Why the market won’t care about mobile payments until Apple does it
I promise this is not just my “sour grapes” in reaction to not making it to South By Southwest this year. Ok maybe a little bit.
Listening to the PR engines wind up and prepare for takeoff as the annual South by Southwest festival gets underway, I started thinking about some of new applications that I have seen launch at the conference and have a fantastic first showing only to peter out in the weeks and years after the festival. A recent question and subsequent post by my good friend Mitch Wagner got me thinking about mobile payments and where we are going to see the tipping from small trials (like this one being planned for, where else, Austin) to full adoption by the general public.
Next year we will probably see a google wallet or some other payment solutions at SXSW, and that’s great. But what is it going to take for mobile payments to gain critical mass? I don’t think it is merely that having mature technology is enough; the reality is that technology has been mature enough to support mobile payments for some time.
I am going to be honest, I was not a believer in mobile payments. Lots of people pitched it to me, all the way back to the mastercard “tap and pay” scheme from a few years ago, and my opinion was always that it seemed to gimmicky, that really the level of effort involved in tapping my mastercard on a payment device seems only marginally less effort than swiping the card, or handing it to a cashier and letting them deal with it.
That was until I got my first Octopus card here in Hong Kong. 
A few years ago my job transferred me overseas, and I got my first taste of the Octopus Card when figuring out the Hong Kong transit system. But soon after I started seeing the Octopus logo everywhere. In the grocery store. In Starbucks. Everywhere. Even some of the Taxis are starting to take it. The first time I used it to pay for something non-transit related was when I ducked into a Mannings one morning looking for some allergy pills. As I was waiting in a very long line, a cashier from the express lane, with no line, waved me over. ”is that all you are buying?” she asked. ”yep” I said. ”Well, I can ring you up right here”. So she scanned my item and as I pulled out my wallet to pay for it, she blurted out “oh, sorry, Octopus only”. So out came the Octopus Card and BAM, payment accepted and I was on my way.
It was like a drug, it was so easy. No wallet, no receipt, no need to sign a piece of paper before I was ready to walk out of the store. (for those unfamiliar, you can register the Octopus card online for auto-refill and to review transactions) One hit and I was hooked. It was the first time that I realized that mobile payments, if done correctly, were the future of commerce for most of the transactions that we as consumers make on a daily basis. There are those of you out there reading this and saying, but yes, the largest transaction amount you could spend on an Octopus is around seventy five US Dollars. That is true. But I have to ask, how many times are you in a rushed situation where you need to spend more than that? I think we need to look at credit transactions and divide them up into large and small purchases. For large purchases, that is, more than one hundred US dollars, I could care less that I have to pull out my wallet. But for a coffee on the way to work, or a vending machine, or a parking garage, or countless other small transactions that would otherwise be paid for in cash, that friends, is where I think mobile payment is going to shine.
So what was it that made Octopus succeed where so many others have failed. I think it’s the ubiquity of the card itself. Try to find a Hong Kong resident that does not possess an Octopus card. With that kind of market penetration all a store needs is a reader and they are ready to take money from just about every person in town.
But that’s enough of my swooning over the Octopus. The point I was making was that success in contactless payment is going to come down to an easy to use system that everyone already has. Which is why I would be willing to bet that Apple is working on their own mobile payment system in the background to be built into the next (or maybe existing) iPhones. There are thirty million people in the USA with iPhones. That means that nearly ten percent of the population of America owns an iPhone. That’s a great market to tap for a payment solution.
There are no doubt going to be people that read this and tell me that I am crazy for making such a prediction. That Android or HTC or some other brand has some technology that will run circles around the iPhone. What I say in response it, it is not about the technology. It is about making an easy to use solution and getting that into the hands of as many people as possible as fast as possible. Apple has, just in the USA, thirty million potential iPayments customers. That’s huge.
On becoming a manager
I’ve found that there is a clear distinction between the mindset of a manager and the mindset of another group that, for lack of a better term, I call the “doers”. The difference in mindset is most apparent when things go wrong. On the one hand, you have the doers. When problems arise, this group is the first to grab their laptops, soldering irons, and toolboxes, and jump right in to sort out the issues. The managers, on the other hand, must take a different approach. Read more 
The Power of Different
I am a technologist by training, having studied computer science at the University of Delaware in undergrad, and by design I am naturally drawn to technology of all denominations. It should come as no surprise that some of my favorite leisure
time reading materials are technology oriented.
