banking landscape will succeed only through partnerships. Banks partnering with other service providers… (but to what extreme? And at what cost to the customer?).

A very important partnership is the one between those that provide services to the banks… Enterprise software providers, mobile app developers, system integrators – the best way to break in and go deep in mobile with a bank will be based on your partnerships with others. This is especially true for startups in the mobile space – go out and seek partnerships with providers who already have entrenched relationships with the big banks.

Success for a lot of startups in this space will be dependent on their ability to forge partnerships and alliances as they tackle the big enterprise clients. The mobile ecosystem is no longer straightforward… it is a complex web of relationships, connections, networks and partnerships.

Leverage who you know to get in where you want to get in. Leverage the relationships that others already possess to get your foot in the door.

You can develop a little app and throw it up on any of the application stores… but to break into the enterprise market (especially in finance, healthcare and government) you need to have more than a fun or cute little mobile app. You need to have much, much more than a Twitter account and recent grad pushing out tweets… you need a mobile strategy.Similar Posts:

Mobile Banking In Canada: CIBC Gets There First!

Jose HC — Thu, 04 Feb 2010 21:22:52 +0000

Remember that unfinished series about the 12 Reasons Why Canadian Banks Should Really Offer Mobile Financial Services? I don’t have a reason to finish it anymore (even though I may still do so). I wanted mobile banking in Canada… now I have mobile banking in Canada!

Canada your wait is over! CIBC has officially won the race and is the first of the Canadian Banks to offer a full-featured mobile banking application… (H/T to Mobile Manifesto).

CIBC is the first major Canadian bank to offer a Mobile Banking App for iPhone

From the Press Release:

With the launch of the new iPhone app, CIBC provides its clients with among the most extensive choice for banking across Canada with more than 1,070 branches including 7-day a week branch banking, 3,800 ABMS, 24-hour access through telephone banking, and online banking through www.cibc.com.

We have mentioned it here before – the first Canadian Bank to come out with true Mobile Banking would enjoy a competitive advantage in this market. CIBC has moved up as the new innovator in the Canadian marketplace. Often seen as the more conservative of the Canadian Banks this move may very well change that perception and instead be the bank that the others follow. Of course this needs to go beyond this one release: they will have to move from mobile banking to mobile financial services… I assume that will be in the future.

Scotiabank thought they had first mover advantage when they announced back in November that they would offer mobile banking in the Spring of 2010. CIBC instead surprised us with the announcement yesterday!

So … which one works better from a PR standpoint?

A press release announcing a future release?
Or the actual release 3 months ahead of the competition?

I think the answer is found in the quote below from Sonia Baxendale, President, CIBC Retail Markets:

“CIBC is proud to be the first major bank in Canada to offer our clients a Mobile Banking App to make banking with CIBC even more flexible on their iPhone. Whether waiting for the bus, sitting in the bleachers at their child’s minor hockey game, or having a coffee at their local coffee shop, our clients can perform their day-to-day banking transactions conveniently and securely, anytime and from anywhere they can access the internet on their phones.”

The operative phrase being – “first major bank in Canada.”Similar Posts:

Carnival of the Mobilists #202: Of Mobile Platforms, Stores, Acquisitions and Banking

Jose HC — Mon, 30 Nov 2009 07:12:36 +0000

After almost a year of following Carnivals and submitting our own entries as well it is a privilege for the Mobile Strategy Blog to host the 202nd edition of the Carnival of the Mobilists! For this week we have thought-provoking pieces, inside scoops, tough questions and overall interesting posts on a variety of topics. All of our writers provide a reflection of what is happening in the market as they discuss Mobile Operating Systems, application stores, Google’s latest acquisition (AdMob), mobile banking and mobile financial services. So let’s get started…

For this edition we welcome back MOpocket which after a long hiatus is back and sharing with us the inside scoop on Windows Mobile 6.5.1. Of special interest to Windows Mobile followers is the answer to the question: Is WM 6.5.1 real? It also includes a bonus high-level explanation on the difference between resistive and capacitive displays.

