Migration from the Wallet to the Smartphone: Barcodes

Bar Code scanned directly from a Smart Phone

Do you carry any barcodes with you in your wallet?  What about your keychain?  Take a look and count all of the loyalty cards, membership cards, coupons, and all of the other places were a barcode me here. I found four in mine, and I have thrown them all away in lieu of one of the many apps that are available on smart phones information for you. That was about three months ago. Since then I realized one sobering fact: this technology does not work efficiently, yet.

Today, Masabi Ltd. announced that it has secured $2 million to support the global rollout of a barcode-based mobile application designed to let consumers buy and use train tickets.  Like most new applications, Masabi, and their new investor m8 Capital, are playing the long game.   But I’m sure they are aware of the limitations of the technology today, but in the future this may prove to be a wise sector.

Here’s why:

Only late generation scanners can read a barcode from a Smartphone because the laser of most barcode scanners tend to reflect off of the glass of most Smartphones.

The folks at Masabi and m8 were not born yesterday, and their gamble should pay off when two things happen in the future: Better scanners and more users.

IT’S THE SCANNER

Try using a bar code off of your Smartphone at your local grocery store.  It simply never works.  Most clerks never even try to scan the code, opting instead to enter the ‘human readable’ number.  Other companies that offer these services include Card Star, Key Ring, Place Pop, Cardigan, Card Bank; each of these companies attract similar results, and complaints. The apparent failure of these examples and other past barcode apps was the fault of extra hardware, such as the devices known as POS scanners. These products still provide a convenient way of carrying all of these numbers with you on your mobile, and continue the migration from the wallet to the Smartphone.

The problem is the laser because it reflects of the glass of the Smartphone. But, some new scanner on the market is showing real promise.  For example, the Wasp WDI4500, the Socket Pro Series 7, and others.

GoMo News wrote an article that claims, “Mobile barcodes are on the verge of becoming a global phenomenon…” It is important to mention that the article was written independently but sponsored by NeoMedia Technologies.   I can tend to believe GoMo News and their integrity, but the connection to NeoMedia is worth mentioning.

FUTURE PROLIFERATION

Also, CTIA announced a “Camera-Phone Based Barcode Scanning White Paper” (PDF) during a keynote event where they also demoed the technology. In the paper, they endorse two bar code formats: the open standard  Data Matrix and the proprietary  EZ Code. CTIA Vice-President of Wireless Internet Development Mark Desautels predicted that handsets using the technology will be widely available in 12-18 months.

That estimate may be aggressive by 3 to 5 years because economic recovery from the latest recession is causing many companies, merchants included, to postpone any additional capital expenditures. That means the companies that tend to use bar codes in their business are much less likely to make an investment in new technology within the next year.

The world of near-field communications is growing steadily and various pundits have their Opinions about which technology will win. There is significant to date about whether or not barcode–based mobile applications fits into the category of NFC because, typically, there is an analog component as opposed to a purely digital or radiofrequency–based communication at play.

MORE GOOD NEWS?

More good news for bar code–based applications is in the fact that mobile barcodes are a form of “pull technology” which is a permission-based way for a consumer to engage with either an advertiser or a merchant. Pull technology becomes very important when you consider the fact that security is the most important factor when a consumer considers using M-Commerce, E-Commerce, Mobile Payments, or other payment types.

This is a very important attribute since there is a great deal of consumer angst and regulatory concern about intrusive mobile marketing: mobile barcodes are a world away from pushing unsolicited spam via SMS or MMS. Big brands are understandably wary of engaging in any advertising activity that compromises their reputation by alienating their customers and have stayed away from these kinds of push campaigns. –GOMO News Article

In this example, the consumer would initiate the transaction by summoning the barcode to appear on his or her mobile phone, and then present the barcode to a merchant, and advertisers, or some other type of barcode reader device.

THE MOBILE WALLET WILL WIN

Item by item, one by one, the items in your wallet are moving to your Smartphone. While it is true that in this example I succeeded in removing only four cards from my wallet and relocated the content of those cards to my smart phone there is still a long way to go. Barcode technology will become easier to use, and more effective for the people who use it, as new scanners and devices begin to proliferate the market.

© 2010 David Schropfer
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