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Consumers cut the fat from digital wallets





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Consumers cut the fat from digital wallets

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RESPONDING TO WEAK consumer demand for bandwidth intensive e-commerce with “fat clients”, vendors are lightening the load on digital wallets and moving away from the controversial Secure Electronic Transactions (SET) standard.

Microsoft has abandoned its client-side wallet application, and dropped support for SET, in favour of a server-based solution to authenticating Web buyers which is integrated with its Hotmail free email service.

Meanwhile, its competitors in the e-commerce merchant server space, IBM and Creative Digital Technology, are taking an each way bet with “fat” wallets which are necessary to keep the SET infrastructure safe, but they are also including the option to change to less secure but more workable transaction security.

Harvey Sanchez, senior marketing manager at Microsoft’s consumer and commerce group, said the company’s new Passport service was built on its failed experiences with client-side wallet software. The previous product, which had been at its fourth version, had been machine-specific and only available through the Internet Explorer browser.

“We know that for consumers, a digital wallet is difficult to adopt, so we are moving to a server-side wallet,” said Mr Sanchez.

Passport is completely server based and available through both version 3 browsers, providing a “single sign on” where users can type in their Hotmail username and password to authenticate their identity at participating sites. Merchants pay an annual fee of between $780 (US$500) and $31,250 (US$20,000) depending on their traffic levels.

Mr Sanchez confirmed that Passport was not SET-compliant, but said that Microsoft was “currently evaluating it for version 2 of the Passport service.”

He said Passport was the first in a number of “megaservices” which e-commerce providers would be able to tie together to enable rich content, like an “impulse buying banner” which would automatically deliver personal details to an online buying form when a user performed a clickthrough.

“Consumers will be more engaged and they will be able to do more. The process for buying on the Web now is cumbersome and hard, especially for consumers,” he said.

Australian e-commerce vendor Creative Digital Technology used the Sydney Internet World 99 show in August to launch ActiveWallet, which will compete directly with IBM’s product with similar features like Electronic Commerce Markup Language (ECML) support and SET certification.

Bahram Boutorabi, CEO of CDT, said when the product was launched under two credit card vendors’ brands next year, consumers would be able to choose a Webserver-based solution, or a 750KB downloadable client which would enable extra services like electronic bill payments.

“While the wallet might sit on the client, their information sits on the server. We’ve taken the approach of not forcing people to use one or the other server-or client-based solutions,” he said.

Mr Boutorabi questioned Microsoft’s message that Passport would mean a “single sign on” to multiple sites, saying that consumers would have to maintain Hotmail accounts in addition to their normal ISP email.

“We cannot trust Microsoft on privacy. That’s a full stop from my point of view. If I had personal details to send, I wouldn’t send them to Microsoft,” he said.



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