Facebook Launches Simple Mobile Payments
readwriteweb.com
readwriteweb.com
Whatever PayPal does, Facebook can do too.
When I buy something, I accept that there's somebody selling something, and frequently a credit card company facilitating that transaction. Why do I need Facebook to know what I'm buying when purchasing things has already been made easy-enough for most cases? With Facebook inserting themselves into the checkout process, I'd be giving them something of value without really getting anything for it - so why would I do it?
You're certainly far, far from the norm because PayPal has tens of millions of active accounts and even people who hate it use it.
So, the biggest barrier for fb for me has nothing to do with trust and more to do with acceptance by merchants.
[imo] should read
and even people who hate it _have to_ use it
Contrast that with facebook: When i received my facebook credits payments, their support team was quite clueless when i asked them what is their billing address and VAT no (required here in Urop). they even gave me the wrong info that the payments came from the US, which resulted in me being fined for misreport.
Trust facebook? Maybe in 10 years.
Unless you consider that you're now not only giving them data about your private life, friends and preferences, you add the 'successful conversion, bought X' data point to a data set that is already too big by my standards. It's like combining my address book, private pictures, credit card bills and entering that data into a huge corporate database so that I can chat and plough a virtual field.
It just seems like an extra unnecessary convoluted layer to me. Having a credit balance over real money balance is unnerving for me and would mean I would never put too much money on at any one time, there's too much risk of something bad happening like quick devaluation. Also it would probably be far less liquid and harder to convert back to cash.
They don't have credit cards but are now able to make in app purchases.
Think of it like the anti-bitcoin.
Would be even more interesting if Google pull Facebook app out of the Android Play Store. (I bet Google would be very happy to do so)
Not a fan of the trend, but I suppose it does unify the user experience.
Short term, paying with FB for physical goods (eg. in restaurants, bars) is an unlikely outcome because carrier billing involves giving up an enormous percentage of the transaction to the carriers.
In the U.S., carrier billing typically involves yielding a 40 - 50% margin to the carriers. In Europe, the percentages are lower -- carrier billing is a more mature market there -- but they still top out around 20 - 30%. In developing markets, margins can go as high as 75 - 80%.
I don't know what sort of relationship FB has built with the carriers and what sort of percentage merchants using the billing system will ultimately end up with -- after all, both FB and the carriers will take a cut -- but I would be surprised if it isn't in line with the current percentages charged for carrier billing.
For virtual goods, carrier billing service providers claim the frictionless nature of the transaction and the reach (6 billion mobile subscribers globally) make up for the small margins.
Long term, of course, things could very well turn out differently.
The biggest failure of all the 'credit' and 'mobile carrier' solutions is the 15$-50% take they deduct, making it worthless for anything but virtual goods
I wonder how Apple will react to that. They're pretty keen on banning apps that don't give them 30% of in app purchases. If Apple doesn't reject this they will have some explaining to do.
What happens is that Mark calls Tim, their people meet, and a bunch of lawyers write up a contract that the rest of us will never see.
Given the small amount of money Apple makes from the store I would imagine that user experience is a higher priority for them. It reflects very badly on Apple if their users are able to hand over credit cards to dodgy third parties through 'their' apps.
I don't think they can execute the product properly, from either a point of purchase proposition or from an easy-to-use perspective. PayPal struggles with complexity, and I believe Facebook's offering will not only be more confusing than PayPal but more complex. The world only needs (and or will use) more payment solutions if they're radically better, I don't see Facebook building that product, despite the user base they can tap into.
I think Facebook is failing to fix the problems in their existing core product, while they lurch forward into areas they have demonstrated a limited ability to deliver on.
I remember reading that their are some online games or communities in China that have billion of dollars worth of their own currency in the market. It is so large that they fix the fluctuations to the local exchange rate.
Unsure if this is the same story, but (Online) Gold Farming is estimated to be worth $3billion. (1)
Maybe FB are looking to mimic this growth. Add in the psychological and control aspects and you have your very own economy.
http://news.discovery.com/tech/virtual-gold-farming-compared...