MOBILE PORTALS

A mobile portal is a customer channel, optimized for mobility, that aggregates and provides content and service for mobile users. These portals offer services similar to those of desktop portals such as AOL, Yahoo!, and MSN (See en.wikipedia.org/wiki/Mobile_portal for additional discussion of portals.) An example of the best “pure” mobile portal (whose only business is to be a mobile portal) is zed.com from Sonera in Finland. The world’s best-known mobile portal, with over 52 million members, mostly in Japan, is i-mode from DoCoMo.
The services provided by mobile portals include news, sports, e-mail, entertainment, and travel information; restaurants and event information; leisure-related service (e.g.,games, TV and movie listing); services; and stoke trading. A sizeable percentage of the portals also provide downloads and messaging, music related services, and health, dating, and job information. Mobile portals frequently charge for their services. For example, you may be asked to pay 50 cents to get a weather report over your mobile phone. Alternatively, you may pay a monthly fee for the portal service and get the report free any time you want it. In Japan, for example, i-mode generates revenue mainly from subscription fees. A special service for travelers is offered at Avantgo (from iAnywhere)
Example AvantGo (described earlier) is the world’s largest mobile Internet service that delivers rich, personalized content and application to PDA, wireless PDA, and Smartphone users. Today, hundreds of major media brands and marketers deliver their online content through the AvantGo mobile Internet service portal.
In addition, over 50 major marketing brands use AvantGo mobile advertising to target and reach a valuable trendsetter audience of over 7 million unique users. For more details, see avantgo.com/biz/aboutus/index.html.
Increasingly, the field of mobile portals is being dominated by a few big companies. The big player in Europe, for instance, are companies such as Vodafone, Orange, O2, and T-Mobile; in the United States the big player are Cingular, Verizon, AT&T, and Sprint PCS. Also, mobile-device manufacturers offer their own portals (e.g., Club Nokia portal, My Plam portal). And, finally, the traditional portals (such as Yahoo!, AOL, and MSN) have mobile portals as well. For example, google Mobile provides news, e-mail, and more to cell phones.
Sina Corporation, a major portal network in China (sina.com), in its Sina Mobile, offers mobile value-added service including news and information, community service such as daring and friendship, and multimedia downloads of ring tones, pictures, and screensavers. Users can order these service through the sina website or through their mobile phones on either a monthly subscription or a per message basic.

7.3 Mobile Shopping, Advertising, and Content-Providing

M-commerce B2C applications are concentrated in three major areas-retail shopping (for products and services), advertising, and providing digitized content (e.g., music, news, videos, movies, or games) for a fee via portals. Let’s examine these areas.

SHOPPING FORM WIRELESS DEVICES
An increasing number of online vendors allow customers to shop from wireless devices. For example, customers who use Internet-ready cell phones can shop at certain sites such as mobile.yahoo.com or amazon.com. Shopping from wireless devices enables customers to perform quick searches, compare prices, use a shopping cart, order, pay, and view the status of their order using their cell phones or wireless PDAs. Wireless shoppers are supported by services similar to those available for wireline shoppers.
An example of food shopping from wireless devices is that of a joint venture between Motorola and Food.com. The companies offer restaurant chains an infrastructure that enables consumers to place an order for pickup or delivery virtually anytime, anywhere. Donatos Pizzeria was the first chain to implement the system in 2002.
Cell phone users can also participate in online auctions. For example, eBay offers “anywhere wireless” services. Vendio and gNumber partnered to provide mobile eBay applications and PayPal introduced its pay-by-phone service. The ShopWiki Mobile Search engine is accessible from a PDA or cell phone browser. It allows you to compare prices of online stores and then buy from any physical location. ShopWiki serves 60 million products from more than 180,000 stores (Comiskey,2006).
M-commerce in Japan is growing exponentially and now represents the largest amount of m-commerce sales in the world. Over 60 million Japanese are buying over their cell phones even while riding the trains, buying, for example, their train tickets. Wireless shopping is popular with busy single parents, executives, and teenagers (who are doing over 80 percent of their EC shopping from cell phones). Cell phones allow direct communication with consumers.
Traditional retailers in Japan, such as 7-Eleven and I Holding Company, have been losing millions of customers to Web shopping companies such as Rakuten Inc. A group of convenience stores and 7-Eleven Japan co. have set up 7dream.com, offering online services for music, travel, tickets, gifts, and other goods to its 8,000 7-Eleven stores in Japan. Meanwhile, pure m-commerce operators such as Xavel Inc. (xavel.com) are growing rapidly, forcing traditional retailers such as Marui department stores to expand their e-commerce to include m-commerce.
According to the Daiwa Institute of Research (reported by Textually.org,2006), impulse shopping accounts for most of the purchases that are done on mobile phones, but only if the users are on flat-fee-based service.
An example of purchasing movie tickets by wireless device is illustrated in Figure 7.3. Notice that the reservation is made directly with the merchant. Then money is transferred from the customer’s account to the merchant’s account.

