Engagement

Today, telecom is simply another business using financial transaction networks to charge, bill, and reconcile revenue and cost accounts. No partnership exists in the intra-process of completing the financial transaction.  But early on, Telco developed a specific secure and isolated data network for point-of-sale credit card transactions. All early credit card transactions ran on a dedicated network.  MCI was a provider in the U.S.  If you, a merchant, wanted a point-of-sale terminal installed, you needed to request a provisioning order from a telecom. Telcos had the reach and provided the security and gained significant revenue running the dedicated network. With generic IP networks and secure VPNs, this dedicated network mostly collapsed as a significant revenue generator.

Can CSPs participate by supplying a secure transport network? Telecoms terminate mobile devices - at least when they are not paired to a WiFi LAN. Telecoms configure the SIM and authenticate the mobile device. For some devices, mobile operators must provide secure element SIM cards for token storage. These activities should provide openings to participate in this new payment system.  But caution is advised; this is a cut throat business. AT&T, Verizon, and T-Mobile sponsored a joint-venture developed platform named Softcard. When they applied muscle to get this adopted by competitive mobile device OS, Google bought up Softcard and shut this down.

Payments by mobile device open the door to many more service requirements and also service opportunities.  All the accoutrements of credit cards could be relevant to pay-by-mobile device. Someone must provide initiatives to manage fraud, risk, and compliance throughout the payment system; telecom has partnered with credit card transaction houses in developing anti-fraud technology. The payment system must constantly fight cybercrime and provide information security; both these are bread and butter for Data Telecom. On the opportunity side, the mobile payment ecosystem offers new opportunities for customer acquisition, retention, and mobile engagement.  It could become a platform for advertising and promotion, and brand identification marketing.

As mobile operators and network providers, we should become actively engaged as a partner-with-say in this opening market. Attend the standards meetings. Engage the existing minor players in partnerships with exclusives. There are many startups in the field [Urban Airship, apriva, Safe cash, CU wallet, shelfbucks, etc.]. There are many established telecom vendors: IBM, and network device manufacturers.  Perhaps even Microsoft would like a partner that could provide a special twist helping them break into the Big Three club. But principally, CSPs should provide and brand specialized NFV/SDN enabled security VPNs as the link between the mobile device app and the financial transaction network.