M-commerce to reach US$25 billion by 2005
Revenues from mobile commerce will reach $25 billion by 2006, according to a new report from Frost & Sullivan.
Total m-commerce revenues will reach US$25 billion by 2006, according to a new report by marketing consulting company Frost & Sullivan.
The study claims that the foundations of m-commerce are currently being laid and that the market will take-off within the next few years.
The report expects that trade worth $25 billion will be generated through mobile payments in 2006, which equates to around 15 per cent of estimated online e-commerce consumer spending for the year.
Ben Donnelly, Research Analyst at Frost & Sullivan, said that it is more a question of how and when, rather than if, mobile payments will gain mass market acceptance.
"Analogies can be drawn with the introduction of credit cards 50 years ago, currently the principle alternative to cash.
“They were perceived as a niche product and unnecessary luxury for many years until global technology standards made them viable for the mass market," he said.
"Mobile payment increases the lifestyle efficiency of consumers, making use of "dead time" that could otherwise be wasted doing nothing. For example, users are able to make purchases walking down the street, pay bills while they wait for a train, or pay back a debt to a friend immediately after a meal," added Donnelly.
Despite concerns over safety, mobile payments actually offer a higher degree of security than credit cards, argued Donnelly, since both the phone and a PIN are required as authentication. "The fraud risk is miniscule compared with credit cards," Donnelly explained.
"A stolen mobile phone is far harder to crack than forging a signature on a credit card."