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The Buzz About Wireless POS Solutions

By David Talach

At the 2005 Electronic Transactions Association (ETA) Annual Meeting and Expo in March, speakers, attendees and exhibitors buzzed about wireless payment solutions.

But a lot of discussion on this topic has occurred over the past four years, too. Many merchant level salespeople (MLSs) with whom I've spoken have indicated that they're tired of hearing about how wireless solutions will open new markets for them; they already know this.

Instead, they simply want to hear that wireless solutions do indeed work and solve real business challenges, provide a clear value proposition and generate incremental revenue.

Many MLSs are frustrated with wireless solutions previously introduced to the market that have not fully delivered on manufacturers' promises and with proposed solutions that don't recognize the practical needs of merchants on the go. An old proverb says that the last thing a fish will actually notice is the water. In our industry, the most successful wireless device will be one that people don't even realize is wireless.

A wireless POS solution needs to look and feel like an existing wired POS solution. This will instill confidence, minimize training and leverage MLS and merchant investments in the existing help desk and documentation to reduce the leap of faith to wireless.

When selecting a consistent and dependable wireless product to sell, look for the following attributes:

  • Transmission over mainstream carrier networks such as Verizon Wireless, Sprint, AT&T/Cingular and T-Mobile.
    Particularly in light of Motient Communications Inc.'s recent retrenchment of more of its network, don't sell proprietary and limited solutions that will bring a series of surprises and disappointments to customers.
  • Carrier certification.
    The major carriers maintain certification processes to ensure that devices using their networks meet minimum standards. Just as handset manufacturers such as Nokia Corp., Siemens Communications and Motorola Inc. submit their devices to these tests, so should POS terminal suppliers.
    Radio frequency (RF) engineers tune devices to maximize carrier band sensitivity to ensure compliance. And MLSs (and their customers) should expect the same level of engineering and performance that they've come to expect in mobile phones.
  • Assurance that wireless products are part of an overall Internet protocol-based product strategy.
    The wireless solution of choice should optimize investment by leveraging what's already in place. Existing application re-use and portability will ensure continuation of familiar user experiences.
  • Large battery capacity.
    It's crucial that mobile wireless payment solutions have the staying power to conduct transactions through the end of the day.
    Compromising on battery capacity to save a few ounces or dollars won't buy much goodwill from merchants who find that they can only conduct 75% of their daily business electronically.
  • Antenna performance.
    While internal antennas may be aesthetically pleasing, RF engineers will attest that an external antenna always performs better. The external antenna allows an operator to use a wireless device farther away from the transmission base station.
    As with battery capacity, compromise may be fine for the everyday consumer pocketing a mobile phone, but merchants who want to conduct business everywhere their customers are, will value robust ability over style.

It's tempting to view wireless payment solutions through the same lens that consumers view mobile phones, but this would be a big mistake.

Mobile phones are now as much a status symbol and personality statement as they are a communications device. And consumers know that they can swap their mobile phones every year or two for minimal cost (usually subsidized by the carriers) in order to take advantage of smaller, lighter sizes and new features such as camera and video capabilities.

The payments industry, however, is mostly made up of late adopters when it comes to technology. Merchants, and the ISOs/MLSs who serve them, prefer not to adopt a technology solution until it's proven capable so they don't have to worry whether or not it will work when they need it.

Success in selling wireless lies in the ability to deliver mission-critical solutions that merchants will view as reliable and dependable. Merchants want simplicity; they think the less complex the device, the less chance of something going wrong with it.

The more familiar the look and feel of the solution, the more comfortable they'll be in putting it in the hands of their sales clerks. They want new features to be there when they need them, but most are not willing to pay up front for a function they're not likely to implement for a year or so. Earlier wireless networks such as Motient, Cellular Digital Packet Data (CDPD) and Mobitex have proven to be disappointing and unreliable.

But now major carriers have rolled out standardized "2.5G" and third-generation (3G) networks, which offer higher speed and capacity. More important, they have mass market penetration, so they won't disappear with a shift in the telecom market. In other words, they are "future proof." Future proof is a concept to sell to merchants who don't want to be treated like a science project. They don't want to worry about whether something will or will not work when their livelihood depends on it.

Provide merchants with a reliable signal and reception, batteries with staying power, and a familiar look and feel, and they'll have confidence in their wireless solution's dependability.

David Talach is VeriFone's Global Product Manager of Wireless and Portables. He plays a key role in analyzing wireless industry trends and defining, designing and delivering wireless products to meet merchants' current and emerging requirements. E-mail him at .

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