Sybase Blog – Diarmuid Mallon

Part 2: Applications didn’t deliver, what now?
Unfortunately, applications did not deliver. Yes, they were secure. Yes, they had a rich UI. Yes, they supported wide range of functionality. And yes, they looked great. But, and it is a big but, they did not achieve any significant uptake.

Banks struggled to get even a few percentage of their account holders to make use of mobile application for banking, and one bank specifically I know, took a whole year to reach 1,000 downloads.

Surprisingly, this low uptake trend was not just in nascent mobile banking markets such as the US, but also happening in mature mobile banking markets in Europe and Asia. So, what were the challenges with Applications and why were they failing?

Reasons were numerous, but a really significant challenge was getting Applications onto mobile devices. At the time there were two approaches to accomplish this, neither of which were easy or cost-effective.

This first approach is relying on consumers to self-install the rich Applications on their mobile device. As any one who has tried to install anything on to their cellphones knows this process is less than straight-forward – it is complex with multiple confusing steps and once the Application is installed on the mobile phone it is filed in a random location. For example, on one phone it might be in the ‘Applications’ folder, another ‘Installs’ and some confusingly in ‘Games’.

The second approach is to pre-install applications on mobile devices prior to shipping to retailers, which require a personalization process, where channel specific modifications such as configuration or installed applications are made. The problem this approach caused is in any given market there is the lack of a single personalization center, at the very least, there will be one per carrier. Major retailers, such as CPW or Best Buy have their own personalization centers as well. So it was no surprise, Banks that went this route ended up with fragmented, single carrier Applications, thus limiting their accessibility.

The problem is even if Banks could get all of the personilization centers to install your application, a bigger problem is that your customers will need to buy a new mobile phone (and perhaps also change carrier) to get your mobile banking application. So how often do people change mobile handsets? Well not as often as you might think. In the US, about 20% of the mobile subscribers change handsets in any given year.

Another challenge was the sheer number of handsets in any market. There are thousands of handsets out there, and some are specific to particular carrier. There are also wide range of handset platforms to support: J2ME, BREW, Windows Mobile, Symbian S40/S60, Blackberry, Palm, iPhone, ….

Getting the right application installed was only one problem. Not only does the consumer need a data-plan to use the application, but if their phone is not correctly configured, then they customer service support to configure their handset.

Then of course, you need to issue activation codes and (mobile) PINs, which may be sent the traditional route via PIN mailers. Finally you need a mechanism for dealing with lost handset, software upgrades and lost PINs.

Clearly a different approach was needed.