The Financial Times reports that Facebook has applied for regulatory approvals - in the UK - to develop a mobile payments system that would allow it to gain access to customers' wallets.
The Wall Street Journal, following up on the story, writes that "it's long been rumored that Facebook might start a mobile-payments system. Like PayPal, Facebook could charge a commission for each transaction and collect a portion of payments, giving the company a new revenue stream beyond just advertising … A mobile payment system would also allow Facebook to gather even more personal information about people that it could use for targeted advertising, which is at the core of the company’s business. Knowing the spending habits of its customers also could allow Facebook to match purchases with ad campaigns, helping the social network prove the efficacy of its advertising. Right now, Facebook partners with third party data brokers to accomplish that goal."
The Wall Street Journal, following up on the story, writes that "it's long been rumored that Facebook might start a mobile-payments system. Like PayPal, Facebook could charge a commission for each transaction and collect a portion of payments, giving the company a new revenue stream beyond just advertising … A mobile payment system would also allow Facebook to gather even more personal information about people that it could use for targeted advertising, which is at the core of the company’s business. Knowing the spending habits of its customers also could allow Facebook to match purchases with ad campaigns, helping the social network prove the efficacy of its advertising. Right now, Facebook partners with third party data brokers to accomplish that goal."
- KC's View:
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I read this story, and the first thing I think about is the line from "Marmion," by Sir Walter Scott: Oh, what a tangled web we weave…
I'm sure this makes all sorts of sense from the Facebook perspective, for some of the same reasons that it makes sense for companies like Amazon to develop mobile payments systems that will give them a piece of other retailers' businesses.
But I have to be honest. As a consumer, this all makes me very nervous. Not "keep money under the mattress" nervous, but nervous nonetheless. This complex latticework of companies and consumer data seems like it is just screaming out for breaching and corruption.