Enrique Ortiz writes a provocative piece that will surely get BlackBerry fans upset. He proposes several reasons why RIM should drop the BlackBerry OS and go with Android instead.

Over at WIP Jam Thibault interviews the CEO of Handster. What is Handster you ask? A white label provider of appstores for carriers, device manufacturers and other distributors.

MSearchGroove presents a podcast this week that opens up by declaring the exciting month of November – as an all about Android month. It does well in asking the uncomfortable question as to how many Android devices have actually shipped? It touches on Google’s purchase of AdMob and how the giant is in fact buying distribution relationships with mobile publishers more than anything through the acquisition. There is of course … go listen check it out.

This week we welcome Carnival newcomer David Eads from Mobile Manifesto who lives up to his blog’s subtitle of providing strategic insight into mobile commerce with an analysis of Scotiabank and M-Com’s announcement last week that mobile banking will be available in Canada in Spring 2010. David asks some good questions and wonders what will actually be delivered. David’s piece follows where my earlier post on Mobile Financial Services in Canada left off.

If you are new to the Carnival don’t forget to read about it here… If you want to play catchup you can read last week’s Carnival (#201) at Burning the Bacon with Barrett.Similar Posts:

Mobile Financial Services In Canada

Jose HC — Mon, 16 Nov 2009 05:45:54 +0000

My intent was always to provide a recap of last week’s inaugural Mobile Money Canada conference. I was going to review the event itself, the speakers and even the audience. However much has gotten in the way of doing that for you – even though I feel a certain sense of obligation to provide you with an opinion.

But I am not going to review the event, the speakers or the audience. What I will tell you is that I did not leave the conference with a ‘good’ feeling for mobile financial services in Canada. What’s even worse is that I am not even sure why I have that feeling.

The most important question I wanted insight on was – what’s the holdup in Canada? The real holdup? I was hungry to hear the experts. I was there both as a consumer and as a mobile strategy practitioner. My question was not answered but if I look at the thirteen lessons I walked away with it gives you a pretty good idea as to what the holdup is in Canada. If you want the less cynical recap the link is provided at the end of this post.

Thirteen things I brought back from the conference:

Be leary of experts… they are usually trying to sell you something.
Everyone is an expert!
Don’t trust most of the numbers thrown at you. Be very careful when figures are used and read between the lines. If adoption numbers are not freely offered there is a good chance that adoption is poor.
Too much time is spent trying to build partnerships and alliances…
Too little time is spent on understanding the customer!
Too much time is spent patting ourselves on the back for a mature mobile infrastructure.
Too little time is spent on understanding why the industry is where it is…
The carriers claim (and actually appear offended) when it is insinuated they want to own the mobile financial consumer. Why do you get so defensive anyways? The dumb pipe complex perhaps?
There is much disagreement on the maturity of mobile financial services in Canada.
Some folks will tell you that mobile financial services in Canada are highly advanced (and they say this with a straight face).
However, some financial services insiders tell me their clients are not even close to investing in mobility until they feel more comfortable with the market.
It is hard to know who to believe (since everyone is an expert).
And for lucky thirteen – don’t believe anyone. If you are buying, do the research yourself.

I walked into the conference thinking that Canadian banks were simply slow or even negligent for not moving faster on mobile financial services. But I walked out understanding that the Canadian ecosystem is complex, filled with misinformation and really much more immature than I thought. So although the banks are moving quite slowly – I can now see that the carriers and the vendors are not helping the situation. What Canadian Banks (BMO, TD, RBC, Scotiabank, CIBC…) need is a mobile strategy. A road map to help them navigate through the fluff, the noise and the hoopla.

I realize that no one is going to make a decision on a vendor after seeing a couple of presentations and hearing a few panels at a conference … and that is a good thing.

A very good thing.

