Data Theft Concerns Spur Mobile ID Market

A new study from Juniper Research claims that Mobile Network Operators will generate an additional $700m annually by 2020 from new universal log-in and mobile identity services – from a base of just $20 million this year.

The new research – Mobile Identity, Authentication & Tokenisation 2015-2020, found that as online engagement has soared, the limitations of a password-based approach are being increasingly exposed. With consumers using the same password for multiple sites, and the scale of data theft has risen dramatically.

The research estimates that the number of data breaches worldwide is expected to rise from just under 6,000 this year to more than 16,000 by 2020, with an average of 500,000 records exposed per breach. Meanwhile, high-profile data breaches such as that experienced by Ashley Madison had dramatically eroded consumer confidence in those sites.

Diminishing Fraud Risk

The Juniper study argued that approaches such as that endorsed by the GSMA’s Mobile Connect initiative, which seeks to deliver a secure universal solution would be far more effective. Using this approach, the user logs in via a mobile number and a single PIN. Not only did this diminish the risk of fraud, but also offered potential benefits such as greater customer conversion rates and reduced call centre costs.

According to research author Dr Windsor Holden, ‘It is imperative to reduce online user pain points: enabling a single, secure mode of entry could be a key development in this regard.’

Business Case Remains a Challenge

However, the research claimed that the business case for mobile ID solutions had yet to be fully established. It pointed out that the problem facing operators opting for a subscription-based approach is that even a low level charge ($1.00 per month) can represent a relatively substantial uplift in consumer spend.

It also stressed that for a mobile ID service to be successful, it would be essential for all network operators within a given market to be signed up to the scheme, thereby ensuring universal availability.