Download - "Potentials and Challenges for Mobile Commerce - a Nordic Perspective

Center for Wireless Innovation Norway

cwin.no

CWINorway

TAMoCo workshop, Merida, Sep 2009

Potentials and Challenges for Mobile Commerce - a Nordic Perspective

ProfessorUniversity of Oslo/UNIK

[email protected]

Josef NollSenior AdvisorMovation AS

[email protected]

mailto:[email protected]




Sep 2009, Josef NollMobile Innovations

Research and Education at Kjeller

Close relation to FFI, IFE, NILU,...

Prof. from Univ. of Trondheim and Oslo

2

The building where the Internet (Arpanet) came to Europe in June 1973

Source: Wikipedia

.... and the Internet

Mobile Payment - Sept 2009 - Josef Noll

“Innovation by Design”

"Movation is a very exciting initiative where some of the best companies in

Norway commit themselves to build the Norwegian national team in wireless

technology innovation”

– Paul Chaffey, Abelia

founded by:

3


Outline Admittance, service access and payment Mobile extensions Introduction of Near-Field Communications (NFC)

– Message: “Using the phone for payment and access”– Phone implementations

Roadmap– Single Wire Protocol (SWP), – Future SIM

“While waiting for the future SIM” – Alternative Solutions

4


Mobile Market• Mobile workforce: 40-70

% of a group in different locations

• 90 % of the employees away from HQ

• 2006:• 1020 million mobiles

• 209 million PCs

• 4 Billion people with mobile in 2009

• Q4/2006: > 30 % smartphones in Norway

• 20-30 % smartphones by 2009.Nordic European

0

17,5

35,0

52,5

70,0

2006 2008 2010

Smartphone penetration [%] in Europe and the Nordic

0

22,5

45,0

67,5

90,0

2006 2008 2010

Opera Desktop Adobe Flash J2ME (Opera Mini)

Handset functionality in market share [%] for the Nordic market

[“Mobile Phone Evolution”, Movation White paper, May 2007] 5

6

Norway seems to have a highly favourable payment mix, with lowest retail cash usage (McKinsey & Company 2005)

1

20

0 00 0

0 5 8

0

5 3 9

34

1313 17

13

1517

25

2 0

6 12

2

1

2

75

31

1 0 1 15

2 37

3 5 3 14

0

0 10

2

1 758 1 970 1 505 1 467 985 1085 1 403 1 237 1 068100%

Number of retail transactions per household, percent

SP IT GE NLBE UK FR SEPL

Cash

Check

Cards*

Direct Debit

Transfers

*Including E -Purse

1 702

PT

98 93 93 87 86 82 82 79 78 75 72 71 70

AT CH NO

1 515 991 1 184

source: Bent Bentsen, 2008

Josef Noll, Sep 2004 Enabling Communication 7

Service development on Mobile Phones

1G:

1970 1980 1990 2000 2010

3G:

2G:

B3G:

Mobile telephony

Mobile telephony, SMS, FAX, Data

Multimedia communication

Personalised broadband wireless services

Original: B3G study, Jan 2001


Phone with RFID & PKI

• Workshop March 2003: RFID and the mobile phone

• Three steps:• A: Single RFID chip in mobile

phone

• B: Dongle with RFID (to allow communication between RFID and SIM/phone) – prototype 09.2004

• C: SIM card with integrated RFID (prototype 10.2004)

l SIM card with integrated RFIDl Prototypes available from:

– Giesecke & Devrient: demonstrated on Siemens phones

– Gemplus: both on one chip, (terminated) NFC

Original: NFC and Payment, Sep 2004


Mobile phone replaces purse, October 2004

10

Customer adoption• More than 360.000 customers• Fastest growing distribution channel ever!

0

100 000

200 000

300 000

400 000

Q406 Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q408 Q109

DnB NOR and Postbanken SMS - Registered users per quarter

source: Ingjerd Blekeli Spiten, 2009

It happened - Q4.2007

11

E-Invoice and friend services

You have received an e-Invoice from Telenor NOK 300; due 01.06.2008. Ref.id.: 10.To accept: Send SMS Accept [ref.id] to 04800

From 04800 To 04800

Accept 10 E-Invoice from Telenor NOK 300 is handled and will be paid 01.06.2008 from you main account

From 04800


Pay Ben 100

To 04800 From 04800We confirm that Ingjerd has paid 100 to you by mobile. Best regards DnB NOR

12

Who is the SMS customer?

0

25000

50000

75000

100000

1 11 21 31 41 51 61 71 81

# of SMS by age - January 2009

- Age 9 – 96 years- 19 most active- Oldest customer 96 years



ViVOtech 2006:

Contactless replaces cash

Device Fragmentation(handsets, operating system, security and network technologies)

source: Svein Therkelsen, mBricks, 2008


NFC is ...

RFID at 13.56 MHz RF (modem) and protocolls

15

Passive operation:1) Phone=Reader has static magnetic field2) Tag acts as resonator, “takes energy” ~1/r^6

0 0,8 1,6 2,4 3,2 4 4,8 5,6 6,4 7,2 8 8,8 9,6

0,25

0,5

0,75

1

1/r^2

1/r^6

Power decrease of static and electromagnetic field


NFCIP-2 Interface and protocol (ISO/IEC 21481)

16

ECMA-340

Interface Standards

ISO/IEC 14443

PCD mode

(MIFARE, FeliCa)

ISO/IEC 15693

VCD mode

(facility access)

NFC device Proximity CardReader

Vicinity CardReader

NFC ECMA-340

YES340 okay


Mobile Services, incl. NFC• Focus in 2008 on mobile

web• Push content upcoming

• NFC needs next generation phones• S60, UIQ, ...• Common Application

development• Integrated

development

[“Mobile Phone Evolution”, Movation White paper, May 2007]

Expected customer usage [%] “have tried” of mobile services in the Nordic Market

0

15

30

45

60

2006 2008 2010

SMS authentication Mobile WebPush content NFC payment

17


NFC use cases Payment and access

– include Master-/Visacard in the phone– have small amount money electronically– admittance to work

Service Discovery– easy access to mobile services:

Web page, SMS, call, ...– local information and proximity services (get

a game) Ticketing

– Mobile tickets for plain, train, bus:Parents can order and distribute, ...

