In August 2006, we published a report called "Mobile Payment in China: Bricks and Clicks Going Mobile?". In this report, we analyzed several mobile companies in China, including a company in Beijing called Nation-M. Just recently, we had trouble opening their website and had trouble getting through to their office. We even tried to contact Nation-M's founder via his direct line, but that number has been canceled by the telephone company already.
Does this mean that Nation-M has gone under? Could this be the beginning of a market consolidation phase in China's m-payment industry? We decided to explore further into this situation to see what we could dig up.
In August 2006, we published a report called Mobile Payment in China: Bricks and Clicks Going Mobile?. In this report, we analyzed several mobile companies in China, including a company in Beijing called Nation-M. Just recently, we had trouble opening their website and had trouble getting through to their office. We even tried to contact Nation-M's founder via his direct line, but that number has been canceled by the telephone company already.
Does this mean that Nation-M has gone under? Could this be the beginning of a market consolidation phase in China's m-payment industry? We decided to explore further into this situation to see what we could dig up.
On Sina.com's blogsite, we found a post from someone who claims to be a former employee of Nation-M (unfortunately, the post has since been removed by Sina for undisclosed reasons). This person wrote that the company formerly known as Nation-M owes him a welfare payment, and when he went to their office to collect, he found that the office had been abandoned. According to the post, the office door was closed and the office phone was disconnected. He also tried to contact Nation-M employees directly as well, but failed.
By the power of deduction, it may seem that Nation-M has already gone out of business?
From talking to our other contacts in the market, we believe that Nation-M may have been one of the victims of new government regulations banning the online sale of lottery tickets, which happened to be one of Nation-M's more popular services. It is also highly possible that Nation-M, which has been unprofitable (like most other m-payment companies in China), may simply have just run out of operating capital.
With over 30 m-payment companies operating in China today, we expect to see many more cases of m-payment companies going out of business and/or merging with other companies over the next few years. Sooner or later, investor capital will run dry in the m-payment sector which will further force market consolidation. While this is certainly not good news for some of the smaller m-payment players, this may turn out to be an opportune time for larger domestic players and even international payment providers to enter the Chinese market, bringing with them proven technology, a global network, and perhaps most importantly financial reinforcements!
Comments