The mall made mobile

Yahoo sneaks up on m-commerce with shopping, payment via wireless If anything can excite wireless service providers more than the mobile Internet, it's applications that use the mobile Internet to further e-commerce. So far, those apps have been limited to simple "pull" functions such as e-trading. But two weeks ago Internet portal Yahoo rolled out a suite of products - one specific to the mobile phone and one with applications for either cell phones or PCs - that could grow into real mobile commerce, or m-commerce, enablers - if the public decides that it needs them.

One of the most popular forms of e-commerce are auctions, from eBay or one of the other well-attended online houses. But these auctions pose a payment problem. If you're buying from a private individual or a relatively small business, you usually can't use a credit card because the seller has no way to clear your purchase. So you either use a money order (inconvenient effort) or mail a check and wait for it to clear (inconvenient delay).

Through its Yahoo Everywhere mobility initiative,Yahoo introduced Yahoo PayDirect, a service that allows users to send and collect money online or over an Internet-enabled mobile phone. The service operates through accounts with a Yahoo partner, CIBC National Bank. Users set up an account online and link that account to a bank account or a credit card. Using a PC or an Internet-enabled wireless phone, the user then can transfer money to an account that will be set up for another party. CIBC authenticates and clears the transfer; the payee is notified by e-mail that the money is waiting and is given a URL for the PayDirect site, where a quick registration will make that account active and available.

Yahoo will watch to see how well the PayDirect system spreads beyond the online auction world, said Christopher Wu, a producer of m-commerce applications with the Yahoo Everywhere group. "Say you're out to dinner with a group and one person pays for the meal," he said."You can just take out your Internet cell phone, dial in to the PayDirect site, give your password and transfer $10.99 to that person's PayDirect account." Although PayDirect can forward payments to a bank account or issue a check, Yahoo hopes that the recipient will leave those funds in his own PayDirect account for future m-commerce payments.

Another product in the Yahoo suite is a more intermediate step to true, phone-based m-commerce - specifically to locationbased functions. Using Yahoo Local Sales, mobile phone patrons can browse advertised offline sales in their neighborhood, categorized by item, brand name or store. The service is supported by ShoppingList.com, a geographically targeted marketing platform that maintains a continuously updated database of sales promotions and inventories at 140,000 local retail stores nationwide, designed to drive online traffic to local retailers.

"When we think of m-commerce, we think of not only enabling the transaction but of the process leading up to it - including finding the information that leads up to a transaction," Wu said. "Yahoo Local Sales leads not only to a transaction that you conduct over the phone but to one in the real bricksand- mortar world."

Instead of scouring the mall with scraps of ads ripped from the Sunday papers, shoppers can dial into Yahoo Local Sales on their cell phones, enter their current ZIP code, select "products" and scroll down a list to "jeans" to find out that the Gap at the other end of the mall is selling denim cargo pants for $24.99. Another click can produce driving directions to the store.

If they see respectable take-up rates among the public, these Yahoo products could lead to more tightly integrated m-commerce functions. "Yahoo Local Sales could combine its registered users with a location-based m-commerce service pretty easily, once wireless phones are commonly equipped with locator devices to pinpoint where their users are," said David Pecaut, an e-commerce analyst for The Boston Consulting Group."PayDirect is a bit more problematic. It could solve the problem of clearing and authenticating payments among individuals via wireless. But its acceptance will depend on wide penetration beyond the usual auction crowd, and that's probably a few years off - if it arrives at all."