Orange sheds more light on UK joint ventures NFC plans at GSMA Mobile Money Live webinar today and it isn’t pretty

Orange sheds more light on UK joint ventures NFC plans at GSMA Mobile Money Live today and it isn’t pretty

Today over in the UK, the GSMA held its “Mobile Money Live NFC webinar.” Among the panelists was a representative from Orange who is a founding member of an NFC joint venture between four of the five large mobile network operators in the UK. We have stressed our concerns about these types of NFC joint ventures before, but today we received new information that shows that the UK may be closed for business if you happen to compete with the NFC joint venture in a cartel type anti-competition fashion.

The representative from Orange said that NFC payments and security would be dependent on the ONSM as well as the OEM NFC phone manufacturer. We are more than used to hearing the term MNO to represent Mobile Network Operator, and in recent times TSM has become a somewhat normal term to hear meaning Trusted Service Manager. But the hybrid ONSM appears to represent Operator Network Service Manager, which clearly defines a position where MNOs will be the only control mechanism for security with regards to NFC apps, SWP (single-wire protocol) secure connections and defining who can and can’t use the network for transactions. This, my friends, is a travesty for consumer rights and choice. It will ultimately reduce the amount of innovation that can occur and has serious consumer privacy concerns written all over it.

Orange says it will only allow SIM and UICC based NFC transactions on its network

The Orange representative also stated that NFC SIMs or UICC based transactions would be the only ones that would be allowed over Orange’s network, which would naturally preclude Google Wallet and similar competing products and services. The NFC SIM card gives your mobile network operator cart blanche in deciding whose NFC services you can and can’t use. This is a similar issue to net neutrality where ISPs wanted to control where you could and couldn’t go on the internet, and if let’s say a company like Google paid an ISP, they would allow consumers faster access to Google’s content and search results. Here in the US, this was regulated so that ISPs couldn’t get away with those kinds of businesses practices and yet both here in the States and over in the UK, the joint ventures are planning on accomplishing exactly that with mobile payments. That means your money, that means your privacy and it means they are deciding who you can and cannot do business with.

Our very own Editor in Chief, Seth, posed a question at the Orange representative asking whether Google Wallet would be allowed over the Orange network in 2012. After blushing a little, the representative gave a pre-rehearsed answer that said that Orange was working with lots of companies and that he refused to comment on Google Wallet. Whereas no answer isn’t an answer, if Orange had intended to be an open ecosystem it would have shouted it from the rooftops like Sprint did here in the States. Orange can talk about an open architecture until they are blue in the face but their actions give a very different picture that, along with their cohorts Vodafone, O2 and T-Mobile, appears to curtail consumers’ choices and does raise considerable privacy concerns. If an MNO is acting as a TSM, it would mean they would have access to your purchasing history. That’s a big privacy concern. Also, what happens if you have a billing dispute with your mobile network operator? If we do indeed move towards a cashless society and you get cut off, it would likely mean you would lose your ability to make any purchases at all, and at this time there are zero acts or bills that would protect you.

It is looking more clear every day that these MNO NFC joint ventures require governance and regulation. It is also becoming evident that consumers require laws and legislation that protect them. We feel that the British Monopolies Commission should take a look at what Orange, T-Mobile, O2 and Vodafone are up to, as it appears they are tactically cornering the NFC market at the expense of consumers. We feel the same process should happen with Isis in the US who appear to be building the exact same NFC joint venture model with the same net affects here in the States. UK, you still have 3 UK, who have not signed up for the NFC joint venture, and in the US we have Sprint championing consumers’ freedom to do business with whom they want. Vote with your NFC mobile wallets, and don’t lose your rights.