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5 Takeaways from the 2013 Mobile World Congress

Mobile & Apps

The Mobile World Congress literally has something for everybody. Even as a privileged spectator with time to walk the halls, meet with industry leaders and attend some thought-provoking conferences, I still left with the sensation that I certainly didn’t have time to meet everybody or even see all of the things I wanted to see.

Here are the five key themes that I came away with from the Congress this year:

1. PIN codes are about to become a thing of the past

5 Takeaways from the 2013 Mobile World Congress image CrucialTecEnter CrucialTec. What makes their biometric fingerprint scanning so original and interesting that smartphone manufacturers are going to incorporate this technology into smartphones very soon?  Apart from the obvious additional security you will get from scanning your fingerprint to lock and unlock your ‘phone, when you think that mobile payments are going to be the norm just around the corner, this additional security is going to be the key to making M-payments secure.

Where CrucialTec really comes into its own is that its software allows you to assign a different function to each of your ten fingers. You could therefore use one finger for unlocking the ‘phone, another to access certain online banking apps and yet another to be able to open your Dropbox or other files that you may not want people to be able to access, especially when you think we frequently give other people our phone so that they can see or read something.

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CrucialTec is also adamant that this technology doesn’t require an ounce more power from the battery of your smartphone.

Apparently the company’s system has already been licensed by an unnamed Chinese manufacturer, and is expected to be on a smartphone to be released this July.

My takeaway: Remembering that Apple bought fingerprint scanner company AuthenTec last year, the race is on for device manufacturers to replace PIN codes with fingerprint scanning.

2. 2013 will see a significant reduction of cash withdrawals at ATMs

5 Takeaways from the 2013 Mobile World Congress image mobile wallet

The mobile money industry is expected to grow from $13.8 billion in 2013 to $278.9 billion by 2018, according to a study released by global research group Markets and Markets.

Thanks to an agreement with organizers GSMA, a Near Field Communications (NFC) enabled Sony Xperia T smartphone preloaded with apps was the passport to a new experience of mobile payments across the city of Barcelona, for over 3500 MWC VIPs and media representatives

The four partners in the project, VISA, Gemalto, CaixaBank and Telefónica, provided apps that were preloaded onto the device, delivering users a contactless mobile payment experience throughout the city.

The “Telefonica Wallet” included a La Caixa Visa gift card and payment application with a €15 balance for spending in Barcelona, as well as a voucher with coupons that could be redeemed via NFC.

MasterCard also announced a new digital payment system called MasterPass that lets people use a variety of devices including smartphones, while storing customers’ information in an online “secure cloud”. Banks and shops will issue customers with MasterPass “digital wallets”, which would accept credit and debit card information, including cards other than MasterCard. Online shopping can be done by using MasterPass on the web without having to introduce bank information and a delivery address for each and every ecommerce transaction.

Visa announced its partnership with Samsung to take charge of the “secure element” in its next flagship phone. The phone is expected to be launched at an event in New York on March 14th. The system works like a safe inside the phone. Whoever controls access to the phone decides which credit cards, transit passes or other documents the phone can store. A bank that wants to let customers use their Samsung smartphones as virtual credit cards will have to go through Visa.

The NFC discussion centres on who has control over the “secure element”. The event’s organizers, GSMA, advocates putting the secure element not in the ‘phone itself, but in the SIM cards which are issued and controlled by the carriers who would like to be in control of the secure element. This isn’t surprising: the carriers are the dominant force behind GSMA itself.

While Visa, the carriers and Google (which also has its own payment initiative) fight over the “secure element”, PayPal also wants to make smartphones central to the way we shop. PayPal’s thinking bypasses NFC completely. You simply pull out your phone on the way to a store, open the PayPal app to make your order and pay for it in advance. When you arrive, the cashier already has your picture and your order and hands it over.

My takeaway: Whatever the complexities, consumers are going to see banks, carriers and card companies scrambling to have them start paying with their smartphones this year.

3. Focus on the next billion

5 Takeaways from the 2013 Mobile World Congress image billion smartphones

According to Ovum Research there will be 1.6 billion new mobile connections across the world in the next 4 years, with 61% of these coming from APAC with the region’s 4.4 billion connections by 2017 making it the greatest contributor to global connections.

Africa will be the fastest-growing region with mobile connections growing at a compound annual growth rate of 6.5% between 2012 and 2017, increasing from 683 million in 2012 to 935 million in 2017.

How can carriers get cheaper devices into the hands of low-ARPU users and maintain a profitable business strategy? The experience of operators in Vietnam, India, and Pakistan demonstrate how they can operate in markets where ARPU is below $3 per month.

