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The Green Sheet Issue 010601-
Issue 010601-
Table of Contents

ACH Losing the War on Checks

Who is NACHA and why are They Saying Those Things About Checks?

Precidia Has Winning Game Plan With Ether232

Equifax, 7-Eleven Team Up

Looking for Your Portfolio

An Innovation That's Right in Your Back Pocket

It's 2001 - Do You Know Where Your Data Is?

The Gift that Keeps on Giving

The Pix

Mist Adds Two Members To Its Family

The Art of ISO War

Power to the People

Games People Play

Teaching Old Dogs New Tricks


Lead Story:

Impoverished Display - Size Matters

I have found the movement in the investment community from everything "e" in this post-crash realism to everything "wireless" extremely interesting. While the Internet movement continues to grow in most ways, with the U.S. leading the way, the wireless Web (and for that matter the wireless anything) is moving much more slowly in the U.S. than in other parts of the world. While this is the result of billions of dollars in existing wired infrastructure still being amortized, I think it is also because we may not yet understand the fundamental ways in which a wireless world will change our lives.

We have heard about the low- or no-cost ways in which data will be able to move from device to device, or even that we can have the Web at our fingertips, but we are not quite sure that we want our presence noted, via something called blue-tooth, by every retail store or vending machine on the street. Something about all of this unconscious wireless activity that seems more like a bad sushi-induced Asimov nightmare than an enhanced shopping experience.

On another front, we are painfully aware of how slow most of our Web connections are and anticipate that the very convenient cell phone system, which seems to be continuing to improve, will be crushed by all of this useless flow of less than perfect and limited Web data being displayed on those impoverished little displays on our PDAs and cell phones. These concerns certainly have merit, since the early wireless enterprise systems are being built on the WAP standard for existing cell phones, an awful, retrograde specification that, I hope, will go away in time.

But not only is the time to build a fast and widespread replacement wireless system years away, standards are still under consideration with no clear winner yet apparent. The choices are EDGE (Enhanced Data rates for Global Evolution); UMTS (Universal Mobile Telecommunications System), which is a European standard; or the industry simply could adopt current TDMA and GPRS systems and Wideband CDMA (W-CDMA).

However, before I leave you with the thought that, because of these technical- and consumer-related concerns, the future of wireless will in any way slow down wireless applications and business opportunities, let me just remind you about what you already know: When something seemingly wonderful is just around the corner, no matter how far it actually might be from commercial-grade reality, it is exactly the right time to hype and sell it. (Well, I said I was going to remind you about things that you already know.)

If you don't think that this is the case, let me give you some examples:

The 3GSM World Congress in February in Cannes, France, was about every possible iteration of third-generation (3G) mobile communications. Perhaps, more important, it was about announcing plans and products that will help get more speed out of current and interim mobile networks. (No one had told you that you were signing up for an interim network, had they?)

Announcements included an HP Jornado with mobile phone functions, and a 3G mobile phone (pro-type) based on a Microsoft operating system code-named "Stinger," which perhaps is a reference to what it will do to our pocket books when it is released. The Stinger operating system is counting on the need for mobile devices to display multimedia features. Stinger will join Windows CE and Mobile Explorer as PDA wireless and wired interface software. Among the reasons that Microsoft is watching this wireless opportunity so closely is that the major hardware players already have allied themselves with a software company, and for now Microsoft is on the outside looking in.

On yet another front, if you attended the recent Electronic Transactions Association trade show, you would have seen a number of companies demonstrating mobile devices targeted at this new and evolving mobile opportunity. While mobile may mean to you something like the early devices that Lipman (Nurit) was offering in the marketplace, these ideas are to those devices what jets are to biplanes. Based on various existing mobile devices, including the Blackberry RIM, Apriva, Palm and HandSpring, various attachments are adding communications with a card-swipe device and printer, via an infrared connection, permitting these off-the-shelf devices to "be" point-of-sale terminals anywhere, anytime.

