O2 ends NFC phone payment trial

Technology that turns mobile phones into virtual wallets has been successfully trialled by O2.

The network operator said that results from its O2 Wallet pilot, Europe’s largest trial of Near Field Communications (NFC) technology on a mobile phone, revealed clear consumer demand for such services.

NFC is a short-range high frequency wireless communication technology that enables the exchange of data between devices over about a 10cm (around 4in) distance.

Nine out of ten of the 500 London-based O2 customers who took part in this latest pilot said they would be happy using NFC on a mobile phone. Convenience and ease of use were seen as the main benefits.

Claire Maslen, head of NFC, said: “Imagine going out for the night and only taking your mobile phone with you.

“This trial takes us one step forward to achieving this by demonstrating that people want the convenience and practical benefits offered by services like the O2 Wallet.”

The chance to have Oyster on their mobile phones was particularly popular with nearly 90 per cent of the trialists.

Over two-thirds also said that they would also be interested in having the Barclaycard Visa payWave contactless payment facility installed on their mobile.

This was helped by the growing number of retailers across London including Books Etc, Chop’d, Coffee Republic, EAT, Krispy Kreme, Threshers and YO! Sushi that accept payWave for payments of up to £10.

However, status was also important to users. A Nokia 6131 was used in the O2 trial, but having a choice of handset was crucial to 85 per cent of those taking part; they said that the make and model would influence their decision to take up NFC services.

Security was also an issue. Any of the phones in the trial could be blocked if they were lost or stolen. However, in future, NFC is considering moving the technology to the SIM only and prompting for passwords periodically.

To ensure that interest is maintained, O2 has proposed an industry taskforce. This will bring together the major players, including mobile operators, handset manufacturers and key players from the transport, retail and finance sectors.

The O2 trial took place over six months between November 2007 and May 2008.