TARGETED ADVERTISING
Knowing the current location of mobile users (e.g., when a GPS is attached to the cell phone) and their preferences or surfing habits, marketers can send user-specific advertising messages to wireless devices. Advertising can also be location-sensitive informing about shops, malls, and restaurants close to a potential buyer. SMS messages and short paging messages can be used to deliver this type of advertising to cell phones and pagers, respectively. Many companies are capitalizing on targeted advertising, as shown in A Closer Look 7.1.
As more wireless bandwidth becomes available, content-rich advertising involving audio, pictures, and video clips will be generated for individual users with specific needs, interests, and inclinations.
Getting Paid to Listen to Advertising. Would you be willing to listen to a 10-second ad when you dial your cell phone if you were paid 2 minutes of free long-distance time? As in the wireline world, some consumers are willing to be paid for exposure



to advertising. It depends on which country you are in. In most places where it was offered in the United States, this service was a flop and was discontinued.
In Singapore, though, getting paid to listen to advertising works very well. Within a few months of offering the ad service, more than 100,000 people subscribed to the free minutes in exchange for listening to the ads offered by SingTel Mobile (Eklund, 2002). Subscribers to SingTel’s service fill out a personal questionnaire when they sing up. This information is fed into the Spotcast database (spotcastnetwork.com) and encrypted to shield subscriber’s identities – Spotcast cannot match phone numbers to names, for exsample. To collect their free minute – one minute per call, up to 100 minute a month – subscribers dial a four-digit code, then the phone number of the person they want to talk to. The code prompts SingTel to forward the call to Spotcast and, in an instant, Spotcast’s software finds the best ad to send to subscriber based on the subscriber’s profile

WIRELESS ELECTRONIC PAYMENT SYSTEMS

Wireless payment systems transform mobile phones into secure, self-contained purchasing tools capable of instantly authorizing payments over the cellular network. The city of Montreal, Canada, installed smart parking payment terminals that process Pay & Go mode wireless secure e –payments powered by solar panels. The parking terminals also provide information on parking space utilization to a central system (8d.com, 2006). In many countries wireless purchase of tickets to movies and other events is popular.
Micropayments. If you were in Frankfurt, Germany, or Tokyo, Japan, for example, and took a taxi ride, you could pay the taxi driver using your cell phone. As discussed in Chapter 6, electronic payments for small-purchase amounts (generally $3 or less) are called micropayments. The demand for wireless micropayments systems is fairly high. Edgar, Dunn & Company’s 2006 Mobile Payments Study found that:
• Survey respondents believe that mobile payments will reach a critical mass of consumers and become as important as other types of payments, such as credit and debit cards, but it may take 10 years.
• The most significant barriers to the adoption of online mobile payments are the transaction costs charged by mobile carriers and the limited availability of micropayments alternatives.
Payments by cell phones are becoming popular in Japan, where customers can pay train fares vending machines, etc., using their cell phones (see Foster, 2008).
An Israeli firm, TeleVend, Inc,(televend.com), has pioneered a secure platform that allows subscribers to make payments using mobile phones of any type on any cellular infrastructure. A customer places a mobile phone call to a number stipulated by the merchant, to authorize a vending device to dispense the service. Connecting to a TeleVend server, the user selects the appropriate transaction option to authorize payment. Billing can be made to the customer’s bank or credit card account or to the mobile phone bill. Micropayment technology has a wide range of applications, such as making payments to parking garages, restaurants, grocery stores, and public transportation.
Mobile (Wireless) Wallets. An e-wallet (see Chapter 6) is a piece of software that stores an online shopper’s credit card numbers and other personal information so that the shopper does not have to reenter that information for every online purchase. In the recent past, companies such as Motorola offered m-wallet (mobile wallet, also known as wireless wallet) technologies that enabled cardholders to make purchases with a single click from their mobile devices. While most of these companies are now defunct, some cell phone providers have incorporated m-wallets in their offerings. Since 2004, NTT DoCoMo Japan has been selling phones with chips in them that can be scanned by a short-range wireless reader at tens of thousands of stores. Similar capabilities using Near Field Communications (NFC) started to grow in the United States beginning in 2007 and are forecasted to reach more than half of all handsets sold by 2010 (Smith, 2006).
A handset-based service allowing consumers to send money to individuals both in and outside the United States through Western Union locations incorporates mobile wallets. That development allows, for example, users of Trumpet Mobile, a reseller of prepaid wireless service for Sprint Nextel Corp., to send money to other persons directly, without the need for prepaid cards. It also allows users to make point-of-sale transactions with their phones, relying either on contactless technology or PIN code capability. In 2008, Affinity Mobile initiated a nationwide person-to-per-son money-transfer service involving Western Union and Radio Shack Corp., whose electronics stores sell Trumpet’s phones and service.
Motorola m-wallet solutions available as of 2008 include: New Merchant/Bank Service-transaction fees, merchant handsets; Value-Added Services-person-to-person, money orders, ticketing and coupons, bill payments; and Co-Branding and Cross-Selling with banks and merchants (Motorola,2008).
Wireless Bill Payments. In addition to paying bills through wireline banking or from ATMs, a number of companies are now providing their customer with the option of paying their bills directly from a cell phone. HDFC Bank of India (hdfcbank.com), for example, allows customers to pay their utility bills using SMS.

