Mobile transactions get conditional FTC nod

The FTC stated that the development of mobile phone-based transactions is in-line with the global trend of smartphone proliferation.

A spokesperson for the commission said that the new scheme, to be operated on the Trusted Service Manager (TSM) platform, will bring exceptional convenience and improved efficiency to transaction processing and the public.

Citing precedents from abroad, the FTC stated that in order to succeed, the scheme needs to be jointly operated by major telecom carriers to achieve the economy of scale. Two previous efforts by individual carriers both fizzled.

The new venture will be jointly operated by five leading telecom carriers in addition to EasyCard Corporation (悠遊卡公司). The five carriers are Chunghwa Telecom (中華電信), Taiwan Mobile (台灣大哥大), A+ (亞太電信), Vibo (威寶電信) and FETnet (遠傳電信).

To prevent the possibility of limited or unfair competition, however, the FTC has laid out three conditions for the six companies involved in the scheme.

Three Major Stipulations

The FTC stated firstly that none of the six companies involved may have more than one-tenth of controlling interests or capital in the new venture.

Secondly, the current members of the scheme may not reject or prevent other competitors wishing to join or leave the scheme, including obstructing the acquisition or selling of shares of the new venture.

Thirdly, members of the scheme may not reject the integration of the services with other mobile transaction platforms.

Mobile phone-based transaction services will include credit card payments and EasyCard abilities for use on the Taipei MRT in addition to serving as a keycard for door access.

'Great electronic beast': Concerns Raised

The Kaohsiung City Government yesterday expressed concern about how the position of the six entrenched companies will affect the Kaohsiung Mass Rapid Transit system's hopes to join the scheme in the future.

The Consumer Protection Committee also raised questions regarding the potential consequences on users in the event of a lost or stolen mobile phone.

Opposition lawmakers and Kaohsiung Rapid Transit Corporation Chairman Hao Chien-sheng (郝建生) yesterday contested the scheme at a press conference, claiming it could monopolize over 90 percent of the electronic transaction sector.

This would pose an imminent threat to consumer rights, they said, claiming that the administration has created a “great electronic beast.”

The lawmakers argued that currently the market was segmented, with the I Pass (一卡通) and Taiwan Easy Go (台灣通) cards having 2.8 million and 2.1 million users, respectively.

Under the new scheme, an overwhelming number of the users will have their options dictated to them by a monopoly, they warned.

Legislator Lin Tai-hua (林岱樺) said that as most mobile phone subscribers hold a contract with one of these carriers, the joining of metro cards and mobile phones will deny them a proper range of options.

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