18Source: Nokia 6131 NFC Technical Product Description


Nokia 6131 Firmware

19Source: Nokia 6131 NFC Technical Product Description

ISO14443


From current SIM to Future SIM

20

New visionsfor mobile / UICC

Current Telenor Current Telenor

SIM (UICC) cardSIM (UICC) card(from 2001)(from 2001)

GlobalPlatform’s

Real Estate 3.rd

Party sec. domains

vision

SUN

2009?

(Java)

Plus ETSI SCP

3 new phys IFs:

12 Mb/s USB

NFC (SWP)

On-board

WEB server !

Multi-

Thread

New visionsfor mobile / UICC

Current Telenor Current Telenor

SIM (UICC) cardSIM (UICC) card(from 2001)(from 2001)

GlobalPlatform’s

Real Estate 3.rd

Party sec. domains

vision

SUN

2009?

(Java)

Plus ETSI SCP

3 new phys IFs:

12 Mb/s USB

NFC (SWP)

On-board

WEB server !

Multi-

Thread

Source: Judith Rossebø, Telenor

To comply with 3G networking requirements (USIM)

– Security features (algorithms and protocols), longer key lengths

– GSM uses EAP SIM: client authentication– UMTS uses EAP AKA: Mutual authentication

3rd party identities – ISIM application (IMS) – private user identity – one or more public user

identities– Long term secret


New UICC architecture

21

eHealtheHealth

UICC – elements

UICC UICC ID = ICCIDID = ICCID

12 Mb/s USB

Full speed IF

NFC (or other) IF

(1 connector)

GSM Allocated

(2G/3G) IFs

(5 connectors)

New UICC Architecture / SIM advances

SIM Application Toolkit SIM Application Toolkit !! CAT CAT

PKI / PKI / eIDeID

PaymentPayment

EMVEMV

MultimediaMultimedia

DRM ?DRM ?

TicketingTicketing

(DRM !)(DRM !)

ElectronicElectronic

Purse Purse

Common Common

StorageStorage

USIMUSIMID= IMSIID= IMSI

& MSISDN & MSISDN

SIMSIMID= IMSIID= IMSI

& MSISDN & MSISDN

PhonebookPhonebook

Source: Judith Rossebø, Telenor


One natural NFC player?• Telecom Operators✓ have established customer and content provider relation✓ current business (content provider access) gets less important ✓NFC is opportunity for new business– inhomogenous infrastructure at operators

• Bank, Mastercard, Visa,...✓ natural choice for payment solutions– micro-payment and small transactions not successful– integration of content providers is new area, mobile is Telecom

• SIM card provider: Gemalto, G&D✓ harmonised infrastructure

– unknown for the customer, no trust relationship

• Handset manufacturers– global market players

No obvious NFC player, need Innovation partnership22

23

Ecosystem: The collaborative business model

Source : Mobey Forum Ltd. + Bent Bentsen, 2008

– Telenor and DnB NOR establishes TSM Nordic AS in April 2008

Josef Noll, “Who owns the SIM?”, 5 June 2007

The secure element:

SIM card

Send service to phone

Send info to recipient

Smartcard interfacesISO/IEC 7816

NFCcommunication

unit

SIM

NFC2SIM

Identity and personalisation

providerAuthentication

and Accessprovider

Serviceaggregator

• SIM is secure element

• controlled environment• over-the-air update• open for applications

• SIM will be owned by user?

• managed by trusted third party

Send key and credentials


While waiting for Future SIM and SWP:Alternative Payment Solutions

25

source: Petter Taugbøl, Encap, 2008


Mobile BankID Replacing the CodeCard or One Time Password with

an authentication on your mobile

26

27

PayEx Mobile

Java Application download and linked to PayEx kontoMobile phone used as payment channelBoth for Internet and payment terminalsDeduction from PayEx accountSupports Person 2 Person transferSept. 2009: NFC payment

adopted from: John Olav Olsen, PayEx, 2008

Payment and Banking References

Airline booking Mobile payment

Mobile banking

Mobile payment

Mobile banking

source: Svein Therkelsen, mBricks, 2008

http://www.braathensitsolutions.com/

http://www.braathensitsolutions.com/

http://www.bbs-nordic.com/en/

http://www.bbs-nordic.com/en/

Sep 2009, Josef NollMobile Innovations 29

Conclusions “The last time we

were connected by a wire was at birth!” [Motorola]

All services from your mobile

Why not earlier– Business model– Standardisation

Success criteria– known (SMS)– simple


“The fun of being in Norway” - Thanks to Juan Carlos Lopez Calvet from Telenor, Mushfiq, Gyuri from UNIK....

Eurescom colleagues (B3G study, RFID study), Bent Bentsen, Ingjerd Blekeli Spiten (DnBNOR), TrådløsFramtid, enCap,.... and many other companies