7.2 Mobile Applications in Financial Services

Mobile financial applications include banking, wireless payments and micropayments, wireless wallets, bill payment services, brokerage services, and money transfers. While many of these services are simply a subset of their wireline counterparts, they have the potential to turn a mobile device into a business tool, replacing bank branches, ATMs, and credit cards by letting a user conduct financial transactions with a mobile device any time and from anywhere. For example, in Japan cell phones have a built-in smart card that is used for micropayments. In this section we will look at some of the most popular mobile applications in banking and in financial services.

MOBILE BANKING AND STOCK TRADING
Mobile banking is generally defined as carrying out banking transactions and other related activities via mobile devices. The services offered include bill payments and money transfers, access administration and check book requests, balance inquiries and statements of account, interest and exchange rate, and so on, and the sale/purchase of stocks.
Throughout Europe, the United States, and Asia, an increasing percentage of banks offer mobile access to financial and account information. For instance, Merita Bank in Sweden pioneered many services, and Citibank and Wachovia in the United States has a diversified mobile banking services. Consumers in such banks can use their mobile handsets to access account balances, pay bills, and transfer funds using SMS. The Royal Bank of Scotland, for example, uses a mobile payment service, and Banamex, one of Mexico’s largest banks, is a strong provider of wireless services to customers. Many banks in Japan allow for all banking transactions to be done via cell phone. For a demo, go to Wachovia.com, find mobile banking, and click on “go mobile today.”
According to CIO Insight (2007), Wells Fargo provides an increasing number of banking services to wireless customers. The major objective is to increase customer loyalty. Basic wireless services are being offered by most major banks worldwide. Among services are mobile alerts (e.g.,when your balance is low). Also, mobile browsing, downloading, and text messaging are becoming popular.
As the wireless technology and transmission speeds improve, the rate of mobile financial service increases. The same picture holds true for other mobile financial applications such as mobile brokering, insurance, and stock market trades.

WIRELESS LOCAL AREA NETWORKS AND WI-FI

As you have read in Chapter 4, wireless local area networks have been making their way to the wireless forefront. A wireless LAN (WLAN) is like a wired LAN without the cables. WLANs transmit and receive data over the airwaves from a short distance in what is known as Wi-Fi (Wireless Fidelity). Wi-Fi is described in Table 7.1 and in Chapter 4.
The Wi-Fi Revolution. In a typical configuration, a transmitter with an antenna, called a wireless access point (WAP) connects to a wired LAN from a fixed location or to satellite dishes that provide and Internet connection. A WAP provides service to a number of users within a couple hundred feet, known as a “hotspot zone,” or hotspot. Several WAPs are needed to support larger numbers of users across a larger geographical area. End users can access a WLAN with their laptops, desktops, or PDAs by adding a wireless network card. Figure 7.2 shows how Wi-Fi works. Mitchell (2008) provides a step-by-step guide for building Wi-Fi at home or in small-business settings.
WLANs provide fast and easy Internet or intranet broadband access from public hotspots such as airports, hotels, Internet cafes, and conference centers. WLANs are also being used in universities, offices, and homes in place of the traditional wired LANs (see weca.net).





