The phone number is quite a useful identity, most internet-based communication services like Whatsapp use the telephone number identity today because it also provides a handy multi factor authentication capability. Put simply, you possess something (e.g. a mobile phone #), you know something (e.g. a password), and the emerging one of inherence (unique things of the person such as finger print or voice print). We’ve seen much activity in the past year on using the phone number in multi-factor authentication as finally services start to understand the century’s old username/password paradigm is broken:
- Nexmo announced its Verify and Number Insight services at TADSummit;
- Twilio acquired Authy. Authy is a cool service, a closed source iOS and Android client for time-based one time passwords;
- Telesign raised $40M last year, and focuses on mobile identity services using the mobile phone number.; and
- There are many other providers of such mobile phone number based authentication services such as Google Authenticator.
The mobile phone number also has amazing reach, as discussed in my review of the company Textizen, SMS has a reach and response rate far greater than any other communications platform, over 90% reach of Americans. Services such as Uber and Airbnb have led the way in showing how using the phone number can dramatically accelerate business processes, in fact creating new businesses where once the friction was to great.
The phone number is an audit-able and verifiable identity, in some countries this is essential for financial transactions. It can be used for:
- Strong authentication (2-factor via mobile handset + PIN);
- Strong security (SIM storage + WPKI + secure channel);
- Identity proofing and validated attributes (e.g. age);
- Value-added APIs/services (e.g., charge to bill); and
- Let’s not forget retail presence and customer care – when there’s a problem many people need to talk to people.
The usefulness of the phone number beyond communications is only just starting to be realized. As discussed in this recent weblog, Shango Review: Setting Telephony Free, they realized this emerging importance early on, particularly because its an identity linked to a way to pay. Shango have set the telephone number free by linking it to new communication and web-based services. Their value comes from providing BOTH the services through their service partners AND the glue between services on the web and in the telco’s network. With the necessary adaptors to the network, business support systems, and myTelco app. Its an interesting proposition that I think can achieve rapid adoption over the next couple of years if Telcos focus on action rather than inaction in this important emerging category.
There are many other identities that can and should be used, the phone number is just one and has some unique features that mean the importance of the phone number beyond the call is only just starting to be realized.
Great article Alan – incisive and insightful. Mobile Operators have not really exploited the potential of the phone number to bring new services to market. They are in danger of losing having this relationship exploited by Internet Companies.