M-commerce is coming of age, says Perera

16 May 2006

The increasing propensity of mobile consumers to pay for content services allied with the advent of quad-play services spells a coming of age for m-commerce, says Raomal Perera (pictured), chief executive of Irish mobile payment company Valista.

Dublin- and US-based Valista currently processes over 20 million payment transactions a month and over 150 million mobile users worldwide have access to the Valista product suite. The company has been chosen by both Red Herring and On Hollywood as one of the Top 100 Global Companies for 2005 and 2006 respectively. Since starting up in 1999, Perera’s company has implemented its technology with mobile players Vodafone, DoCoMo, 3, Orange, Tiscali, France Telecom, AOL and T-Online.

In an interview with siliconrepublic.com, Perera says that the market for payment for premium content is beginning to pick up. “It’s a combination of content becoming better and jazzier, the infrastructure getting better, handsets becoming smarter and operators beginning to make money out of the services.”

Perera also believes that mobile operators are moving away from the ‘walled garden’ approach of mobile internet, whereby users only accessed the services operators chose to host. “In the US, in particular, it is all about ‘off net’, ‘off portal’ content. It is no longer about having a walled garden but allowing content providers to sell content outside the walled garden. Operators are no longer resisting this and the market is opening up big time.”

Perera recalls a conference he attended recently where he was surprised to find a Vodafone executive talking about the virtues of off-portal content. “The big focus was all around Vodafone Live! but that is changing. The value that Vodafone sees is people using its network.”

Perera cites France Telecom subsidiary w-Ha as a prime example of a mobile content player active in m-commerce. “In a strange way it can be described as the internet version of the old Minitel service. w-HA on average does about 400,000 transactions a day, peaking at 650,000 transactions. They have some 12 million live, active users and some 1,500 merchants that supply various types of digital content ranging from ringtones to music downloads, games and wallpaper.”

Perera says that the ability for users to bill for such services back to their internet service provider (ISP) or mobile operator is opening up the market to various alliances between operators and sets the stage for the onset of quad-play services consisting of TV, broadband, fixed-line telephony and mobile telephony.

In recent weeks Valista has developed a revenue settlement engine (RSE) to enable mobile carriers, ISPs and MVNOs (mobile virtual network operators) to view real-time ‘revenue reversal’ of a transaction, which dramatically reduces disputes between partners and eliminates the revenue leakage that often results.

He adds that the current hype surrounding mobile TV is premature insofar as the content is more likely to arrive in the form of clips rather than whole episodes of programmes. “Devices like the PlayStation portable have fantastic screens but I can’t see someone watching TV on a screen that size all the time. If anything the trend for TV is going in the opposite direction towards high-definition TV with screens getting bigger and better.

“People constantly make the mistake of hyping technologies like mobile TV. It’s the user experience and value to people that’s important. WAP is actually a huge success today but it took seven years. Multimedia messaging (MMS) is not a success yet. People tend to hype the technology before figuring out whether the infrastructure is ready or not,” Perera said.

By John Kennedy