The major benefits of Wi-Fi are its lower cost and its ability to provide simple Internet access. As a matter of fact, Wi-Fi is the greatest facilitator of the wireless Internet.
Illustrative Applications of Wi-Fi. The years 2004 through 2008 were a breakthrough era for wireless networking in offices, airports, hotels, and campuses around the world. Since then, each month brings new examples of businesses that have added Wi-Fi, REID, or other wireless services for their employees, business partners, or customers. Several examples are presented in Table 7.2. Many more examples of Wi-Fi are included in this chapter and throughout the book.
Despite all of the development, progress is still slow, as shown next.
Barriers to Commercial Wi-Fi Growth. Two factors are standing in the way of Wi-Fi market growth: cost and security. First, some analysts question why anyone would pay $30 a month, $7.95 a day, or any other fee for Wi-Fi access when it is readily available in many locations for free (e.g.,in certain cities, airports, and shopping malls such as in Manila, Philippines). Because it’s relatively inexpensive to set up a wireless access point that is connected to the Internet, a number of businesses offer their customers Wi-Fi access without charging them for the service. In fact, there is an organization, freenetworks.org, aimed at supporting the creation of free community wireless network projects around the globe. In areas such as San Francisco, where there is a solid core of high-tech professionals, many “gear heads” have set up their own wireless hotspots that give passersby free Internet connections. This is a part of a new culture known as war chalking and war driving (see en.wilipedia.org/wiki/Warchalking).
In Sections 7.2 through 7.6 of this chapter, we will study m-commerce applications in a number of diverse categories. A summary of the applications is provided at en.wikipedia,org/wiki/Mobile_Commerce.

MOBILE COMMERCE

While the impact of mobile computing on our lives will be very significant, a similar impact is already occurring in the way we conduct business. This impact is described as mobile commerce (also known as m-commerce), which is basically any e-commerce or e-business done in a wireless environment, especially via the Internet. Like regular EC applications, m-commerce can be done via the Internet, private communication lines, smart card, or other infrastructures (e.g., see Golding, 2008, en.wikipedia.org/wiki/Mobile_commerce, and Taniar, 2007).
Mobile devices create an opportunity to deliver new services to existing customers and to attract new ones. Varshney and Vetter (2002) classified the application of m-commerce into the following 12 categories:
1. Mobile financial applications (B2C,B2B)
2. Mobile advertising (B2C)
3. Mobile inventory management (B2C,B2B)
4. Proactive service management (B2C,B2B)
5. Product locating and shopping (B2C,B2B)
6. Wireless reengineering (B2C,B2B)
7. Mobile auction or reverse auction (B2C)
8. Mobile entertainment services (B2C)
9. Mobile office (B2C)
10. Mobile distance education (B2C)
11. Wireless date center (B2C,B2B)
12. Mobile music/music-on-demand (B2C)
For details, see mobiforum.org.
Many of these applications, as well as some additional ones, will be discussed in this chapter. For an overview, see Golding (2008)
M-Commerce Value Chain, Revenue Models, and Justification. Like EC, m-commerce may be a complex process involving a number of operations and a number of players (customers, merchants, mobile operators, service providers, and the like). Several types of vendors provide value-added services to m-commerce. These include mobile portals, advertisers, software vendors, content providers, mobile portal, mobile network operators, and more (see en. Wikipedia.org/wiki/mobile_commerce).
The revenue models of m-commerce are the following : access fees, subscription fees, pay-per-use, advertising, transaction fees, hosting, payment clearing, and point-of-traffic.
The capabilities and attributes of mobile computing presented earlier provide for many applications, as shown in Figure 7.1. These attributes are supported by infrastructure. According to Nokia’s advertising, mobility moves from productivity improvement to a strategic part of the enterprise’s IT portfolio.
Justifying M-Commerce. Justifying m-commerce may not be easy due to its intangible benefits. CIO Insight (2007), for example, reports that mobile banking is slow to adopt due to the difficulty to justify it. According to MobileInfo (2008), developing a business case for mobile computing or commerce projects is a serious and complex exercise. It requires analysis of both costs and benefits from undertaking such a project. First of all, there are a number of ways in which you can evaluate IT investment. While some of the methods are qualitative, most financial officers want quantitative analysis. MobileInfo provides a few methods. Others are provided in Chapter 17.
Microsoft developed a special calculator for wireless justification. (See the problem-solving activity at the end of this chapter.)
Impact on Enterprises. Mobile technologies not only provide convenience and efficiency benefits, but can lead in both core competencies and competitive advantage and impact entire strategies and business models. Google activities in the area are good examples.

