042 043 VIEWPOINTS Payments and the Internet of Things: How Will This Space Mature? data, which we can liken to merchants displaying their goods online in virtual retail shops. Finally, the IoT devices will By Avin Arumugam become commerce portals, offering SVP, Internet of Things, Visa items for sale with secure payments, similar to the development and IoT will likely follow the flourishing of e-commerce on the web. same evolutionary path Where the trend deviates from Web 1.0 is that IoT foretells a shift from as e-commerce. software to hardware. Because the physical functionality of the device— a watch, a car, a fridge—is crucial, we will see a new influx of engineering and design talent in hardware. Yet the consumer experience will be the priority, rather than the aesthetic The payments world is still trying comes to implementing payments. appeal of the object. For instance, the to understand IoT—that growing That's because consumers have to be .8 connected car is quickly becoming the network of objects able to collect and ready, which takes more time than new mobile phone, as vehicles evolve share data via embedded sensors. simply rolling out new technologies. 20 into platforms for entertainment, According to Gartner, IoT holds the commerce, and socialization. Car promise to make our lives better and Yet manufacturers who are rapidly shows are now more about what taking advantage of this new time that payments to IBM Watson’s IoT platform, innovating in this space cannot be billion connected devices are will enable the consumer to engage which will allow businesses to connect more convenient, with 20.8 billion projected to be online by 2020. drivers experience inside the chassis connected devices projected to be ignored. They too are struggling to than what the vehicle looks like with brands while riding along. Great to billions of connected devices, online by 2020. refine their communication strategies whizzing down the freeway. payment integration will be essential. sensors, and systems around the world and better explain the value of And as less housework is required and then draw actionable insights. After a period of adoption of these implementing IoT to consumers, and We’ve traveled a similar road before in When we project ahead to the rise in the connected home, there will IoT devices in their lives, consumers payment companies must be there to the adoption of the Internet. IoT will of autonomous vehicles, we can be similar opportunities to present For payment companies, IoT presents will then get comfortable enough help. Furthermore, how the payment likely follow the same evolutionary see how the car will pivot from a seamless retail payment options to new opportunities for collaborations, that they will begin making purchases happens is important. In some cases, path as e-commerce. In the first stage, formerly stressful driving console help consumers make purchases from and traversing some learning curves through them. But for this to happen the consumer needs to be aware devices will become connected, which into a roving lounge. We will be able various household devices. as we experiment with diverse new successfully, the payments industry and authorize each transaction. But is analogous to the initial days of users to truly live our lives inside the car, partners in lifestyle and hardware will need to be customer-centric rather payment could also be invisible or in going online in the late 1990s. Then, free from navigation and operation. For example, Visa recently announced manufacturing. than manufacturer-focused when it the background. devices will collect and manipulate Commercial opportunities abound for a partnership with IBM to bring digital