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Passwords out, new mobile ID methods taking off

08 Dec 2015

Data theft is continuing to spur on the mobile identification market, and will generate an additional $700 million for mobile network operators by 2020, according to a new study from Juniper Research.

In comparison, mobile operators have generated just $20 million from new universal log-in and mobile identity services this year.

This increase is largely due to the fact that online engagement has soared and the limitations of a password-based approach becoming increasingly exposed, the research shows.

With people using the same password for multiple sites the scale of data theft has risen dramatically, Juniper says.

In fact, 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 has dramatically eroded confidence in such sites.

Enabling new mobile ID methods

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, the research shows.

Dr Windsor Holden, author of the study, says, “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 the biggest obstacle

However, the research claims that the business case for mobile ID solutions had yet to be fully established.

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

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