Meanwhile, LTE-capable smartphones that cost around US$200 without subsidies are hitting the market.

Microsoft entered the smartphone market via an agreement with Nokia. It now wants to focus on the African smartphone market and earlier this month announced its new “4Africa” strategy. The “4Afrika” initiative is in partnership with Huawei, who already offer a range of lower cost handsets for emerging markets such as the Y200 and the G300. Huawei will launch the Huawei “4Afrika” Windows 8 phone in Angola, Egypt, Ivory Coast, Kenya, Morocco, Nigeria, and South Africa. Although its retail price is expected to be relatively expensive for most emerging markets at $150, these markets increasingly demand more advanced handsets.

Huawei also manufactures the Y210 which retails at $92 in India and features the Android 2.3 Gingerbread OS, support of dual SIM cards, a 3.5 inch screen and a 1GHz Qualcomm Cortex A5 processor.

VMK, an African smartphone manufacturer founded in 2009, targets the market with its Elikia smartphone designed in the Republic of the Congo and assembled in China. It currently retails for $170. It uses Android 2.3 OS, a 650MHz processor and has a 9 hour “in use” battery life. VMK has even developed its own “App Store” as Google does not accept credit facilities originating from the Congo.

The $20.00 Nokia 105 aimed at “the 2.7 billion people who don’t have a mobile phone” is not a smartphone but has a 1.4-inch display, FM radio, a splash-proof keyboard, basic games and a built-in flashlight. No browser, no camera, and no social networking—but targets markets where any kind of voice and text service is welcome. Nokia also says the battery can last a month on stand-by.

My takeaway: manufactures will continue to hype about their latest high end smartphone launches but their marketers are focused on putting low-cost smartphones into the hands of people in emerging markets.

4. The Apple shadow

5 Takeaways from the 2013 Mobile World Congress image Apple Shadow

Apple doesn’t take part in the MWC (neither does Google). It doesn’t need to since the majority of the nearly 80,000 attendees are armed with iPhones which is testament enough to its dominance of the high end smartphone market. Other device manufacturers still seem to think people want phablets. Few companies are able to differentiate their non-PC product line as well as Apple does with the original or mini iPad and the iPhone. The rest are bringing out such a wide range of devices that you end up looking at something that you don’t know if it was originally designed as a phone or a tablet.

My takeaway: there are far too many sizes, and the myriad of offerings of tablets, smartphones and phablets don’t add anything original and positive to the user experience. It may seem like a great idea to be able to make calls from your eight inch screen phablet but it isn’t practical unless you have hands about the size of King Kong’s. 

 5. The role of agencies

5 Takeaways from the 2013 Mobile World Congress image most Powerful Medium

Brands such as Coca-Cola, General Motors, Ford, KLM and Unilever were on stage at this year’s MWC, because the carriers need to find new revenue streams as their core business of selling phones and charging for services matures; meanwhile brands want to unleash the opportunity of reaching billions of consumers directly via their mobile devices.

The App Planet Hall brought together more than 12,000 application developers, and mPowered Brands provided a meeting point for the world’s largest consumer brands, to accelerate marketers’ knowledge of mobile as a marketing medium. There was an important turn out of specialist agencies like Airpush, BuzzCity and InMobi; Kantar had a big stand and there were some very interesting conferences going on set up by a few of the leaders of the major marketing communications groups.

My takeaway: agencies need to play a much larger role at this event in the future if they don’t want to be bypassed. Brands are already talking directly to app developers, gamification specialists and the carriers.  Either the agencies become visionary thought leaders on mobile marketing or carriers and brands will leave them out of the conversation.

If you were at the 2013 MWC, what other major takeaways do you have from this year’s show?

Comments on this Article: 2

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  1. Martin says:

    Interesting take on the 2013 Mobile World Congress. I still don’t understand why telcos and smartphone manufacturers do not try to eliminate credit cards, another intermediary, from the whole mobile payment process. This would help reduce processing costs and perhaps stimulate uptake by potential customers. Why should I use my smartphone to pay, if this means greater costs for me as a user? If the merchant has to pick-up the tab, either they will swallow the additional cost or jack-up prices. Ideally, a mobile payment standard could be developed by financial entities.

  2. Martin, thanks for your comments.

    Telcos are in the carrier (a utility) business not the banking business and to cut out the banks and credit card companies would add a huge increase to their short term collectables.

    The carrier business model needs banks and credit cards to ensure payment by users at the end of each month. I think that is unlikely that we will see a model where credit cards are cut out, except in a system where you top up the credit on your smartphone before making a purchase.

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