Mobile Marketing and Commerce Strategies

Chinese operator China Mobile has decided to take the leap into the mobile wallet world, but it has chosen to rely on RFID instead of NFC for cost reasons and easier adoption.

According to Rethink Wireless, China Mobile will be using a combination of embedded RFID and a SIM card for mobile payments. The operator believes it will be cheaper than NFC and easier for cellcos and users to adopt, since users will just have to replace their SIM card to start making payments. It also believes the combination will provide better performance than NFC, thanks to a larger antenna and RFID applications base.

Yankee Group Principal Analyst Nick Holland comments

“China is somewhat unique as a market, with population and mobile subscribers of a magnitude that make adoption of proprietary technology more feasible than more fragmented markets due to sheer economies of scale. Further, the closed nature of Chinese society removes requirements for interoperability with other standards and technologies. While anywhere else this announcement may be considered a snub to the adoption of NFC, in China, this may simply be a choice to find a cheaper alternative.”