Yet some of my best inspiration has come from outside of the technology sphere, from immersing myself in stimuli that are outside of those things that I would normally be drawn to, and this is a theme reinforced by several of the mentors in my life. Time and again I find that solving complex problems requires experience that is more broad than it is deep, and I thankful that the past few years have helped me broaden my knowledge far outside of my previous education and career experience. Read more
Thunderbird
Thunderbird has been on my mind a lot lately, mostly because I have just taken a new position as my first expatriate assignment, and I continue to run into Thunderbirds overseas at a rate that is pretty amazing.
I started to write a post about my upcoming move to China (coming soon), but I soon realized I needed to give some background first, specifically how I got where I am right now.
I’m a technologist by training, and along the way I had picked up enough business knowledge to advance reasonably far through my career. A great deal of this knowledge was picked up from my mentors, members of my “personal board of directors” and my good friend, Google. As I became less of a hands-on technical staff member and more of a manager, I felt increasing pressure to defend my decisions with sound managerial decision making. Read more
South By Southwest 2011 – Time to Vote
It’s that time again: Time to vote for the panels that will be featured at South By Southwest 2011. 
This year, I have proposed a panel covering the topic of enterprise collaboration tools. A complex topic, to be sure, but the focus of my panel discussion will center on the types of tools that can be deployed in the enterprise today, and in the course of our one hour panel, I will make the case that the best choice for enterprise collaboration tools is often the simplest.
Our Panel: Can We Fix the Workplace in 140 Characters?
Keep it Simple
Who are you?
I was recently speaking a friend, helping him to position himself for a job hunt following a layoff at his firm (the second time I’ve done this in the past month, actually). One of the first questions that I asked is, “who are you?”. I asked him to give me a 30 second elevator speech about who he was, to sell himself to me.
It is amazing how many people that I talk to have a hard time with what, at first glance, seems like a simple task. Later on, I was thinking about what I would say if someone asked me for my elevator speech. So I tried it. Out loud. While home alone. After fumbling for about 2 minutes, I realized I needed to work on my own elevator speech. Read more
Personal Board of Directors
I’ve worked for a lot of startups during my career, and one of the greatest benefits that we received when raising venture capital (aside from the money) was often a few new faces on our board of directors. The experience brought by our new board members was often invaluable in advising us with regard to strategic direction and even tactical decisions. It is amazing, actually, how bad your decisions can be when you lack perspective. Having a board of directors is an important component of almost every successful company, and I’ve had great success in transitioning the concepts behind a board of directors into my personal life.
One of my most valuable resources has been what I term as my Personal Board of Directors. Call it what you will, it is always beneficial to surround yourself with smart people. Read more
Post Graduate Depression
I’m sure that I am not the first one to use this term. Or the first to feel this way. But it’s been nearly a year since the conferment of my Masters degree and ever since then, I’ve been feeling a little out of sorts.
I’ve decided to call this my “post graduate depression”
Here’s the issue: for almost 2 years, I was surrounded by really smart people. Really smart people that I enjoyed being around. We interacted nearly every day, and worked on projects together that pushed the limits of our cognitive abilities, our communication skills, and our patience. Read more
Up in The Air
We’ve just taken off from San Francisco international airport, and we hit that little patch of clear air at about four thousand feet, not jostling, but just enough drop in altitude to make your stomach rise just a bit. A cheap thrill, a strange comfort brought on by a familiar feeling.
I think back to my former life, the one where I traveled more than half of the time, flying hundreds of thousands of miles every year. Some days I miss it, the excitement of being in a strange place, meeting new people, closing a big deal or sorting out some vendor issue that other people in the company didn’t have the stomach to deal with.
A few years ago I cut my traveling down significantly. Having attained the highest position possible at my previous firm, I set my sights on a dream I had deferred for far too long: going back to school to pursue my MBA.
