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Cellphones quickly becoming wallets

These days, most people won't go anywhere without their cellphones, and NTT DoCoMo is looking to profit from this


A special reader attached to one of the machines at an arcade lights blink as it recognizes NTT DoCoMo's new wallet phone, the P506iC, in Tokyo on July 16. By putting the mobile phone to the card reader, you can start playing the video game. The wallet cellphone is the first to use a tiny computer chip embedded inside, similar to the smart cards that are used in subways throughout the world. Japan's NTT DoCoMo is expanding the services and items that can be purchased using the phone, which can already be used at convenience stores, vending machines and some restaurants.


As it is, you don't leave home without it. In a world of cashless payment, why not simply make your cellphone a wallet?

Japan has long been phasing out the hassle of coins and bills with microchip-laden "smart cards," which let people make electronic payments for everything from lunch to the daily commute.

But even smart cards could be on their way out, their plastic presence overtaken by virtual-wallet technology now available in the everyday cell phone.

Other nations, led by South Korea, already have so-called mobile commerce payment schemes in place that let people punch keys on their cell phones so that the devices trigger transactions.

But a series of phones going on sale this summer in Japan, for use on NTT DoCoMo's wireless network, are the world's first with an embedded computer chip that you can fill up with electronic cash.

The wireless company loaned me a P506iC handset from Matsushita Electric Industrial Co and I was in business. Well, almost.

First I had to find a machine that's used to stoke smart cards with cash. They can be found in some convenience stores and offices in Japan. You place the phone in a special spot in the machine and slip bills into it. The phones have a ?50,000 (US$450) limit.

Now you can spend.

To pay you simply wave your cellphone within a few centimeters of a special display found in stores, restaurants and vending machines around Japan. A fairy-like tinkling sound means your purchase is being deducted from the embedded chip using radio-frequency ID technology.

It's instantaneous.


Unlike infrared or other mobile payment schemes that require clicks on the handset, you don't even need to open your clamshell-shaped phone, the style of choice here.

It's rather fun to pay for things this way.

It's also an idea that makes sense, given that almost every Japanese has a cellphone and relies on it for so much information that being stranded in the street without one almost causes panic. There are 81.5 million cellphones in this nation of 127 million people.

For the wallet phone tech to really take off, stores, theaters and restaurants that accept electronic payments need to become more widespread. They total around 9,000 in Japan so far, but the number is quickly growing.

To buy a diet Pepsi from a vending machine, I pushed a button on the machine that indicates electronic payment and pushed another button to pick the soda. When a display the size of a small greeting card lit up with the price, I put my phone next to the display.

Shazaam. The soda pop rolled out, and the display blinked with the amount of money left in the phone.

To pay for my fried-rice lunch at a restaurant in our office building, I brought my bill to the register and told the clerk I wanted to pay electronically. When he rang it up, the little display lit up with the price at the counter. I just flashed my phone.

I also played Virtua Fighter arcade games at one of the two Sega amusement centers in Japan where the phone payments work. And I bought gum and bottled tea at a convenience store with the phone.


Like millions of other Japanese, I have a few smart cards. One, the Suica, works as my commuter train pass. The other, an Edy card, works as a wallet at some stores and its "cash" machines are the ones NTT DoCoMo uses for its phones.

I carry my Suica practically every day. But I don't always remember my Edy. So the P506iC wallet phone was handy, indeed. After all, what professional is without a cellphone these days?

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