Now don’t get me wrong… Overall I am still very hopeful. The vendors in the room were all very smart and knowledgeable. They are capable of great things and if they ever actually do meaningful work in Canada I am sure it will be great…

But if you read between the lines of what is going on, you turn some rocks and you ask lots of questions – you will probably agree with me.

What am I missing?
Do you disagree with me? Please do…
Please share your thoughts below…

I do want to thank the organizers for allowing me to attend and for pushing the conversation forward. Their summary of the event can be found here. Hopefully they will still invite me next year and may even allow me to be a partner… it’s nice to have different opinions isn’t it?
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Mobile Financial Services Week – Submit Your Story

Jose HC — Thu, 05 Nov 2009 17:18:33 +0000

Next week is the Mobile Money Canada Conference. To coincide with the event and to celebrate the fact that mobile financial services in Canada can only get better I would like to invite you to submit your stories and experiences to this blog. You can even submit your product or service and we will profile them here. Any of the areas under mobile financial services are welcome (this includes mobile money, mobile payments and mobile banking).

Contact me through our contact page or through the comments and we can connect.Similar Posts:

Mobile Strategy Site Visitors and Mobile Themes

Jose HC — Thu, 05 Nov 2009 13:11:23 +0000

In an effort to understand why some of you visit the Mobile Strategy Blog I have done a quick analysis of the search engine referrals. Of course this is a circuitous analysis because your searches bring you here due to the content and keywords on this site which are indexed by the search engines (mostly Google). This analysis merely helps me to focus further on the main topics or themes that are already bringing you here. The most important outcome of this analysis will hopefully be that it forces me to drop some of the filler that I write when I am either too busy or lazy to give you some good stuff.

The dates of the downloaded stats do not coincide with each other 100%… but they provide sufficient information for our purposes.

The Searches

October 14 to 26
Extracted from Clicky – Link Below

Traffic to the Mobile Strategy Blog comes from three main sources:

Direct Traffic 30.3%
Referring Sites 39.1%
Search Engines 29.8%
Other 0.8%

Direct traffic is just that… those of you who either have this site bookmarked or know the URL by memory.

Referring sites are mostly LinkedIn, Twitter, link backs, blogs I have left comments at or those blogs that have this site in their blogroll (like Enterprise Mobility Matters and Mobile Manifesto).

You know what search engines are. The interesting point here is that 92% of the searches during this time period came from Google, 6% from Bing and 1% from Yahoo.

The Keywords

October 14 to 26
Extracted from Clicky – Link Below

We could slice these in different ways and there are too many (including onesies) that do not add that much value to your searches but that in the right combination still brought some of you here. The top 5 keywords used during searches on this site for this period were the following:

mobile 22%
strategy 9%
banking 5%
application 4%
canada 3%

The top 5 or all of the individual keywords that brought readers over here during this period do not really tell the story so let’s get to the exciting stuff below.

Mobile Strategy Themes

October 14 to 26
Extracted from Clicky – Link Below

This is what I did:

Took the entire list of searches
Filtered out nonsense and mistakes
Classified the remaining ones into main themes

And these are the mobility themes that brought searchers to this blog with their corresponding weights:

Mobile Strategy 33%
Mobile Banking 20%
Mobile Application Development 18%
Mobile Analytics 7%
Enterprise Mobility 6%
Mobile Ecosystem 5%
Mobile Venture Capital 4%
Other 6%

From this I can only assume that visitors to this blog that do not come through searches are also drawn here by the same content and themes. As much as possible we will try and focus on the first three themes (mobile strategy, mobile banking or financial services and mobile application development). However we will also give it our best shot to provide you relevant links and interesting stories on the next four topics which are still very interesting to us (mobile analytics, enterprise mobility, mobile ecosystem and mobile venture capital).

Hope this helps you as much as it did me.
If you want to see something specific here please drop a comment below.

Get Clicky
Of the four different analytics programs (non-mobile) that I use here my favourite is Clicky Web Analytics. If you are interested in checking it out you can use my little code – here Get Clicky.