O2 chose not to feature Near Field Communications (NFC) in its new mobile wallet service because there is ‘some way to go’ before the technology catches on.
The operator launched the O2 Wallet last Thursday (26 April). The app and service is now available to download for free across iOS, Android and BlackBerry devices and via the mobile internet. Customers can send up to £500 daily via text and shop at more than 100 online retailers. They can digitise existing debit or credit cards for use in the O2 Wallet or top the account up using an O2 Money Visa prepaid card.
When the mobile payments service was unveiled last week, one criticism was that it lacked the NFC technology of the likes of Orange’s Quick Tap service. Speaking to Mobile, James Le Brocq, MD of O2 Money, said contactless payments would come to the service in time but the market had not quite caught up with the innovation. He said: ‘I think there’s a great online opportunity and that’s here and now. NFC is an investment. The ability to redeem coupons, use loyalty points or download information will be fantastic. I think there’s a way to go before NFC will be ubiquitous.’
The service will initially be marketed via social networks before a wider campaign is launched later in the year. Le Brocq said: ‘By the end of the year, I would like to think we would have millions of customers registered and interested. O2 is an ambitious organisation and this is one of the best things we will have launched this year.’
However, no decision has been made on whether the operator will charge for the service. When the O2 Wallet was showcased last week, the service took a 15p cut for each £1 that was transferred. Le Brocq confirmed the service would be free for O2 customers for at least the first six months but said it was too soon to say whether it would charge thereafter. He added: ‘It’s launching as a free service. When we were building the O2 Wallet things like Pingit [Barclays’ rival service] didn’t exist. We needed to have the facility to charge for this but this doesn’t mean to say we will.’
Le Brocq said the main source of income for the service would be through its e-commerce affiliates, rather than by charging customers. Among the retailers to have signed up to the scheme at launch are Debenhams, Comet, Sainsbury’s Direct and Tesco Direct.
The O2 Wallet’s barcode scanner can compare prices from a range of different retailers and allows the customer to purchase goods online. Le Brocq said the O2 Wallet would link up with O2’s Priority Moments reward scheme some time in the future.
Other operator’s money plans
Vodafone has teamed up with Visa to launch an NFC service. Customers with smartphones that feature Visa’s payWave technology can purchase items by waving their mobile device in front of a terminal. The service was announced in February and will come to the UK by April 2013.
Orange launched its Quick Tap service last year in partnership with Barclaycard. Customers with NFC-enabled phones, such as Sony’s Xperia S, can use the service at a range of retailers and restaurants including McDonalds, Pret A Manger and Subway.