Rumours emerge of Facebook smartphone project

The smartphone industry is set to become more competitive than ever, with reports emerging that social media giants Facebook are planning to enter the market.

Less than a month after its disappointing initial public offering – which saw a 16.5 per cent decline in stock prices over the first week of trading – the New York Times has released a report speculating that Mark Zuckerberg’s company is hiring former Apple engineers with hopes to design a Facebook smartphone.

Facebook is reportedly optimistic that the phone will be released next year, which will mean further competition for the popular Apple iPhone and Samsung Galaxy products.

With so many smartphones now available, more consumers are likely to begin experimenting with new forms of mobile payment technology.

Forward thinking businesses will need to examine the mobile payment options they offer, while at the same time making sure online retail services are secure and private.

The Payment Card Industry Data Security Standard (PCI DSS) is a required certification for all retailers dealing with credit and debit card transactions and seeks to assure that consumer information is correctly managed.

The PCI Security Standards Council participated in a congressional subcommittee hearing on mobile payment acceptance security in March, where it announced plans to introduce new guidelines for mobile security requirements and encryption technology.

Reaction to the Facebook smartphone has been mixed, with some experts speculating that the company does not have the industry knowledge to correctly design a competitive product.

Others have indicated that the move may be a necessary step in the continued expansion of Zuckerberg’s empire.

Facebook is yet to confirm or deny the reports, instead directing reporters to a statement made last year to technology website AllThingsD, where it claimed to be “working across the entire mobile industry; with operators, hardware manufacturers, OS providers, and application developers.”

PCI DSS for paying by smartphone

With the payment card industry (PCI) becoming more interested in digital wallets additional focus is being paid as to how secure these financial products need to be.
One of the most obvious avenues for personal and business transaction is through smartphones – with growing numbers entering the eager hands of consumers every year.

According to MasterCard Australia’s head of innovation Matt Bar, this is the way the PCI industry is heading with speed.

Mr Bar told the Australian Financial Review on May 8: “The technology is there but it comes down to commercial discussions around how those services get set up.”

PCI compliance fears also need to be addressed, according to the Commonwealth Bank’s general manager of cards and payments David Lindberg, who described smartphones as being the “dominant channel” for banking transactions.

“In many ways, a phone is more secure than a piece of plastic in your wallet because you need pin numbers to get to information and, if you lose it, that information can be remotely wiped,” explained Mr Barr.

“We are confident that mobile improves the security of?the payments industry and the convenience will make it pretty compelling.”