Boulder, Colorado Gets Pay-By-Cellphone

Last Thursday, a Boulder, Colorado company called Mocapay was giving away free Haagen-Dazs ice cream cones to demonstrate their new pay-by-cellphone service. This writer volunteered, and for the cost of a text message to their short-code number with the word "cone," I was good to go. I took the reply message to Haagen-Dazs and ordered a cone, gave them the code, got my receipt and was on my way with free ice cream on a hot summer day.

Mocapay, which stands for MObile CAsh PAYments, is a company which came to Boulder from the San Francisco Bay area, has been evolving for the last few years. At this point, they have a network of dozens of businesses in the Boulder, Colorado area which accept their "currency," allowing customers to use their cell phones to pay from their checking or savings account. A list of participating businesses is available at their site. Mocapay says that their technology is even more secure than current credit card technology.

The process for using Mocapay is simple, and may become even more so in the future. When a user sends a text message to Mocapay, the response code is the key to the transaction, and it's only good for about fifteen minutes. The businesses use a separate Mocapay terminal (similar to those used for credit cards) that looks like a small printing calculator. Mocapay says that they are working on integrating their technology into the products of popular point-of-sale terminal manufacturers. Mocapay does indicate that user mobile numbers will be available to businesses for targeted text message promotions, and Mocapay's strategy does involve working as a marketing partner with businesses, including offering exposure as early adopters of what they say is a highly visible new technology.

While more men than women seemed to be taking advantage of the free ice cream offer, both men and women seemed to be interested in using the new technology to shop in the Boulder area. Boulder has a large upscale, technology-savvy population and is home to a large university, all factors which could increase adoption of the technology in the test market. Walking down the Pearl Street Mall, cell phones - and potential users - were seen in large numbers.

Mobile phone payment systems are growing in Asia, where credit cards are sometimes less popular than in the US while mobile phones are everywhere, says the Wall Street Journal. PayPal, a US transaction processing company associated with eBay, is also expanding its service to mobile phones. The cost of Mocapay to businesses currently is a fixed nineteen cents per transaction, and settlement is made daily, according to the company. Consumers do not pay for using Mocapay, says the company. Purchases possible using a cell phone range from ice cream and sandwiches to records, books, wireless phone products, and even gourmet chocolate, according to Mocapay's website. Where the previous generation made the transition from checks and cash to credit cards, then debit cards, payment by mobile phone services such as Mocapay are aspiring to be the next step in transforming the consumer's wallet. The company offers a demonstration video to see how it works in action.

Connie Ling, "Asians Already Are a Step Ahead
In Making Small Purchases Online,"http://interactive.wsj.com/public/current/articles/SB986229616928276297.htm