The utility for m-transactions will have to manage identity and provide relevant hooks for the movement of sensitive data amongst providers in the trusted ecosystem in real time and on a per-transaction basis. Effectively, one of the outcomes of such a utility will be the definition of a fair and sustainable business model, and separately, the basis for building a solution that can provide an appropriate level of customer support.
Given the lack of a true cross-industry utility, and given the current environment of OEM-led fragmentation that is largely driving usability to suit its own interests, it is fairly obvious why we are struggling with both adoption and scale. The intelligentsia continues to be focused on relatively minor technology issues but there is no meaningful debate on how best we can collectively build this utility, only after which the next important step of building usability can commence.
Defining and eventually building this utility will not be a trivial undertaking. It is unlikely that such an undertaking – which will need so many different industries and regulators to come together – has been attempted before.
As much as the utility needs cross-industry and regulatory cooperation, the usability will need a competitive marketplace. Solutions that offer true and sustainable value to the end-user will prevail, and those that do not will fade away.
Collaboration across industry sectors possibly alongside like-minded regulators is best-suited for evolving the utility, its definition, or even better, a comprehensive specification with joint ownership that will ensure scale. Innovation and industry are best-suited to figure out usability – the solutions and their corresponding business models – that will drive adoption.
In some markets, individual providers may drive both utility and usability in a fragmented manner for its captive consumer base; and in other markets, the state may mandate the utility as well as usability solutions for its entire citizenry.
The happy middle path that provides the right amount of innovation, choice, and protection to consumers, supported by a sustainable business model across the ecosystem of providers, will be left for each market to chart for itself based on its own socioeconomic considerations. The key will be to understand this distinction between utility and usability – its symbiotic relationship where one supports the other, and yet needs separate definition and sustenance.
Regulators will need to be involved across the spectrum, providing much-needed oversight and enforcing compliance. Just like everything else, the key here will also be to ensure that they have the light touch that encourages innovators as well as the strong arm that repels violators.
Whether numerous existing agencies come together as a single cohesive regulatory body, or a brand new regulatory regime evolves, the guiding principle for the-mother-of-all-regulators will be to define and deploy a cross-industry utility that will ensure scale, upon which a highly innovative usability environment can then help drive adoption, collectively addressing all the relevant technology, business and compliance issues related to seamless and secure personalized transactions.
Check out Mehul Desai’s August of Money.