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Verizon M-Payment Service Receives Kudos

The Strategy Analytics Wireless Media Strategies team says that they applaud the decision by Verizon Wireless to expand the utility of mobile phones with the announcement of an m-payment service enabled as a BREW application from technology partner Obopay.

Mobile payments and mobile commerce applications have been in use for several years, with pioneering approaches from Japan and South Korea enabling cashless transactions for train tickets, taxis, soda machines, parking meters and even restaurant bills. In contrast, carriers in the North American market have been slow to embrace these e-commerce related opportunities.

Phil Taylor, Director of the Wireless Media Strategies Service, commented, "In our December 2006 report, we predicted significant activity in the form of payment and ticketing trials towards the end of 2007 and maintain our projected outlook of $36 billion in spending via contactless payment interfaces on mobile phones by 2011. Today's announcement confirms our belief that significant momentum will develop as other U.S. and international operators jump on the m-payment bandwagon."

David Kerr, Vice President of the Global Wireless Practice, added, "Verizon Wireless is a trusted brand known for reliability, quality and customer service. Expanding the domain of influence for mobiles beyond voice, SMS and multimedia content is a natural step given their ubiquitous presence in the U.S. market."

Boasting industry-leading churn levels and a strong stable of innovative offerings from enterprise solutions from Vcast TV to Vcast Music, Verizon Wireless is well-positioned to capture the e-wallet, as well as the minds of the digital youth and early career segments in the U.S. market.

SprintNextel, which has forged a more positive approach to mobile advertising and alternative network technologies (e.g. WiMax), is sure to follow suit, while GSM leader, AT&T, has a massive national advertising budget and trusted audience who may be receptive to m-payments, according to the Strategy Analytics market assessment.

Clearly, making progress in mobile value added service (VAS) market development in the U.S. has been a slow and long drawn-out journey. Therefore, I'm also very pleased to report anything that indicates that the mobile applications bar of expectations is finally being raised to a level that is more in sync with the global market leaders.

For too long the American market has been on the trailing-edge of mobile service innovation, and so I'm confident that all informed industry analysts share the enthusiasm of Strategy Analytics regarding this much anticipated event.

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