Amid the sound and fury of the debate on the rightful place of a Web browser in Microsoft’s forthcoming Windows 98, one particular piece of software set to ship with every copy of the new operating system has been almost forgotten. Smartcards, anybody?
Microsoft’s bundling of its smartcard base components with Windows 98 — providing, for example, support for the EMV (Europay Mastercard Visa) standards built into most of the world’s point-of-sale card terminals, represents a sizeable event in the development of e-commerce.
At the same time, Visa International has set sail on a strategy that could have come out of Sun CEO Scott McNealy’s dreams. If Visa has its way, and its open platform API set is broadly adopted, the operating system on a smartcard will not matter to the applications it runs. Each vendor will provide an OS and a Java VM and developers will write once to run anywhere. Visa’s rival Mastercard would like everyone to use its Multos OS, which it which it says will be programmable in Java. Everyone says it all has to converge somewhere, soon.
But if everyone is heading in the same direction, not everybody is coming from the same place. Visa’s director of emerging technology for Asia-Pacific, New Zealander Mark Cullimore, admits a different environment pertains in almost every country in his region.
In Singapore, for example, Visa has just helped launch the first Java-based “smart credit card” — but its flagship Visa Cash product has been left off in deference to the existing government e-cash scheme.
On the other hand, the decision of the issuer, Standard Chartered Bank, to include a Java-based SET (secure electronic transmission) application on its cards — the chip stores the user’s SET certificate and private keys — could be the start of something big for Internet commerce.
In New Zealand, there’s the need to carry forward the legacy of a ubiquitous Eftpos system based on some fairly old technology. In Australia, there’s a race to stay alongside Telstra, which is furiously populating the market with its proprietary cash-cards. In both countries, Visa is the market leader, but the leading banks are equity holders in the Mastercard-controlled Mondex e-cash system.
“That’s life,” acknowledges Cullimore. “You do have to have a different strategy everywhere, to an extent. If you look around Asia, there are magnetic stripe markets, there are some chip terminals, and in some markets there’s nothing. But there are two major issues. One is on the card side and the other is infrastructure.
“There are key industries for us to work with in each country — telephone companies and transit operators are our first targets and we’re doing a lot of work with them.”
In getting its first Java-based smartcard to market, Visa also showed off the Open Platform API set the card uses, and which it is offering to all takers in search of an industry standard. This month it will do the same for the terminal end of the Open Platform offering, by releasing specifications and APIs. “What we have standardised in those specifications is everything that relates to chip-cards,” says Rodolphe Chabanel, Asia-Pacific director for Open Platform. “We are not standardising displays, keypads or anything else, because that’s competitive between vendors.”
Chabanel says the terminal APIs will be accompanied by development toolkits created by Visa. “The goal we see by the end of this year is somebody at the PC saying, okay, now I want an application. And they’ll be able to write their applications using object-oriented programming, at a fairly high level, on the PC. The workbench we provide will automatically generate the code for the card and the terminal.”
Cullimore agrees the advent of a SET application on Visa chip-cards should provide momentum for the slow-growing e-commerce standard — especially in conjunction with smartcard-capable PCs.
“Something like SET has to be easy for the consumer, as well as secure. You have to be able to say, don’t worry, just put your card in, enter your PIN or password and away you go. We’re going to have a little bit of a rough patch with SET while people have to learn to download wallets and remember to get their certificates and things like that.
Now, Visa must concentrate on the more mundane matter of working with its issuing banks in places like New Zealand, and reaching solutions that suit its partners too.
Although two Australian banks, Westpac Australia and Commonwealth Bank (both Mondex consortium members), have already joined Visa’s Open Platform users’ group, none from New Zealand seem set to any time soon. Westpac New Zealand will, however, participate in the Visa Cash joint venture with the city council agency Partnership Wellington.
“We’re actively working towards a single [chip-card] platform for those banks,” says Cullimore. “The last thing the New Zealand and Australian banks want is us to say they have to run separate platforms.”
Visa has already taken Open Platform to vendors and operators in the industry which uses by far the bulk of the world’s smartcards — GSM telephony. Chabanel says the GSM industry “may not actually load any Visa application into it, just their own applications, but they have taken on the platform”.