M-Commerce Unleashed

WIKI’s Definition: Mobile Commerce is any transaction, involving the transfer of ownership or rights to use goods and services, which is initiated and/or completed by using mobile access to computer-mediated networks with the help of an electronic device.
Layman’s terms: M-Commerce is an act of buying and selling goods, services or information without any location restrictions, by any mobile device which uses a wireless connection to establish communication between all the necessary parties to complete the transaction.

M-Commerce Transaction (Transaction from a Buyer’s point of view)
Transaction Actors
Buyer (User)
Seller (Content Provider)
Network (Internet / Mobile Service Provider)

Transaction from a Buyer’s point of view.
Transaction Legend
Data Communication layer: Internet / Service Provider Network / Any unique system to complete trading successfully.
Point of Sale (POS): Place / Instance at which the goods / service is traded (purchased successfully)
Proof of Purchase (M-Ticket): Received at POS, as acknowledge/receipt for the trading.
Point of Entry (POE): Place where the M-Ticket is redeemed to avail the service (time of delivery).

M-Commerce Technical Aspects
The idea line behind any m-commerce application is the ability to make commerce transaction through mobile. To be more specific, uniquely identifying & authentication the commerce transaction based on the user’s MSISDN. Technically the billing system which involves a seamless transaction back and forth between the mobile and the payment gateway is the key. Different ways to accomplish M-Commerce are
1> SMS channel: This is commerce between consumer and supplier over SMS. SMS channel is used as a medium for interaction to place order & for payment.
2> WAP channel: This is commerce between consumer and supplier over WAP medium. WAP channel is used as a medium for interaction; the mobile user interacts with supplier’s WAP site and place order and makes the payment.
3> Internet channel: This is the commerce between consumer and supplier over the Web. Mobile user interacts with supplier’s website over Internet using a PC, his mobile number is used as identifier for the transaction and it might need SMS or WAP channel to complete the transaction.
All three channels have their limitations as well as benefits:
Though SMS channel(PUSH marketing) has larger coverage area, same time it difficult to place order as the user have to remember keywords & item code for placing orders.
WAP channel (PULL marketing) need active GRPS connection on mobile, same time its more user friendly.
Internet channel cannot be used everywhere as user need active internet connection, same time it’s more user friendly and has better UX (User Experience).

Real-time Scenario
Just think how exciting it will be if you can place order for a cup of cappuccino using your mobile device on our drive back home and by the time we reach, hot cappuccino awaits at the door steps.
Mr. Swami decides the same and sends an SMS to 9898 with text “CAPCINO 1” to the coffee pub to which he has enrolled thereat. After few seconds he receives an acknowledgement SMS with text “Order for 1 cappuccino will be delivered in 15 mins and you are charged Rs. 50”. On his arrival to his residence, a delivery man offers Mr. Swami a hot cup of cappuccino to drink, taste, enjoy and refresh.

M-Commerce –The Next Big Step

As I was gazing through blogs & googling about mobiles, I was able to sense something really big, that awaits and surrounds this tiny little gadget. A million dollar question which provoked me to give this post was -why hundreds of billions of dollars were spent in, as licensing fees by all telecom majors across the globe for UMTS(Universal Mobile Telecommunication System) and other 3G licenses (now also the 4G band). I certainly believed and predicted that this war of supremacy among carriers for licensing is for a desperate cause, which in future yield them higher revenues compared to peanuts of investment that goes from them, for the accusation of 3G/4G licensing. This strange act from carriers puzzled and fascinated me, to do a depth first search on the web, where I finally landed on to a page, so called “MCommerce” - a new vertical and an emerging market that is slowly growing in strength and will rule the future.

As per contemporary books and by Wiki’s definition -Mobile Commerce (also known as M-Commerce, mCommerce or U-Commerce, owing to the ubiquitous nature of its services) is the ability to conduct commerce, using a mobile device e.g. a mobile phone ( or cell phone), a PDA, a smartphone on the move.

Perfect Tripod
Yes, the success of MCommerce lies on the Tripod –Carriers, Application Developers (here we stand) and the Device manufacturers. In order to exploit the m-commerce market potential, handset manufacturers such as Nokia, Ericsson, Motorola, and Qualcomm are working with carriers such as AT&T Wireless and Sprint to develop WAP(Wireless Application protocol)-enabled smart phones with newer VAS (Value Added Services) to reach customers. My hunch says that this is the perfect area where we (Mobile application developers – here we go) can dive deep, explore and get the best pearls from the vast ocean of mobile communications. As you dare to dive deep, I am sure there are numerous opportunities and newer applications we can end up inventing.

Deep Sea Exploration
When I started exploring, I realized it’s still a largely unexplored part of telecommunications space, but at the same time there are plenty of divers (competitors) who are already in the deep sea exploring and inventing newer applications and other VAS. There are quite a few areas which act as predominant channels/ mediums to perform mobile commerce, they are
• Bluetooth technology
• WAP –Based /Internet -Based
• SMS –Based
• Voice –Based
Many more to be listed, and if you look at the services that can be served by these means are much bigger in dimension, they could be
• Location specific content-offering: Personalized location specific content and services such as hotel reservations, movie listings and booking.
• Digital cash: With smart card integration which can be used to download digital cash and carry out purchases.
• Mobile Ticketing
• Bill Payment
• Shopping

Man Eaters
Yes, as synonymous to the threats from sharks and poisonous jelly fishes to deep sea diving, there are numerous challenges which pose a greater threat to mCommerce market; they can be classified on the basis of
• Lack of standards
• Lack of ubiquitous wireless network coverage
• Heterogeneous technology of wireless devices
• Security
• Privacy
• High prices of mobile services
• Slower access speed
• Current band width

Precious Pearl
Despite barriers and potential threats, this space will see a sustainable growth in the immediate future. Many leading companies are in the process of rolling out newer mobile applications which provides VAS to the end-users; this itself throws a great ray of hope on this market.
Moreover with invent of GPRS network’s packet switching technology, users are not charged on the duration of usage but on the amount of usage (data transferred); this attracts a wide range of new users.I am sure, with the PUSH and PULL marketing strategies prevailing currently in the trading industry, there is no doubt that MCommerce will be the best way to win new customers and greater revenue.