This is, of course, the home-sales marketplace that older, bulkier devices only hoped to reach. And with the ideas of a company named VeriTop, this approach can even get cheaper and dumber rather than more expensive and smarter. VeriTop believes PDAs or larger screen phones will have far more graphic capabilities in the future than they do today, through a thin software layer they have developed for payments. This graphical interface, which has a more familiar feel than text-based systems, such as RIM, actually originate all transactions from the Web, making the PDA-like device essentially a dump terminal.

While these hybrid systems make retail credit-card acceptance more portable than ever before, they also begin to lay the groundwork for other previously non-existing opportunities. The ability to do real-time signature capture and real-time signed documents and checks becomes possible for the first time at retail. While conversion and image ideas have suffered from the ability to ride the existing networks and large GIF and odd-format sizes, these events actually are being recorded on the Web real-time, and they will not require upload because they already will exist on the host.

While we are talking about signature capture and what new opportunities something other than just storing images for subsequent (if ever) retrieval might achieve, another player in this evolving e-commerce space is a company called Digital Ink. Digital Ink has created something they call n- scribe technology using a custom-designed pen. This pen requires that the user clip the pen's cover to whatever it will be writing on - say, a check - and the pen will capture the movements of the pen and store that information in a JPEG or PDF file and then can transmit this information, via infrared ports or serial connection to retail POS devices, to any processor. Eventually, blue-tooth wireless transfer will become an option.

All any of us have to do is look around to see how technology is transforming the ways people pay for stuff. Consumers in Japan and Europe pay for taxi rides, car washes or jukebox selections through their cell phones. In Finland, a call on a cell phone can prompt a soda to come tumbling out of a vending machine. No coins change hands; the price is merely added to a monthly phone bill. In the U.S., there is virtual checking. Users register online at a site run by companies like Achex, a San Francisco venture, in a process that takes minutes, and it then sends money directly from their bank account to any online retailer that accepts the service., a site selling clothing for plus-size women, puts the Achex icon in its checkout site first, before Visa and MasterCard. In December, Kmart Corp.'s Web site began allowing its customers to pay by Achex's virtual checks.

So it should not be difficult to see why a Korean company called Zoop wants to license its global-interface software to anyone in the U.S., or why Coke has a planned test in Atlanta this summer for PDA and cell-based vending.

While not all of the current and evolving Web-based - and some would say mobile-based - payment applications are going to succeed, as is the case with PayPal competitors Exchange Path and PayPlace, both of which have recently shut down their customer-service operations, some new ones will succeed, and the game still can be won by anyone.

But before I leave this subject, I also want to comment on some actions in the marketplace that may yet be real showstoppers. On March 14, NCR filed a patent-infringement action against Palm, Inc. and Handspring, Inc.,1 demanding a jury trial. In fact, before the April 4 Infrared Device Association (IRDA) press release in San Francisco, a prominent Visa executive was deposed by NCR attorneys trying to ascertain the nature of the Palm presentation of wireless PDA mobile commerce as participated in by Visa at the Consumer Electronics Show, in which Sharper Image demonstrated a Palm device conducting wireless payments using a Visa payment protocol.

While this suit may yet be settled or even determined in Palm and Handspring's favor, it did cause Palm to pull out of its planned presentation at the IRDA press conference and is likely to make both Palm and Handspring less willing to co-develop new mobile standards for some time.

No one ever said payments in the 21st century were going to be dull.

Good Selling!SM

Paul Green

1 U.S. District Court for the District of Delaware, patent infringement of numbers 4,634,845 and 4,689,478, regarding a system including a portable personal terminal that may be used for handling a wide variety of financial, shopping and other transactions, granted on December 24, 1984. This system includes, but is not limited to, a handheld device that will fit in the palm of the hand, with numeric and accounting capabilities, storage of to-do lists and notes, and is iR enabled to communicate with other computing devices. Device is designed to take the place of carrying multiple credit and debit cards and to handle checks and bill-pay activities.

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