Mobile payment is a growth area, but many smartphones still do not have the technology to work at point-of-sale with a shop laser scanner. Mobeam has patented technology to change this, using pre-existing hardware on smartphones to allow them to be used with the red laser scanners already used in a variety of shops and businesses. The company has already seen a significant coupon partnership with Procter & Gamble, and is in talks with several major manufacturers to pre-install Mobeam'stechnology on their handsets, bringing the smartphone as payment device into bricks-and-mortar transactions, something that brands and businesses greatly desire, according to CEO Christopher Sellers.
¤ What makes MoBeam different from other mobile payment firms?
We solve for the failure of mobile phones at point of sale. The technology is software based, and accesses hidden APIs on smartphones, using the light sources available, and we haven't yet found any device it doesn't work on. So it could be a message waiting LED on your BlackBerry, or an infra-red proximity sensor on an iPhone or Samsung Galaxy, that's the sensor that disables the handset when you put it to your face. We access that light source with our software, and translate barcodes into light. Since red laser scanners - which are found in most retail environments in the world - cannot read a barcode from a smartphone screen, we use the light source onboard the device to beam the barcode directly into the sensor on the red laser scanner.
¤ What is your business model?
Our business model is really based on working directly with the brands. And that comes down to advertising; to delivering a message and getting value for that. We make it possible for coupons to be electronic, saving a lot of money on paper coupons. We also make it possible to know when and where the coupon was used, and what it was used to buy. And it works for other kinds of virtual currency too - we can partner with brands to allow pre-paid gift cards to be used on smartphones.
¤ Who are your main competitors?
Because of our ability to use light, I don't really think we have any direct competitors. There are hundreds of apps out there that can display barcodes and such, but the reality is that the point-of-sale systems just aren't there. So we are, in some sense, an insurance policy for handset makers, since we can fulfil the user expectation that their smartphone will work at point-of-sale, regardless of the specific scanner being used. It is true that image scanners and NFC provide competition for our technology, but less than half of one percent of all scanners are now image scanners that can read a 2D image, and widespread NFC distribution is a long way away.
¤ What's the biggest challenge you currently face?
The big challenge now is the number of devices in the marketplace. The cycle time of customers and consumers buying new phones is about 15 months, and if you look at the sales of smartphones last year, Samsung shipped about 120m phones, and Apple about the same. In a few years we'll see a couple of hundred million devices in the marketplace, and that will mean a couple of hundred million devices that will have our technology, and that's just it - it's just scale.
¤ What is the hottest trend in digital media right now?
It's more of a realisation that consumers are going to use their smartphones in ways that people have perhaps underestimated. So many aspects of life are going to become mobile - whether it's coupons, banking, or buying things. And as a result of that, traditional brick-and-mortar retailers are trying to find new ways to get customers using their mobile devices into their shops. Because the customer might otherwise do the research, find the product, and just order it from home. Last holiday season has been probably the best example of this to date - highest use of mobile devices, highest use of mobile advertising, every mobile trend was at its highest ever. And this year, it's all about capitalising on that so we can support our traditional retail channels.
Mobeam claims to be in a position to offer retailers, manufacturers and consumers a mobile payment solution that works now. The company says its technology has the potential to turn any smartphone into a payment device for brick-and-mortar retail stores. In the future, the company may have to compete with rival mobile payment technologies, such as NFC and Square, but both of these require additional hardware, both on the phone and in store, making Mobeam's service an attractive proposition. It could also work as an effective failsafe for other mobile payment solutions. In the UK, half of smartphone owners already use their handsets to shop, according to a report by Forrester and PayPal. However, Mobeam will need to make strategic partnerships and capitalise on interest from smartphone manufacturers to stay competitive in a marketplace that is becoming increasingly crowded.
The company is currently moving in the right direction by seeking to sign deals with handset makers and payment processors, as well as offering its technology for free to app developers, helping to popularise Mobeam's payment method. However, to fully capitalise on its opportunity, the company will have to convince major manufacturers such as Apple, Samsung, Motorola and HTC to adopt its technology. Where Mobeam is really useful is at point-of-sale in retail environments, and integrating more forms of promotional or electronic currency will help to drive its growth. Finally, there is an extent to which Mobeam's growth is dependent on a culture of mobile commerce which, although growing steadily, is still in its early stages.