PayPal (Still) Looking To Mobile, But In The Wrong Places at MobHappy


MocoNews points out that PayPal is advertising open positions in “PayPal Mobile, signaling its intent to get into the mobile payments space. The listings describe PayPal Mobile as “a dynamic, young ’start-up’ business unit within PayPal dedicated to bringing value-added mobile payment services to consumers and merchants.” Of course, this is the same unit they pointed out in November 2004, and PayPal’s WAP service is still hanging on.

So many mobile payment companies described themselves as “like PayPal for mobile”, and it was always assumed that eventually PayPal would come in and own the space. The thing is though, most mobile payment systems are still a product in search of a market. Who needs PayPal-style mobile payments, really? The idea of using your phone to PayPal a merchant for purchases really isn’t that compelling when you’ve got credit and debit cards and good old cash, and reverse billing to a mobile phone bill works pretty well for mobile content.

Some of the contactless IC payment systems, like the ones used in Asia, are pretty interesting — but the payment stuff there is really just a sideline to all the other applications enabled by the robust and powerful platform carriers there are using. There’s a reason why the history of the mobile industry is littered with failed mobile payment companies. It’s got nothing to do with technology, marketing or implementation (though that often leaves something to be desired), it’s because there’s really little value in it for people in mature markets. There are plenty of existing payment mechanisms that satisfy people’s needs; mobile payments don’t promise to simplify things, or offer much benefit over them.

In emerging markets, however, there’s a huge opportunity. People are already using airtime as currency in some places, and Globe’s G-Cash system in the Phillippines is probably the best example of a mobile micropayment system. The opportunity for this type of m-banking, whether it’s “official” and run by a bank, or a more de facto or improvised system is huge. Several companies are already working in these areas, and they’ll find much more success than PayPal, or anybody else, pushing mobile payments in Europe and North America.