CyberCash moves to thin wallet
The creator of the first wallet software for making purchases on the Web announces that it will forsake that bulky software for a new technology.
CyberCash will now promote a technology called InstaBuy, a one-click purchasing mechanism for Web consumers built on its Agile Wallet software.
With InstaBuy, CyberCash hopes to make online shopping easier by having a consumer enter credit card data once, store it centrally (initially with CyberCash, but eventually with a card-issuing bank), and let the consumer use the card at any participating Web merchant.
"For consumers, it means ease of use and security," said Maureen Loftus, CyberCash senior vice president. "For merchants, it means more revenue and transactions. Banks can leverage their brand onto the Internet, and they want to retain their customer."
Loftus cited studies that indicate that 20 to 50 percent of consumers who put items in a "shopping basket" on a Web storefront don't complete the purchases, largely because checking out and paying is too long or complicated.
"They're halfway there--it looks like they've moved the wallet off the client to the server," said Vernon Keenan of Keenan Vision, an e-commerce consultancy. "Code-based wallets on a client [device] are a complete failure."
CyberCash is not the first to announce a server-based wallet--GlobeSet's Server Wallet is designed for credit card transactions under the Secure Electronic Transactions protocol, and it has created a stir among SET developers.
CyberCash hopes InstaBuy will boost online transactions in the upcoming holiday shopping season by making purchases easier. But to do that, it must sign up both banks--whose brand will appear on the InstaBuy wallet to boost consumer trust--and merchants. Loftus's goal: Two major card issuers and a third of the top 100 shopping Web sites when the program goes live in October.
Web storefronts now testing InstaBuy include Musicmaker, Martial Arts and Fitness Network, Greentyre, PrimeLinx URL Plates, and DMC Diversified Merchandising Company.
InstaBuy is the first plug-in for CyberCash's new Agile Wallet, which will be enhanced to add other forms of payment--including CyberCash's own e-cash called CyberCoin, and its electronic check offering called PayNow.
Agile Wallet also will accommodate loyalty and incentive programs, some of which will be available for the fall holiday shopping season, Loftus said
But some analysts raise doubts about CyberCash's ability to deliver on the promise of InstaBuy, in part because the company has suffered big losses because Internet transactions have taken off more slowly than anticipated.
Keenan, for example, thinks merchant fees are too hefty.
Jack Staff of Zona Research worries that consumers may not want to store their payment data on the Net, even with their bank. He also wonders whether launching the program in October is soon enough to affect this fall's holiday shopping season.
But Loftus says it plans to move its half million or so CyberCash Wallet users to the new wallet by year's end, using a Web site where payment information will be transferred to a new wallet.