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One of the players must take on the risk before NFC can succeed, says founder of Japanese mobile wallet

Carl Atsushi Hirano, the driving force behind the introduction five years ago of Japan’s Osaïfu Keitai mobile wallet service, has set out his thinking on what was required to make the service a success and what it will take to successfully introduce NFC services in other countries.

Carl Atsushi Hirano

HIRANO: "Somebody must take on the risk"

In the foreword to a new report on the Japanese mobile wallet service Osaïfu Keitai, Carl Atsushi Hirano, president and CEO of consultants NetStrategy and the head of mobile wallet services at NTT Docomo during the launch of the operator’s Osaïfu Keitai service five years ago, has set out his thinking on what it will require to launch NFC services in other countries and why the technology has been a success in Japan:

The first reason is that I researched the dissatisfactions and inconveniences of daily life. I’m convinced that these ‘dissatisfactions’ and ‘inconveniences’ are the mother and father of every new industry. Why do I have to have so many loyalty cards or credit cards in my wallet?

Everything started with this idea. After a theft I would lose all of these cards, but if all of my cards are integrated on my mobile then all I need to do is make one phone call to my telephone operator to stop them. In order to create such a world, I created Osaïfu Keitai.

I am certain that there is a demand for such a market the world over, as much in European as in the United States.

“It is important to construct an ecosystem from which all participants of the value chain — mobile operators, providers of contactless card technology, companies managing the services of the real world, such as retailers, public transit companies or beverage dispensers — earn a profit,” Hirano adds.

“However, to create this ecosystem, we need to solve the hen or egg causality dilemma, as Andrei Hagi (a professor at Harvard Business School) explained in his Multisided Platform Theory, and one of the players has to take the risk to create and coordinate the ecosystem,” he adds.

“In Japan, NTT Docomo took on the role of the market coordinator taking on a high risk. I wish, from the bottom of my heart, that another company or brave person will give birth to this ecosystem, in Europe and in the United States. I am impatiently waiting for the day when I can buy a café au lait and a croissant in a Parisian café with my Japanese mobile.”

According to the report, Mobile Felica in Japan, there are now a total of 60 million consumers equipped with Mobile Felica-enabled handsets. Of these, 35 million are customers of NTT Docomo’s i-mode service, 10 million are signed up with KDDI and a further 10 million with Softbank Mobile.

Readers can download the executive summary of the report free of charge from the Jap’Presse website.

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