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When technological superiority is not enough: The struggle to impose the SIM card as the NFC Secure Element for mobile payment platforms

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  • de Reuver, Mark
  • Ondrus, Jan

Abstract

Mobile network operators have long played an essential role in the Near Field Communication (NFC) mobile payment ecosystem. In most implementations, the SIM card has been the main technical component to secure payments. Currently, mobile payment providers are increasingly planning to place the Secure Element (SE) for authentication in the handset or cloud, rather than on the SIM card. This paper unveils factors that influence stakeholder preferences for the SE location. To structure the analysis, we use a multi-level framework based on concepts borrowed from multi-sided platform theory. Using interviews with stakeholders, we elicit themes and preferences for each level of the framework (provider, technology, and user). Our findings explain why mobile network operators, despite their superior technology, will likely lose the battle for control in the mobile payment ecosystem.

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  • de Reuver, Mark & Ondrus, Jan, 2017. "When technological superiority is not enough: The struggle to impose the SIM card as the NFC Secure Element for mobile payment platforms," Telecommunications Policy, Elsevier, vol. 41(4), pages 253-262.
    • Handle: RePEc:eee:telpol:v:41:y:2017:i:4:p:253-262
    DOI: 10.1016/j.telpol.2017.01.004
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    2. Kuo, Ren-Zong, 2020. "Why do people switch mobile payment service platforms? An empirical study in Taiwan," Technology in Society, Elsevier, vol. 62(C).
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    4. Kazan, Erol & Tan, Chee-Wee & Lim, Eric T.K & Sørensen, Carsten & Damsgaard, Jan, 2018. "Disentangling digital platform competition: the case of UK mobile payment platforms," LSE Research Online Documents on Economics 86345, London School of Economics and Political Science, LSE Library.
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    7. Mosterd, Lars & Sobota, Vladimir C.M. & van de Kaa, Geerten & Ding, Aaron Yi & de Reuver, Mark, 2021. "Context dependent trade-offs around platform-to-platform openness: The case of the Internet of Things," Technovation, Elsevier, vol. 108(C).
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