I’m a huge smartphone fan. My family can tell you that myrelationship with my smartphone, while not as long standing andwarm as that with my daughters, certainly is a close one. Likemillions of other smartphone owners, I’ve developed a synapsebetween my brain and that smartphone (portrait below). That newnervous system extension fires whenever an even trivial question orslightly novel situation arises. What was the name of the femalelead in Teen Wolf? (I told you even trivial questions count!) AskGoogle’s Voice application. What’s the quickest way to get toRockport? Say “Navigate to Rockport, Massachusetts” and inspect themap. More important, where do I have to be at 09:00 tomorrowmorning? Check my Exchange Calendar via the TouchDownapp.
So, when my digital brain started to misfire recently, Itook it to the big box retailer I bought it from and (havingpurchased the store’s high end insurance plan) figured I’d bewalking out with a new handset and be on my way. No suchluck.
Having outsourced part of my brain, the repair experiencewas akin to losing my mind. Instead of the one or two weekspromised at the store, I was later told it would be sixunacceptably long weeks.
If you’re thinking, what does this have to with payments?Well, I’m ahead of you. Trust me. Do you know anyone else whobought a chainsaw at 11:30 at night using his phone? Amazon’smobile app is the application I hate to love. It costs me so muchin time savings and low cost. I rest my case.
Now, anyone who has followed my practice over the last fewyears knows I am an advocate for mobile payments via smartphone. Iwant NFC in my handset. I want discounts served up to me at themerchants I frequent through easily accessed, fun apps. I want myrewards and loyalty points redeemable at my favorite merchants atthe POS and not via some forced digital march to an online catalogof brands aimed at another demographic. And I know to a certaintythat the convenience of m-commerce apps on smartphones will driveconsumer demand for payments to be part of the userexperience.
But this whole mobile commerce frontier, especially theNFC future, could fall down if the device maintenance process is asgrim as mine. Yes, I complained to higher powers and got itresolved just within the promised schedule. But if we place ourpayment card credentials on a soldered-in-place NFC/SIM chipset andthe smartphone dies, how long will it take before we’re able to payvia smartphone again? And what will we do in themeantime?
Card issuing, on the other hand, needs just a 24-hourcycle time and (if you’ve got the right type of card) it can takeeven less time if instant issuance is available at your branch banklocation.
These are the nightmares that should be keeping everyonein the NFC value chain awake. And today’s mostly disconnectedsupply chain could make fast resolution for the broken brainsyndrome challenging. Customers buying their phones at the Applestore might get better results because of comparative verticalintegration. Integration could be a competitive differentiationfeature for the AT&T/Verizon/T-Mobile/Discover jointventure.
Payments and financial account access raise the stakes foreveryone. No one (especially a regulator) is going to care if youcan’t download a music file to your broken smartphone. Everyonewill care if those fundamental capabilities are lost in a repairblack hole.
