“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 user’s 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 25-34
• 9 million people= 3.6% American cell phone owning
public
• People concerned with info transmitting over cell
phones
• April 2007- April 2008 = 73% rise in people visiting
shopping/auction site from phone
Over 9 Million purchases made by cell phones
Current Information (cont.)
• In 2005- $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 Porter’s 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 past’s purchases the customers made.
Case questions
Which of Porter’s 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.