|Issue:||Asia-Pacific I 2002|
|Topic:||Smart Cards – Getting Back On Track|
|Organisation:||Telecom Business Unit|
Smart Cards are increasingly used by service providers as a vehicle for end-user applications. Smart Cards are repositories of personal information embedded within protective systems that give users control over who can access it. The cards identify the user and coordinate payment makinge secure online purchases, financial transactions and overseas roaming possible. Service providers anticipate the creation of a SIM card activated global “trusted platform” to manage the different identities and relationships of the end-user with a host of services.
Smart card technology has moved on significantly since the 1990’s. Then, smart chip technology was used primarily to insure data security. It is only today, roughly 10 years after smart cards began to be widely distributed, that card issuers and smart card solution providers are beginning to perceive their real value and exploit, develop and adopt smart card-based solutions. Traditionally, it has been the operator or handset manufacturer that has driven the uptake of new technology and services by pushing it out to the market. The situation is no different today, however operators face increased competition and have, also, to adapt to a target audience that is much more cynical and aware of new technology. The huge choices in technologies, such as mobile devices and applications, have led consumers to become much more tech-savvy in choosing and deciding what technologies and services are relevant to each. Operators now challenged by increased competition, customer churn, high cost of logistics and decreasing ARPUs (Average Revenue per User). It could get worse, operators could become mere pipes for the delivery of mobile data services vying with content and service providers for a share of the revenue. For the operator, smart-card based technology is potentially the fastest, most effective, way to combat rising costs, understand their customers better, reduce churn, win new customers and above all, increase ARPU. They can: · learn more about their customers earlier and implement targeted marketing campaigns that will deliver better returns · develop relevant applications that consumers desire or demand · deliver secure and reliable pre and post-issue services · create end-user applications to help differentiate their services offering But who are the end-users operators are targeting with the new services and solutions smart card technology can bring? Do end-users understand the benefits of smart card technology and do they, or should they, really care? What are their requirements? And how can the smart card help them get what they want? Currently, we note, consumers are looking for relevant, improved, services such as mobile transactions, mobile gaming and the ability to download music and video clips whilst on the move. Gartner predicts that by the end of 2003, 80% of mobile telecom devices will be able to to support server-based or downloadable games . Meeting the needs of the mobile end user is a key goal for most operators. The introduction of advanced data services using 2.5G and 3G networks will make mobile services an essential part of the subscriber’s life. The smart card can not only help deliver appropriate and timely services to the end-user, but do so securely and effectively, regardless of where the end-user is. The cards allow the operator to maintain their privileged position with their subscriber while controlling his relationships with content and service providers. For end-users to accept the mobile handset as a method for managing their lifestyles, they need to be easy to use and have the confidence in the levels of security. The smart card can protect the rights of the end-user by giving them a say in who gets access to their information. End-users can be confident that when they use the smart card for payment of goods and services, the card guarantees the transaction by providing trust, digital signatures and encryption. Furthermore, smart card technology makes SIM (Subscriber Identity Module) roaming possible. As roaming exchanges make it more convenient for the user, he will benefit from being able to use data services overseas. The new wireless eco-system: End users stand to benefit from a wealth of new services with the advent of Java. Millions of Java developers, world-wide, are anxious to open their applications to the mobile world. In addition, as the wireless eco-system (value chain) evolves, more providers are actively seeking ways to access the end-user and promote their services. The wireless business used to be a two-way relationship between the carrier and the subscriber. Now, there is an influx of entrants offering a range of new services and content based on data. Traditionally, operators have worked within a walled garden model that is easy to control but limited in terms of the services offered. For data service provisioning, this traditional model simply will not meet end user requirements. In order to continue to provide a relevant service, operators need to encourage content and service providers to work with them. This requires new billing systems and new revenue sharing business models. When opening their networks to content and service providers, carriers need to find ways to retain control of their subscribers. They need to find a happy medium between a fully open approach, that encourages the use of any provider’s mobile data service, and controlling all access so they can bill it. End-users are in an enviable position. They are constantly sought after by operators (their own included) and new service providers offering streams of enticing services. So as not to constantly irritate users with a random barrage of calls, SMS, etc, the operator needs to selectively target what is offered to whom. Smart cards can help them identify end-user types and target services accordingly, either over the air or at the point-of-sale. Who is the end-user? There are different types of end-users with different needs. Corporate users needs secure access to virtual private networks that enable them to work on the move and provide, to the extent possible, the services