Consortium Misses Deadline for Singapore NFC Launch; Project Tests Government-Led Approach
The high-profile commercial launch of NFC mobile payment planned for Singapore has fallen behind schedule, NFC Times has learned.
Infocomm Development Authority, or IDA, the country’s telecommunications and information services regulator, which is overseeing the NFC project, had set a tight deadline for the launch of eight months after the award of the contract. IDA selected the winning consortium in its “Call for Collaboration” tender request in late October, which meant the project was mandated to launch late last month.
The IDA awarded the project after the lengthy tendering process to a seven-member consortium led by France-based trusted service manager Gemalto.
The agency announced that there would be at least three mobile-payment services for the launch and later other services. This is part of the IDA’s grand vision to create an interoperable NFC platform for the city-state that any service provider on the island could plug into.
But none of the services has yet launched and two IDA officials involved in the project declined to give an updated launch schedule when asked by NFC Times. Sources, however, said revised estimates now put the delay at roughly two months.
UPDATE (Aug. 3, 2012): The IDA issued a press release Aug. 3 saying that the Gemalto-led consortium had announced its readiness to launch NFC mobile-payment services. The authority said the consortium would be rolling out three payment applications in “coming weeks,” though didn't specify an exact date on which the project would launch.
IDA was likely referring to a planned launch by StarHub and two other consortium members, EZ-Link and DBS bank. The three partners had announced last year they would launch the NFC project by mid-2012, but the project was delayed.
StarHub announced Aug. 3 it would launch its SmartWallet smartphone app later this month, along with payment services from DBS and EZ-Link.
StarHub's NFC SIMs would carry DBS' One.Tap PayPass credit application, along with an e-purse from EZ-Link that could be used for retail purchases and a separate prepaid MasterCard PayPass service, also from EZ-Link. EZ-Link's NFC e-purse will not apparently be used for transit fare collection, like it's contactless cards, however.
At launch, consumers would be able to tap to pay at more than 30,000 contactless terminals at retail locations and taxis, the IDA said. There are more than 20,000 point-of-sale terminals in Singapore supporting PayPass. The other terminals probably support the CEPAS application, used by EZ-Link.
StarHub said its SmartWallet app also can be used to browse, download and redeem "virtual coupons." The consumers will be able to redeem the coupons along with the payments with just one tap of the smartphone at certain merchants accepting PayPass, said StarHub.
The telco indicated it would make at least three NFC smartphones available for the launch, the Samsung Galaxy S lll, Sony Xperia Sola and Xperia S, all Android phones. Subscribers will need to change their SIMs to those that can handle NFC applications. END UPDATE.
While delays are not uncommon in NFC projects, a delay for the highly structured Singapore Call for Collaboration project is not expected to be taken lightly by the authority.
A spokeswoman for Gemalto’s Asia-Pacific region also declined to say when the project would launch or what has caused the delay.
“Gemalto has a time-honored policy of respecting our customers' confidentiality,” she said in a statement. “All partners in the consortium are working closely to bring the benefits of NFC services to Singaporean consumers in the best way possible. We look forward to communicating more on these exciting new services when they are officially launched.”
Besides Gemalto, the consortium is made up of Singapore’s three mobile operators, SingTel, StarHub and M1, along with two major banks, DBS and Citibank Singapore, and large transit fare-collection and payment service provider EZ-Link.
DBS, EZ-Link and Citibank would provide the payment services to subscribers of the three operators, with the applications downloaded over the air and managed by Gemalto. The vendor also is serving as project coordinator.
Gemalto would later collaborate with other service providers, offering mobile couponing and ticketing and digital advertising through NFC smart posters, among other services, according to the project description.
The same day that the IDA announced the award of the Call for Collaboration, last Oct. 25, mobile operator StarHub announced it was preparing to launch NFC service with DBS and EZ-Link by the mid-2012 target date.
A spokeswoman for StarHub said she couldn’t offer an update for the launch schedule, however. And consortium members SingTel, Citibank and EZ-Link referred all questions to IDA. DBS did not respond to a request for an update.
Sources have said that one reason for the delay is a certification problem for the bank payment applications, which must support Visa payWave or MasterCard PayPass. That means they must get certification from one of these organizations. The bank application would have to sit alongside the EZ-Link service, which probably would be a closed-loop application complying with Singapore’s national payment technology standard, CEPAS.
NFC Times could not confirm that the certification issue was part of the reason for the delay.
The relatively short eight-month period between the selection of the consortium and the mandated launch left little room for unexpected issues for the consortium lead, Gemalto, which is said to have experienced some turnover among its technical staff in Singapore over the past several months.
While Singapore is a small market, with only a population of 5 million, the IDA-led project is a test of whether government mandates for an interoperable NFC platform could work for the island nation or for other small countries.
The contract comes with funding from IDA, which at the time it awarded the contract said that the agency and the consortium members would invest a combined S$40 million (US$31.6 million) in the project–a relatively lavish sum for a small project.
IDA would own the intellectual property for the platform that Gemalto and the consortium partners create, but the authority said it would grant industry players the right to use it. And IDA said it would not restrict use of the platform. In fact, it would require the winning “trusted third party,” or TSM, which is Gemalto, to publish its prices and list of services.
In addition, the authority said it wanted the TSM and also the telcos or other secure-element owners in the consortium to offer an “open-access” business model for at least three years–that is, to open the platform to new service providers.
UPDATE (June 16, 2012): Gemalto announced last week that its TSM data center in Singapore, which is to serve the IDA project, has received certification from both Visa Inc. and MasterCard Worldwide to provision the respective applications from these payment schemes. END UPDATE.