ATTRIBUTES AND DRIVERS OF MOBILE COMPUTING

Generally speaking, many of the EC applications described in Chapter 6 can be done in m-commerce. For example, e-shopping, e-banking, and e-stock trading are gaining popularity in wireless B2C. Auctioning is just beginning to take place on cell phones, and wireless collaborative commerce in B2B is emerging. However, there are several new applications that are possible only in the mobile environment. To understand why this is so, first let’s examine the major attributes of mobile computing and m-commerce.
Specific Attributes of Mobile Computing and M-Commerce. Mobile computing has two major characteristics that differentiate it from other forms of computing: mobility and broad reach.
Mobility. Mobile computing and m-commerce are based on the fact that users carry a mobile device anywhere they go. Mobility implies portability. Therefore, users can initiate a real-time contact with other systems from wherever they happen to be if they can connect to a wireless network.
Broad Reach. In mobile computing, people can be reached at any time. Of course, users can block certain hours or certain messages, but when users carry an open mobile device, they can be reached instantly.
These two characteristics break the barriers of geography and time. They create the following five value-added attributes that the development of m-commerce: ubiquity, convenience, instant connectivity, personalization, and localization of products and services.



Drivers of mobile computing and M-Commerce. In addition to the value-added attributes just discussed, the development of mobile computing and m-commerce is driven by the following factors.
Widespread Availability of Mobile Devices. According to Romow.com (2008), 50 percent of the world population will use mobile phones in 2008. It is estimated that within a few years, about 70 percent of cell phones will have Internet access (“smart-phones”). Thus, a potential mass market is available for conducting discovery, communication, collaboration, (e.g.,see “Global Mobile,” a special report, Computer World, May 14,2007), and m-commerce. Cell phones are spreading quickly even in developing countries.
No Need for a PC. Today’s PDAs and some cell phones have as much processing power as personal computers did just a few years ago, and possess the range of software available to PC users. This suggests that the smart phone-not the PC-may soon become the foremost tool that connects people to the Internet.
The Handset Culture. Another driver of m-commerce is the widespread use of cell phones, which is a social phenomenon, especially among the 15-to-25-year-old age group. These users will constitute a major force of online buyers once they begin to make and spend larger amounts of money. The use of SMS has been spreading like wildfire in several European and Asian countries. In the Philippines, for example SMS is a national phenomenon, especially in the youth market. As another example, Japanese send many more messages though mobile phones than do Americans, who prefer the desktop or laptop for e-mail.
Declining Prices and Increased Functionalities. The price of wireless devices is declining, and the per-minute pricing of mobile services declined by 50 percent in recent years. At the same time, functionalities are increasing. Also, a flat fee (e.g., monthly) encourages more use of mobile devices.
Improvement of Bandwidth. To properly conduct m-commerce, it is necessary to have sufficient bandwidth for transmitting text; however, bandwidth is also required for voice, video, and multimedia. The 3G (third-generation) and 3.5G technologies (described in Chapter 4) provide the necessary band width.
The Centrino Chip. A major boost to mobile computing was provided in 2003 by Intel with its Centrino chip. This chip, which became a standard feature in most laptops by 2005, includes three important capabilities: (1) a connection device to a wireless local area network; (2) low usage of electricity, enabling users to do more work on a single batter charge; and (3) a high level of security. The Centrino (Centrino 2 in 2008) is making mobile computing the common computing environment.
Availability of Internet Access in Automobiles. The number of cars equipped with high-speed Internet access (e.g., see autonetmobile.com and nvtl.com) has increased and will continue to grow.
Networks. A driving development of mobile computing is the introduction of the third- and fourth-generation wireless environments known as 3G and 4G, and the adoption of Wi-Fi as a wireless local area network (LAN), WiMax, and wide area networks. They were described in Chapter 4.