of a virtual office. Their needs are very different from those of teenagers who are more likely to use data services to download the latest video and music clips onto their handsets. This brings the question of Digital Rights management to the fore. With Smart Card systems managing intellectual property right payments, for example, a user might be allowed to play a given game three times before being asked to pay to continue. Using Smart Cards, data service end-users will be able to manage their own subscriptions over the handset, but it will be important to meet user requirements. The cards have to keep customer data confidential, be convenient to use and give the user control over his personal data. Consumers look for services that suit their needs and that enables them to access their data wherever and whenever they want. Most importantly, they require services that they can trust to be secure. With all the personal data stored on the smart card, and by the mobile carrier, the end-user is potentially in a vulnerable position. However, the smart card has been designed to protect the rights of the end-user,so they have the right to decide who gets access to what information. End-users look for affordability, ease of use and ease of access to services. They are concerned about what happens to the data that the carrier collects about them – who has access to it and how can they protect themselves against invasions of privacy. The SIM card acts as a privacy management controller; it gives the consumer control over the use of their personal information. The end-user will be able to filter the type of data they wish to receive, and when. The card can be used as a proactive marketing tool, allowing the operator to push relevant services, while respecting end user rights and subject to local laws and the request of the individual. The arrival of a true wireless data delivery and service model will mean that wireless devices will become the only device required for daily needs. This will demand greater security for services and applications to prevent fraud and earn end-user trust. Among the first in line are m-commerce, wireless business transactions and payments. Security for transactions becomes essential as subscribers rely increasingly upon their mobile devices to pay their electricity bills, buy airline tickets, purchase stocks and the like. SIM card security features – trust, digital signatures and encryption – guarantee transactions. How can smart card help operators? Smart cards allows the operator to enhance the end-user relationship. It is the only link between the carrier and the end-user, so it is through this medium that the carrier can retain some level of control over the services downloaded and management the subscription. With the data explosion that will accompany GPRS and 3G, there is an even greater need for security. The smart card provides a portable, secure, way for operators and mobile service providers to offer their customers identity proofing. It is the best way to ensure privacy of data, security of transactions and non-repudiation. The smart card is also the most suitable platform for securing data applications while providing the carrier with some level of control within the eco-system. The card plays a fundamental role as an architecture control point; it provides services and offers a secure payment infrastructure. It is uniquely valueable managing control of access to the network and content, privacy, profile management, trust and payment. Success stories · In January 1998, a major mobile communications services provider based in Hong Kong, implemented Over-The-Air solutions to increase the user-friendliness of its rechargeable phone card service for both International Direct Dial (IDD) and local GSM services. The user was given instant access to information through the 24-hour “SmartLine” telephone number allowing for easy on-line updates without changing the SIM card. · Following this, in February 1998 launched the first mobile securities trading system – SmarTrade – was launched, enabling investors to buy and sell securities listed on The Stock Exchange of Hong Kong, and manage their securities account from their own mobile phones utilizing SIM Application Tool Kit technology. Using the SmarTrade service, end-users are informed about their updated stock position – they simply key in order details – stock number, buy or sell, quantity and their PIN to ensure security. · In October 2000, a new SIM card designed for use on both CDMA and GSM networks was launched. The card gives CDMA handsets global roaming capability and the mobile value added services of both CDMA and GSM networks. With a universally capable, removable, smart card, mobile subscribers will be free to roam worldwide and operators will be able to develop and deploy mobile services tailored to these end-user’s needs. Vision for the future The creation of a global “trusted platform”, activated by SIM cards, that manages the different identities and relationships of the end-user The vision is a powerful one, built upon a single technology that is adaptable enough to interact with nearly any communication channel, powerful enough to run many different types of applications, secure enough to resist hacking, and small enough to fit in the palm of your hand. A smart (SIM) card can hold, manage and control the sharing of a wide range of end-user information. It can be easily carried at all times This device can help operators build lasting, valuable relationships with the end-user, providing services adapted to their needs via the channels they prefer. In the near future, the smart card may well be the sole instrument for connecting with the end-user online, over the air, at the ATM, or even through the television. The cards will allow operators to get that elusive personal view of their end-user and market to their distinct needs and desires. Whatever the technology, the smart card will be a constant and accompany the evolution from voice to data. It will help operators migrate their networks expanding their roles to support a wider range of wireless functions. More importantly, it puts the choice of services and security back in the hands of consumers like you.