A mobile commerce company in Berkeley, Calif., says it has devised a means to enable mobile phones to communicate with chips in attached stickers to support true two-way communication for contactless payments.
Blaze Mobile Inc. said its patent-pending "smart" contactless sticker can send and receive payment information and can communicate directly and immediately with phones without the need for a carrier network or Wi-Fi connection. The news was announced Tuesday.
Michelle Fisher, Blaze Mobile's chief executive, declined to say how the sticker's chip communicates with the company's Blaze Wallet application, which can run on most smartphones, including Apple Inc. iPhones and Research in Motion Ltd. BlackBerry devices. "It's like Coca Cola's recipe — it's a trade secret," she said in an interview.
Once the sticker becomes available during the first quarter of 2011, consumers may use it in connection with the wallet app to store and select from multiple payment options, including credit, debit and prepaid cards. Blaze Mobile said its sticker is also is usable for building, car and health care data access.
With the Blaze Wallet app, when the user picks the type of payment to use on the screen, it lets the chip in the sticker know which type of contactless payment to initiate, Fisher said. The chip then sends the completed transaction details back to the app for sorting and record keeping.
Users also could use the stickers to communicate with other near-field communication chips, such as ones embedded in posters to access movie trailers, Fisher said. And they could deactivate lost or stolen stickers remotely.
Blaze Mobile in 2006 developed its initial contactless sticker to address the lack of phones with built-in NFC chips. The original sticker sends data only to terminals that can read the contactless transmissions, and the purchase details traverse to Blaze Mobile's servers using the company's ties to financial institutions' online banking services. Blaze Mobile then delivers the digital receipt to the mobile device over the carrier network. The original sticker supports only Blaze Mobile's cobranded MasterCard Inc. prepaid card. With the new sticker, consumers may access any issuers' cards.
Blaze Mobile gets revenue from its original sticker by receiving a share of the transaction interchange earned by its undisclosed issuing partner and from the advertising its sells for its wallet app, Fisher said. The revenue model will differ a bit for the new sticker, she said.
The new sticker eliminates potential problems that can arise when the wireless network is not available to transfer the data to the phone by instead communicating the transaction details directly from the sticker's chip to the phone app, Fisher said.
George Peabody, director of the emerging technologies advisory service at Mercator Advisory Group of Boston, said that as companies roll out NFC capabilities, they should be clear on what they are trying to accomplish.
"Now is the time issuers and merchants want to be looking at, 'How do I use NFC?' " Peabody said, "and for that decision to be made you need a robust ecosystem around it, which includes clarity."
Blaze Mobile has not said publicly how many contactless stickers it has distributed since it launched the initial version. However, it might provide a total once the new sticker rolls out, Fisher said, noting Blaze Mobile also may announce early next year reseller agreements involving various organizations.
MasterCard announced in March 2009 that it was offering Blaze Mobile's original sticker. The wallet app can access accounts at more than 8,000 financial institutions that offer online access, including Citigroup Inc. and Bank of America Corp.
