On 3^rd October 2013 Sprint announced the launch of Pinsight Touch, an open platform enabling service providers, such as banks, access solution vendors and transport providers to offer secure NFC services, but not through a Sprint branded wallet. Pinsight Touch addresses one of the primary barriers to the success of mobile wallet propositions highlighted in my recent report, ”Significant Challenges Ahead in the Mobile Wallet Battleground” – that service providers are prioritizing the development of own branded mobile applications ahead of horizontal wallet services. There are two main reasons for this:

1.       Keeping the customer relationship and engaging directly with customers

2.       Differentiating from competitors and competitor applications

With the Pinsight Touch NFC platform banks, transport companies and access vendors can leverage secure NFC in own branded applications, rather than being confined to an operator branded environment.

I just had a call with the Pinsight Media+ team and managed to get a little further under the bonnet:

1. The secure element is not a SIM card, but a secure element or chip on the motherboard of the phone. Sprint claims that it started to seed the market with devices two years ago and that a “significant number” of its device vendor partners have been supplying devices preinstalled with Sprint’s secure element. This is pretty significant because it means Sprint controls a piece of the OEM device – not a model we have seen outside of Felica in Japan. It’s not the kind of deployment Apple will be involved with and I’m surprised Sprint has persuaded OEM partners to add join in, so I would definitely like to understand more – is Sprint licensing this space from OEMs or footing the cost of the secure element?
2. Secure credentials can be leveraged by third-party developers! This means that a bank’s payment application could be used within the application of a retailer, to enable the retailer to support NFC payment directly from its own application. Clearly, the need to maintain brand and keep users engaged with its own apps are two reasons why some banks may not wish to go down this route, but nevertheless it is a compelling model to democratise the banks payment applications beyond the confines of its own app.

I’m very impressed with how Sprint has managed to differentiate its offering from other operator mobile wallets, but key questions still remain:

1.       Is Sprint’s a large enough player to attract banking, retail and transport partners to its platform? So far, with no partners announced we’ll need to be optimistic that the open nature of the Pinsight Touch platform will be sufficient to attract service providers. However, Sprint should realize that optimism alone will not guarantee success.

2.       Is NFC still the horse to back as the leading mobile payment interface, particularly with Apple and PayPal pushing for Bluetooth Low Energy (BLE) based beacons? While I am confident that NFC will play a role in in-store mobile payments the landscape is increasingly fragmented as retailers like Starbucks and Merchant Customer Exchange (MCX) experiment with alternatives options such as QR and barcodes.

3. It’s unclear how Sprint intends to monetize its platform, beyond trying to attract as many partners and charging fees to on-board them to the platform. At least with a branded mobile operator wallet carriers can control real-estate on the phone screen to deliver promotions, offers, coupons and targeted mobile marketing. By delivering a platform only approach Sprint is passing up these opportunities.