Charge It with your cell phone CIS 429 Sarah Hegger

Charge-it Main points Wireless operators, credit card companies, retailers involved Example: Soda machine South Korea, Japan, Europe currently using technology Use of credit cards: Japan- 5.6% U.S. 33% of consumer spending

Charge-it Main points Currently testing cell phone credit card: MasterCard and Nokia Special chip with users credit card information and a radio frequency transmitting circuit Tap phone on receiving device at check-out cost retailer $80 Can tap phone even while talking to someone

Current Information 9 million people bought something from cell phone Mostly men ages million people= 3.6% American cell phone owning public People concerned with info transmitting over cell phones April April 2008 = 73% rise in people visiting shopping/auction site from phone Over 9 Million purchases made by cell phones

Current Information (cont.) In $50 million spent on marketing via cell phone Could be $1.5 billion by 2010 Shopping by Phone, on the Move

Current Information (cont.) PrVenueMobile- lets people buy tickets 24/7 from their phones Usablenet- Sears launched purchase and pickup mobile commerce system – Consumers manage in-store pickup of merchandise from cell phone Buying Tickets with Your Cell Phone

Case questions Do you think this technology as a potential threat to traditional telephone companies? If so, what counterstrategies could traditional telephone companies adopt to prepare for this technology? – Yes, if possible somehow tie the profits to the cell phone company to traditional telephone companies make some money off it without putting them out of business. – make traditional telephone more appealing to people and possibly cheaper packages then what they already have

Case questions Using Porters Five Forces describe the barriers to entry and switching costs for this new technology. – Entry barrier- product or service feature that customers have come to expect from organizations in a particular industry and must be offered by an entering organization to compete and survive Cell phone company must offer customer an array of services that this new technology will provide. – Switching Costs- are costs that can make customers reluctant to switch to another product or service. Cell phone companies can monitor what customers buy after many times of visiting sites they can tailor products to what the customer likes if they shop else where, there will be a switching cost since the new shopping site does not have a profile of the pasts purchases the customers made.

Case questions Which of Porters three generic strategies is this new technology following? Focused strategy- target a niche market Targeting the growing market of cell phone users and purchasing products and services from the cell phone

Case questions Describe the value chain of using cell phones as a payment method. value chain increase the infrastructure of phone companies and improve technology development payment method can receive/store information from the consumers purchases and send that to the phone company. more people will engage in this type of payment method.

Case questions What types of regulatory issues might occur due to this type of technology? people will be skeptical with putting personal information out there not knowing what kind of security protection the company has. people will find a way to hack into cell phones.