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Trends towards fragmentation of the mobile payment market in Sweden
KTH, School of Information and Communication Technology (ICT), Communication Systems, CoS. KTH, School of Information and Communication Technology (ICT), Centres, Center for Wireless Systems, Wireless@kth.
KTH, School of Information and Communication Technology (ICT), Communication Systems, CoS, Radio Systems Laboratory (RS Lab). KTH, School of Information and Communication Technology (ICT), Centres, Center for Wireless Systems, Wireless@kth.ORCID iD: 0000-0001-8350-9440
2013 (English)In: The 29th Annual IMP Conference (IMP2013) proceedings: Building and Managing Relationships in a Global Network: Challenges and Necessary Capabilities / [ed] Minna Rollins and Brian Rutherford, IMP Group , 2013Conference paper (Refereed)
Abstract [en]

In Sweden many new mobile payment solutions and services have been proposed during the last years. Banks and payment providers have proposed different forms of person to person (P2P) and Point of Sales (PoS) services that are tested and taken into commercial use. The Swedish mobile operators have joined forces and formed a joint venture that offers a separate charging solution that can be used for mobile payments and e-commerce, i.e. not using the phone bill. Early 2013 the SMS ticket for public transportation was changed substantially with the entrance of many new actors. 

In this paper we use the ARA model (Activities, Resources and Actors) in order to analyse the new mobile payment solutions and services looking into the activities, roles and responsibilities of different actors. We also apply the activity system approach describing the Activity system content, structure and governance and activity design themes indicating the main value creation drivers. The analysed cases include mobile payment services for P2P transactions, payments in shops, and ticketing for public transport and parking. The technology, services, and new constellations of actors seem to work fine but there are challenges for the adoption of new services both due to both the multitude of solutions as well as the need to register and manage new user accounts with the payment providers offering new solutions.

Place, publisher, year, edition, pages
IMP Group , 2013.
Keyword [en]
Activity system, Actor cooperation, ARA analysis, Business models, Mobile payment services, New market actors, Parking services, Person to person payments, Public transport ticketing, Retailing, Value networks
National Category
Communication Systems Business Administration
Research subject
URN: urn:nbn:se:kth:diva-133720OAI: diva2:663017
The 29th Annual IMP Conference, Atlanta, USA, August 30 – September 2, 2013
Wireless@kth, 6507

QC 20131111

Available from: 2013-11-08 Created: 2013-11-08 Last updated: 2015-08-28Bibliographically approved
In thesis
1. Challenges Related to the Introduction of Innovative Services in the Market: Mobile Payment Services in the Swedish Retail Industry
Open this publication in new window or tab >>Challenges Related to the Introduction of Innovative Services in the Market: Mobile Payment Services in the Swedish Retail Industry
2015 (English)Licentiate thesis, comprehensive summary (Other academic)
Abstract [en]

Mobile payment services are expected to be the next step of the electronic payment evolution. However, the level of penetration in European countries is lower than expected. The focus of most academic research has been in two main areas: (i) mobile payment adoption by consumers and (ii) technical aspects of the service. Consequently, a number of themes remain under-researched. In order to expand knowledge on reasons that affect the wider penetration of mobile payments, challenges related to the introduction of mobile payment services in the market have been explored in this thesis.

More specifically, this research has addressed two problem areas: (i) why mobile payments have not been widely adopted by merchants; and (ii) what effects that the introduction of mobile payments has had on the business networks of the involved actors. As an example, we use the mobile payment services applied in the Swedish retail industry. The study is focused on the main groups of stakeholders – the mobile payment providers, the retailers, and the consumers.

First, this study has helped to identify what different stakeholders expect of mobile payments and how these services correspond to their needs. In order to analyse the expectations of stakeholders, we have developed an analysis framework based on the theory of diffusion of innovations, the Technology Acceptance Model (TAM), and the theory of network externalities. The analysis highlights the expectations of stakeholders and helps to understand what kind of mobile payment service merchants expect and are willing to adopt. One key finding is that existing mobile payment services for retailing could be further improved in order to ensure an enhanced purchasing process for consumers.

Second, the research has explored the impact of mobile payment services on the business networks. In order to analyse the relationships and cooperation between business actors, and changes in business strategy and network structure, we used the approach proposed by the Industrial Marketing and Purchasing (IMP) Group. The performed analysis illustrates the following changes in the structure of business networks for the traditional payment solutions (bank cards): (i) emergence of new business actors (i.e. independent mobile payment providers); (ii) new roles and activities of business actors; and (iii) exclusion of traditional business actors (i.e. banks) from the mobile payment systems.

All these changes lead to increased complexity of relationships and increased level of interdependence between business actors within the networks. The following changes in the strategies of involved actors have been identified: (i) mobile payment providers seek to achieve a control over the business network; (ii) the retailers affect strategies of the mobile payment providers; (iii) the marketing strategies of business actors include cross-marketing in different sectors. All these changes result in additional value and enhanced quality of service for consumers.

In order to analyse a complex and multidisciplinary area such as mobile payments, it is beneficial to use more than one analysis approach. A combination of different complementing methods helps to explore different aspects of the phenomenon and provides a more comprehensive overview of several research aspects.

This work contributes to the academic research of mobile payment service adoption by merchants through proposing a theoretical analysis framework. More specifically, the research addresses a new area – expectations of retailers when new solutions are introduced. The framework consists of the following criteria and aspects: technological feasibility, economic benefits, lower service costs, added value of services, network externalities and the problem of critical mass, and finally, ease of use. This framework helps to identify what merchants can expect of mobile payment services.

Another area of contribution is the analysis of the effect that mobile payments make on the actors and business networks of traditional payment services. The introduction of new services results in emergence of new business actors, a need to establish new relationships, and increased complexity of a business network. Moreover, in order to succeed, cooperation between all network actors is needed. As a result, business actors have to adjust their services and strategies according to needs of others.

Place, publisher, year, edition, pages
Stockholm: KTH Royal Institute of Technology, 2015. xiii, 78 p.
TRITA-ICT-COS, ISSN 1653-6347 ; 2015:06
mobile payment, adoption, business networks, merchant, stakeholders’ expectations, consumer expectations, organisational adoption, retail, innovation
National Category
Business Administration Information Systems, Social aspects Communication Systems
Research subject
Economics; Information and Communication Technology
urn:nbn:se:kth:diva-172340 (URN)978-91-7595-536-0 (ISBN)
2015-09-18, Aula A, Electrum, KTH-ICT, Isafjordsgatan 26, Kista, 13:00 (English)
The Jan Wallander and Tom Hedelius Foundation

QC 20150828

Available from: 2015-08-28 Created: 2015-08-19 Last updated: 2015-08-28Bibliographically approved

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