NEW RESEARCH: Monitise's Strategy: Standing the test?

Throughout 2014, Monitise has undergone significant change as it embarked on a new business model ("Monitise 2.0"), announced at the end of March as a way of accelerating its "land-grab" and establishing itself as the pre-eminent facilitator of banking, payment and transaction services over mobile devices.

We highlighted Monitise in our report "Finding the Winners in UK payments", and we now have the opportunity to take stock of the company’s strategy and comment on its outlook. The company is certainly doing many of the right things to succeed and has the cash to pursue its ambition, but it is clear that this strategy is not without risk and that the test that Monitise management has set itself will continue for some time.

With the massive advance in mobile usage and the growing acceptability of mobile commerce and mobile banking the growth dynamic underpinning this approach is already clear, but the success of Monitise will depend upon the answers to the following 4 questions;

• Will banks and other companies trust Monitise with a key component of future growth?
• Will the network effect generate sufficient benefit to reward Monitise (and its shareholders)?
• Will competition fragment the market and keep prices low?, and most importantly
• Can Monitise make money?

Monitise management is doing many of the right things to succeed, but the company needs to build and exploit scale to enable its model to drive real value for the banks, retailers and content providers to generate additional business as end-customers use their mobiles more and more. The report is available to FinancialServicesViews and Foundation Service customers here - if you are interested in subscribing, please contact Deb Seth of our Client Services team.

Posted by Peter Roe at '17:11' - Tagged: mobility   analytics   bigdata   payments   banking