Jan 23, 2011
The application acts as a gift card and is required to be attached to either a pre-paid Starbucks gift card or a credit card. When prompted, the user simply clicks a payment prompt in the application and presents the rendered bar code for scanning. A very simple and smart solution.
So why all of the fuss? Because the US has been lagging behind in the adoption of mobile payments and micro-payments. Both Asia and Northern Europe have been making use of this technology since the mid-2000’s for the purchase of municipal services (buses, trains, parking), books, magazines, cigarettes and fast-food. Imagine swiping your mobile phone over the parking meter while on an errand or using your phone as a replacement for your MetroCard?
Beyond the frivolity of the Starbucks applications (which is actually quite handy), this is an excellent case study for the American public to begin a relationship with mobile payments. The audience is right-people who tend to be oriented towards new and somewhat trendy things-and the pace of a coffee shop is just right to work the kinks out of scanning and the somewhat pavlovian response of standing a retail register with your wallet out. The sales of smart phones are projected to overtake feature phones this year. All of these devices can act as envoys for those documents that we never seem to have convenient: club cards, membership programs, spare keys. The devices that we are never without are the ideal housing for these pieces of our lives.
The adoption of mobile devices as a currency will likely be slow. There is little need for the replacement of our current system, but rather as a supplement to help us avoid some of the less convenient aspects of our monetary system. For all of those small-payments that require coins that we seldom have enough of and the situations that need a fast transaction, your phone will be the E-ZPass of your pedestrian life.
There are pitfalls to be aware of: viruses, security, loss of your devices that has so much personal and financial information, but like the widespread use of credit cards, these will all become a manageable hurdle to overcome for ease-of-use.