December 27, 2000, 9:33 AM — MOBILE E-COMMERCE was talked about a lot at this year's CeBit show in Hannover, Germany, which ended last week, but vendors and applications providers warned that some hurdles remain in developing the fledgling market.
Some here warned that the market will not take off until there are more mobile e-commerce applications, while others said that security concerns and convenience issues remain stumbling blocks.
The president of wireless heavyweight Ericsson, Kurt Hellstrom, for example, said that a critical mass of content and services is still lacking for phones that support WAP (Wireless Application Protocol).
Security and convenience were addressed by Jozsef Bugovics, executive vice president of business development at Brokat Infosystems, an e-commerce software vendor.
"About half of the [e-commerce] transactions that people enter into are never completed," Bugovics said, referring to all types of e-commerce rather than just mobile e-commerce. "Payment methods are either safe, but too complicated, or simple, but not secure enough," said Bugovics, who is spearheading eSign, a consortium seeking to standardize security for wireless Internet transactions.
With its high mobile-phone penetration, the focus in Europe has been on how to enable consumers to make payments via mobile phones, rather than with handheld wireless devices. But it is still not clear how users will make purchases using mobile phones. One option being looked at is embedding a user's payment information into a smart card, which can be inserted into a special slot on the phone's side. Another option is simply having the information directly embedded in the GSM (Global System for Mobile communications) phone's SIM (Subscriber Identity Module) card, which will function as an electronic wallet.
Motorola is riding both fences with its Timeport P7389, a WAP-enabled phone available in the second quarter that company officials billed at its launch as an "e-commerce phone." Officials said the phone can support a bank smart card, but it also will be launched later in versions with a built-in virtual wallet, designed for areas where smart cards are not widely used.
And much like the frantic deal-making in the United States, CeBit served as a launching ground for a number of partnerships between European carriers and phone manufacturers, including Nokia and Dutch carrier Koninklijke.