Does The Mobile Phone Wallet Solve A Real Problem?
By Mike Masnick, Wed Apr 13 02:00:00 GMT 2005

After years of hearing about plans to replace wallets with mobile phones, it turns out many people don't seem to have much of a problem with their existing wallets.

For years, there have been story after story after story saying that you would someday get to leave your wallet at home, and your mobile phone would replace it with a combination of SMS-based payments or RFID-style quick payments. Despite a variety of efforts underway to make this a reality, none of these mobile wallet solutions have really taken off in a meaningful way. Many believe that it's simply a matter of time. Most of these solutions require widespread infrastructure changes, which take time (and money!) and also people need to grow more comfortable with using mobile payments, rather than credit cards or cash.

However, another theory is that people really don't see much of a benefit. A new study looking at what features people do want on their phones puts wallet replacement pretty far down the list of desired features. That raises the question of whether or not people really have that much of a problem with their existing wallets. Are carrying around wallets that big of a pain that people are screaming for a replacement?

Some people certainly claim that it's so. Specifically when it comes to lugging around coins, there's an argument that doing away with all that heavy metal might make life easier on many people. However, it still doesn't seem like the type of thing that people are up in arms over, just dying to get rid of their existing wallets. In fact, part of the problem is probably that people believe they'll never be able to ditch their wallets completely -- because there will always be some merchants who won't accept payments from a mobile phone -- and so all the mobile wallet does is add more complexity.

This could change over time, of course, especially as a younger generation grows up used to using their mobile phones in a variety of ways. On top of that, as these mobile payment solutions get better, it's possible that they'll add certain benefits that aren't really possible with cash -- such as faster payments or even better money management -- that will convince many people it's worth switching over. However, for those companies trying to offer mobile payment solutions, any initial marketing effort probably needs to focus on the reasons why mobile payments really are better than the good old fashioned leather wallet.