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Thursday, 22 January 2009 00:00

Sybase buys paybox to tap mobile payments market

Sybase, parent company of mobile messaging and mobile commerce provider Sybase365, has bought German mobile payment system specialist paybox Solutions to help it tap into the rapidly growing mobile payments market.

Sybase said the deal would enable it to provide mobile operators, financial institutions and merchants with a full suite of mobile payment solutions enabling their customers to undertake person-to-person remittances, make payments for goods and services, top-up mobile airtime and pay bills from a mobile device, in both developed and emerging markets.

Paybox will be integrated into Sybase365. The two companies announced a partnership last November and Matthew Talbot, Sybase365 vice president mCommerce, told iTWire the relationship had evolved from there. "As we started to work on customers together we saw that our strategies aligned completely and paybox filled part of the gap in our technology offering." He said that Sybase expected to announced the first customer win through the partnership at the 3GSM show in Barcelona in February.

Sybase365 presently offers a limited range of mCommerce technologies to mobile operators that enable customers to make payments charge to their mobile account, via premium SMS and by direct interface to carrier billing systems. However mobile operators charge hefty commissions to third parties and their desire to limit risk limits the value of transactions.

The Paybox technology, in contrast, interface direct to financial institutions' systems enabling payments to charged to bank accounts and to credit and debit cards.

According to Talbot, customers are primarily mobile operators and financial institutions which aggregate large number of merchants, but he said the paybox technology could be sold to and used directly by a large merchant. The Paybox software is available to run stand-alone under licence or as a managed service.

Talbot said that about 20,000 merchants presently accept payment for goods and service via Paybox technology. "In Germany with O2 and Vodafone they have launched a service called Mpath that allows consumers to buy digital goods and top up their accounts direct from a bank account instead of using premium SMS. In Austria the paybox technology runs across all the operators you can pay for taxis goods and service by sending and SMS the SMS is not dong the charging it is just the bearer o the transaction."

In Australia Sybase365 is hoping to leverage the relationships its parent company has with local banks to sell the paybox technology. A number of global banks active in Australia are Sybase365 customers, Talbot said, but the primary relationship is overseas.

Paybox has a sales representative in Melbourne, but no customers in Australia at present. It made its local debut on the German Pavilion at the CeBit 2008 expo in Darling Harbour, Sydney.

Talbot said that Australia was not the most mature market for mobile payments, thanks to the conservatism of the local banks. "Apart from using mobiles for two factor authentication and for some marketing they have been slow to react,"

However this could soon change. At the GSM World Congress in Barcelona in February 2008 the GSM Association identifed mobile payments as one of the top priorities for mobile operators over he next 12-24 months.

Research undertaken by Edgar Dunn put the potential global market for mobile transactions at $US250b and for enablers, where Sybase365 and Paybox operate, at $US1.5b. Juniper Research forecasts the mobile-payment market will grown from $US2b in 2007 to $22US billion by 2011.

ABI Research recently released a report identifying mobile financial services as likely to serve more than a billion customers in 2013. Aite Group, a US-based analyst house, estimates the mobile banking opportunity to grow from $US13.9m in vendor revenues to $US26m in the US market in 2009 with vendor deployment expected to double in the same period.

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