Who is going to use it?
Everyone and everywhere, or Apple will not release it. They are going to go for the biggest possible market for this device. It will be good enough for 80% of what most people use their laptops, with the none of the hassle. On trains and planes most people are in read only mode with their laptops, with maybe a little bit of email. People who don’t like computers at all will have a simple way to access the internet, with other uses. Students can have all of their books with them all of the time, and able to capture notes. It will push mobile gaming further along. For most it could for some replace the laptop, but focused as a book/magazine replacement, I don’t think it will compete with a laptop. For the people who don’t read books, it will have interactive magazines, papers, how-to guides, guidebook, and more as outlets will have wifi and push content to it.
The classic challenge was – “Is this device just good enough to read when you go to the john?”, but imagine a day when you have access to every magazine you ever bought, without the piles of them everywhere, including the john, marked with the articles you found interesting, with links to online website or cross references to other articles and books. More eco friendly too.
The laptop will become main computer on the move, with enough power now to do photo and video processing, with the iMac if you prefer with that great 27″ screen which a laptop can never compete with. It will give everyone else a simpler way of taking the stuff they need on the move.

It could be very close to the hitchhiker guide to the universe book for around £500-600.

If, Apple actually have this event on the 27th and it is about the tablet and not iPhone 4th gen, I think it will be most of the above and packaged as only Apple can, which will add the extra 20%, that will leave others wondering how they catch up. Of course if they don’t release at least this much then their stock will drop…

What is meant by mobile payments, are they needed in Europe, what form will they take and what is stopping them?

Mobile Payments, are not specifically a payments problem. The mobile is a channel just like the internet, ATM or PoS terminal. I cannot see the need or will from the banks or central infrastructures to support a new mobile payment type, and there should be no need as with SEPA Credit Transfers (SCT), SEPA Direct Debits (SDD), Card networks (with standardisation from the SEPA Cards Framework enabling new entrants; PayFair looks interesting) and in the UK Faster Payments. The payments element can be made with existing payments, maybe wrapped in a slightly more specific scheme for cross boarder operating, risk and interchange management. So then this is about a mobile channel, which could use the existing payment schemes

Europe is not Africa/Asia, obviously, and the challenges and capabilities available to customers are very different. So I am not sure it is helpful to directly look at the solutions in these regions and expect some direct translation. Even mapping them on to Europe’s un-banked does not take into account the mature levels of regulation and controls on payments in Europe which we should not loose and needs banks and governments to look at the socio-economic reasons these groups remain un-banked. These will not be solved by a bank product, device or piece of plastic.

During the evolution of Mobile Payments, it has been mixed with thinking about Contactless payments, to the point where they seem to flow into each other in discussions. These are two different mountains and the peak of mobile payments is not reachable from the NFC peak. Near Field Communications (NFC) devices, such as Inside Contactless micropass can be embedded in anything a phone, pen, card, or foil that be stuck to anything, like your watch or even mobile. This in effect replaces the card with limited security, without EMV. But this is not mobile payments, and due the risk will “never” enable payments over £100, and will probably stay in the sub £25 range. I see this as a P2B solution, as the person is interacting with a Point of Sale (PoS) terminal. It looks like phone application are able to transfer data to the NFC chip in the phone, which may enable a high level of security, but are people really going to exchange value by tapping their phones together?

Who is going to provide the mobile payment solution? The solution will have to have to have the support of the banks as only they have the systems to manage their customers accounts with the necessary risk, compliance and security demanded by their customers, governments and central banks. These burdens are increased each year and at the moment there is little likelihood in that changing so new entrants will in fact have to become banks, or PSPs. Much as the mobile operators and the hardware manufactures would want a piece of the mobile payment transaction pie, they are little more than data carriers unaware of the value of the packets of data. The mobile payment instruction has to be portable across carriers and hardware platforms, as these cannot be fixed between sender and receiver. End2end standardisation could occur between the mobile operators and hardware vendors, but so could peace in the middle east – I cannot see Apple bring its iPhone to the party with the other mobile hardware vendors.

Mobile Wallets, where the value is stored on the phone in a virtual account or pre-pay account I cannot see going unregulated due to the dangers of criminal exploitation when it goes beyond the gift card market. But this does leave the question are anonymous transfers of value are going to be possible in future? I would hope not, so the black markets have to work harder to launder their funds untraceably. Paying for airline tickets in cash, with no verifiable ID associated with the transaction, should just not be acceptable – Apple did this to stop people buying more than 2 iPhones.

The mobile payments solution could well be an application on an iPhone or internet browser on a mobile phone. As these smart phones, get smarter to the point of offering PoS level of capability and connectivity to the payment network. So is it enough to make a P2P payment, by entering your details into a application carried by other person, or would security concerns be a blocker? The feedback loop of execution and confirmation being received by both parties is going to be key, with a multiple part scheme with banks providing risk management.

This level of security is an authentication problem, of who each of the parties in the transaction are and how they can safely transfer the instructions to their respective accounts. This is an old problem solved today with the use of PKI security systems, distribution and indemnities, as provided by IdenTrust, and would be needed by both parties. The challenge is transferring that authentication message with the payment instruction and this is where mobile application to NFC could play a part. Identity is the real security battle ground, as when that can be assured and checked many other threats can be risk assessed more accurately, and transaction information intelligence applied in realtime for suspicious transfers or even purchases. If the same ID could be tied to airline ticket…

I think in Europe the core elements of a solution are in place, where mobile payments are seen as separate from card/NFC payments – channel technology, and schemes.
Banks could offer a mobile payment solution, but it will still probably require government/payment councils/EPC involvement to get to the Person 2 Person payments, irrevocable, immediate/scheduled transfer of value anywhere where, any value, any time, domestically or across borders, while maintaining regulatory compliance. But this involvement could be as little as standardising on a trust authentication method, that everyone else can be assured off, and huge as bring merchants and public/corporate/government to this marketplace – no the scale of EMV (Chip & PIN). I think this is possible on a pan-european basis but further – unless the US government realise the real value of global ID.

Roland Tritsch in his Innolocity Blog post on mobile-payments, ask some reasonable questions regarding a couple of key characteristics of cheques that Mobile Payments will have solve, given that cash, cards cheques “work” and in order to replace them people will want the same capabilities from their new payment methods.

What mobile products could replace the cheque, given:

1. Cheques can be given to people with no bank account
2. Cheques enable you the payer to make a payment to the payee knowing only their name – “anonymous” payment.

The “unbanked” are a key target for the new payment methods, but there is a degree of conflict with the increased level of financial crime controls being imposed by goverments. So cheque have changed, in the UK anyway, as they are are now all “crossed” meaning they should/can only be paid into an account with the same name as the payee, so “Cash” can no longer be used as a payee.This requirement of tracability of funds transfer means that anonymous funds transfer will be inceasingly difficult, if not impossible. Eventually everyone will need to have an “account” in some form, even though it may not be a traditional bank account, and could be a PrePaid card number or a mobile number?.

Also, these days if you know a persons name then today you can find out their email address or mobile telephone number, and increasingly people are very reluctant to change them, and hand them out as fequenctly as their name. It is possible to imagine it the not so distant future where name, email and number are interchangable, and knowing one will let you find the other items. The mobile number is almost unique, operationally most readily managed and useful for mobile payments. But the relationship of the mobile number to the persons banking details will need to be standardised and managed at a national, then international level, by their bank. or similarly trusted body.