Money transfer will be top mobile application in 2012

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Money transfer has been identified as the top mobile application for 2012 as it is low cost, fast and convenient compared to traditional transfer services.

According to IT research and advisory firm Gartner's top 10 mobile applications for 2012, money transfer will take the lead while mobile music was last on the list as only ringtones and ring backtones have taken off. Gartner listed applications based on their impact on consumers and industry players, considering revenue, loyalty, business model, consumer value and estimated market penetration.

"Consumer mobile applications and services are no longer the prerogative of mobile carriers," said Sandy Shen, research director at Gartner. "The increasing consumer interest in smartphones, the participation of internet players in the mobile space, and the emergence of application stores and cross-industry services are reducing the dominance of mobile carriers. Each player will influence how the application is delivered and experienced by consumers, who ultimately vote with their attention and spending power."

"The ultimate competition between industry players is for control of the ecosystem and user experience, and the owner of the ecosystem will benefit the most in terms of revenue and user loyalty. We predict that most users will use no more than five mobile applications at a time and most future opportunities will come from niche market killer applications."

Money transfer will have a strong appeal to users in developing markets, and most services signed up several million users within their first year. However, challenges do exist in both regulatory and operational risks. Because of the fast growth of mobile money transfer, regulators in many markets are piling in to investigate the impact on consumer costs, security, fraud and money laundering.

On the operational side, market conditions vary, as do the local resources of service providers, so providers need different market strategies when entering a new territory.

Another service, which Gartner expects to be most disruptive in the next few years, is location-based services (LBS). This forms part of context-aware services; a service that can grow the LBS user base globally from 96 million in 2009 to more than 526 million in 2012. LBS is ranked No2 in Gartner's top 10 because of its perceived high user value and its influence on user loyalty. Its high user value is the result of its ability to meet a range of needs.

As the mobile platform is used to drive sales and marketing opportunities, mobile search will also gain popularity. To achieve this, the industry first needs to improve the user experience of mobile search so that people will come back again. Mobile search is ranked No3 because of its high impact on technology innovation and industry revenue. Consumers will stay loyal to some search services, but instead of sticking to one or two search providers on the internet, Gartner expects loyalty on the mobile phone to be shared between a few search providers that have unique technologies for mobile search.

Mobile browsing is another widely available technology present on more than 60 per cent of handsets shipped in 2009, a percentage Gartner expects to rise to about 80 per cent in 2013. Gartner has ranked mobile browsing No4 because of its broad appeal to all businesses. Mobile web systems have the potential to offer a good return on investment. They involve much lower development costs than native code, reuse many existing skills and tools, and can be agile. Therefore, the mobile web will be a key part of most corporate business-to-consumer mobile strategies.

The health sector, according to Gartner, will also tap the potential of the mobile. Mobile health monitoring is the use of IT and mobile telecoms to monitor patients remotely, and could help governments, care delivery organisations and healthcare payers reduce costs related to chronic diseases and improve the quality of life of their patients. In developing markets, the mobility aspect is key as mobile network coverage is superior to fixed network. Currently, mobile health monitoring is at an early stage of market maturity and implementation, and project rollouts have so far been limited to pilot projects. In future, the industry will be able to monetise the service by offering mobile healthcare monitoring products, services and solutions to care delivery organisations.

Though mobile transfer was given a higher ranking, mobile payment has not received that status. According to Gartner mobile payment usually serves three purposes. First, it is a way of making payment when few alternatives are available. Second, it is an extension of online payment for easy access and convenience. Third, it is an additional factor of authentication for enhanced security.

Mobile payment made Gartner's top 10 list because of the number of parties it affects - including mobile carriers, banks, merchants, device vendors, regulators and consumers - and the rising interest from both developing and developed markets. Because of the many choices of technologies and business models, as well as regulatory requirements and local conditions, mobile payment will be a highly fragmented market. There will not be standard practices of deployment, so parties will need to find a working solution on a case-by-case basis.

Popularity of mobile content has also driven mobile advertising to grow in all regions through the downturn. It is driven by interest from advertisers in this new opportunity and by the increased use of smartphones and wireless internet. Total spending on mobile advertising in 2008 was $530.2 million (Dh1.94 billion), which Gartner expects will grow to $7.5bn in 2012.

By Staff Writer

© Emirates Business 24/7 2009