JULY 3, 2013 • Owners of Sony electronic devices in the United Kingdom can now add funds to their PlayStation Store or Sony Entertainment Network accounts by using a valid mobile phone account. Charges will either appear on the user’s next phone bill, or will be deducted from their pre-paid plans. Sony added the option in a bid to reduce the number of steps needed to finalize transactions, although consumers will have to respond to a security text message sent to their smartphone. The mobile transactions are being handled through the payments platform of San Francisco-based Boku.
Impact: Using a smartphone to conduct all manner of everyday transactions has been commonplace in Europe where credit cards are nowhere near as prolific as mobile devices. Consumers are quite comfortable using their phone’s near-field-communication (NFC) option to pay for a trolley ride, or their carrier account to pay for virtual item purchases. Sony was one of the pioneers in seeding NFC capability in Japan back in 2004, so its adding carrier payment capability in the U.K. raises few eyebrows. What does seem strange is that it took so long. We suspect that Sony’s move is a reaction to a similar mobile phone carrier payment option for Xbox Live in the U.K. and Ireland that went live last May. That transaction functionality is being shepherded by Phonovation based in Dublin, Ireland. The company is also set to roll out Xbox Live payments to the Czech Republic, Germany, and Spain later this month. So Sony is playing catch-up here. Regardless, we think more frictionless payment options make a lot of sense for consumers and console makers alike. According to the Central Bank of Ireland, 56% of the Irish population either doesn’t have a credit card or prefers not to purchase items on credit, and in the U.K. the number grows to 65%. Crucial for console makers is that the crucial audience of younger consumers are far more likely to have a smartphone than a credit card in these countries. As making purchases via smartphone is becoming much more popular in the United States, it’s only a matter of time before we see such option appearing on this side of the Atlantic.