Competition Aspects of New Mobile Payment Networks: The Case of Mobile Payments in Spain

This note by Ignacio Mas reviews the Spanish experience with regulating the competition aspects of new mobile payment networks in the absence of formal technical standards. The saga is in two parts, as the strategy of the early movers, dominant telco Telefonica and leading bank BBVA, changed radically in mid-course. At first, they sought to create an industry platform where they tightly controlled the technical standards and delivery platform. Then they moved to a scheme where there was common industry ownership of the technical platform. As a result, they found themselves having to go to the competition authority twice: once to justify how their private agreement wasn’t going to shut out other players, and the second time to justify why their joint agreement with all other major industry players wasn’t going to have an anti-competitive impact.