Figure 1. Turkcell Cep-T Cüzdan
• New revenue streams. The Cep-T Cüzdan service has the potential to create new revenue streams from existing customers, as well as increase the subscriber base and build loyalty.
• International expansion and licensing. Turkcell has interests in a large number of operators outside of Turkey and could extend its mobile payments platform to these operators going forward.
• Strong base of contactless Point of Sale (PoS) infrastructure. Turkey has 66,000 contactless terminals currently installed. PoS terminal issuers and banks plan to convert two million existing PoS terminals to support contactless payments.
• Improved device manufacturer support for NFC handsets, strengthening the prospects for NFC-based consumer services. In Q4 2011 alone, 17 percent of all smartphones shipped globally were NFC enabled, compared to under 4 percent in Q12011 (source: Ovum.)
• Turkcell will need to focus on increasing usage as consumer adoption of mobile payments is still modest.
• Turkcell's expansion into mobile marketing services requires modifications to most PoS terminals to support nonpayment applications such as coupons, necessitating further investments by merchants.
• Although Turkcell has made good progress in building the installed base of NFC phones that support Cep-T Cüzdan (300,000 as of March 2012), the number of devices must continue to grow because scale is critical to the success of mobile payment services.
• Turkcell was first to market with Cep-T Cüzdan, but Vodafone Turkey is also expected to launch a NFC-enabled mobile wallet service. Turkey's third mobile operator, Avea, launched a NFC-based service using a bridging application in 2010.
• Turkcell launched its mobile wallet service without the collaboration of other operators in Turkey. Partnerships may be complicated, but in a solo operator strategy, Turkcell carries all the risks. Collaborating with other operators would help lower exposure and build support for scaling.
• MasterCard is Turkcell's credit card brand and payment acceptance network partner, via MasterCard PayPass.
• Current banking partners include Turkey's three leading banks: Yapı Kredi, Garanti, and Akbank. Several others are expected to support Cep-T Cüzdan going forward.
• Hardware and software vendor partnerships are also instrumental in enabling the mobile wallet solution.
• As of March 2012, Turkcell had 300,000 customers with Cep-T Cüzdan enabled NFC phones, of which 50,000 are active users of the mobile wallet service.
• Turkcell views its mobile wallet service as an opportunity to drive new revenues not only from a share of payment transactions but also from associated mobile marketing applications including rewards, promotions, and coupons (it has not yet released figures).
• Turkcell has deployed an SIM rental model, charging a monthly fee to banking and other partners for hosting applications on secure SIM cards. The service is free to consumers.
• Turkcell is expected to derive further revenue benefits by expanding the mobile wallet service to operators in which it has a majority stake, such as Astelit in the Ukraine and BeST Belarus. Turkcell could also license the platform to other operators.
Case study source: Cisco sponsored research developed by Ovum.