My father, a source of many valuable insights, advised me that I should consider leaving my current job and getting a paper route for the 2 years that I would be in school. “I don’t mean literally a paper route, I just mean, with the hours that you put in at your firm, and amount of travel that you’re doing these days, it would do a disservice to both your job and your studies to attempt both at once” I knew he was right, but it was still hard to make such a change consciously. I loved my job, I really did. But I knew there was little future in it, and so in the spring of 2008 I left my former company, signed up for more loans than I could fathom at the time, and registered for classes at Thunderbird.
Things have not necessarily turned out how I planned. I managed to quit my job just prior to the onset of the global economic downturn. Needless to say, recruiters were not exactly beating a path to business schools in late 2009 to recruit recent grads.
Looking back, I would do it all again in heartbeat. Really. Thunderbird was an amazing experience. Life since then has been an amazing experience. Even the job that I looked at as my “paper route” has taken my life in new and interesting directions, teaching me valuable lessons about business and entrepreneurship along the way.
I think the thrill I get from travel is based in potential. Step off a plane in a new city and the world is your oyster; it’s all about potential energy. Graduating from Thunderbird felt similar; full of potential, not sure where it’s going to go, but thrilled to be traveling.
We’re not different…We’re just artists
For the month of March, I’ve been contributing to my “750 Words” page, a private brain dump where I put 750 words per day. It’s fantastic, especially when done at the end of the day. You can even share stats from your writing. As I suspected would happen, there have been times where my brain dump resulted in a blog post. Like now…
Generation Y is a very different generation than our predecessors. I know every generation says that, and in fact, it’s mostly true. But the acceleration of the gap between generations is absolutely startling. It’s like something of a “Moores Law” of generation gap, that is to say, with every generation, the gap between it and the previous generation seems to widen by a growing margin. Good golly, what is generation Z going to look like? But seriously, I’ve been thinking about generation Y a lot recently, and I’ve come to some conclusions. You saw a few in my video post yesterday, and here’s another.
The generation Y mind is a young mind. Not to say that we are immature, but young in a different way, in outlook and in how we interpret the world. In my video post yesterday I mentioned that one of the hallmarks of Generation Y is that we are not afraid to fail. One of the reasons that artists are successful is that they are not afraid to fail either. Bad photo? Take another. Bad sculpture? There’s always more clay. Pablo Picasso said that “all children are born artists, the problem is to remain an artist as we grow up”; Generation Y, has, I think, stayed artists far longer than previous generations.
My mother worked for the World Book encyclopedia company. You remember them, right? They authored huge volumes of information and placed that information into lovely red-leather bound books with gold leaf edges. Working for World Book meant that my mom brought home an endless supply of encyclopedia volumes for me to read. Which was fine by me, geek that I was. I could not get enough of them, I read everything that I could get my hands on. I realize now that it is only through the acquisition of knowledge that we learn to make rational decisions. I learned to learn by reading books. Lots of books. Today, people are doing the same thing by via the internet.
I’ve always loved computers as well. I had my first computer by about age 5 and as you can imagine my ability to write code in Basic on my TRS-80 was a real hit with the ladies.
I remember telling my mom that someday, all of the information in those heavy encyclopedias would be available right on the screen of a computer. She thought I was absolutely bananas.
Look who is laughing now mom!
Just kidding.
But seriously, the amount of information that is available to everyone, at almost any time, is startling. Think about that. I mean, I remember hearing about “Mosaic” from the guys in the computer lab, and after I had a play with it, I brought a copy back to my dorm room on 13 floppy disks. I was hooked. Really. I cracked open notepad and starting writing web pages a few days later. There we were, witnessing the birth of the internet; sadly Al Gore never really did get his figure back. And now here we are, less than 2 decades later, and look at how far we have come. It’s almost easier to talk about the things that are not on the internet than it is to do it the other way around. It’s funny to say, but really, I find myself doing that all the time.
Generation Y has access to all of this, basically the world of knowledge, right there in front of them. They have grown up in a world where they have had to search for information, fail, and try again until they found it. This action changes people. I recently attended a speech where the presenter put forward his theory that people, it seemed, were changing the internet to mirror their behaviors. That “these kids today” invented twitter because 140 characters is the limit of their attention spans. I’m pretty sure he’s wrong, and in fact, I think the exact opposite is true. It is the internet that has enabled generation Y to evolve into what they are, a group of people that are hard wired to try, fail, and try again without getting bogged down. You know, like artists.
