Secure socket layer (SSL). Though it's a security protocol rather than a payment scheme, SSL offers an excellent benchmark for standards adoption. SSL gained acceptance (despite competition from other security approaches) by being seamlessly integrated into the browser by technology vendors; consumer penetration, in turn, drove adoption by online merchants (and other Web sites). In conjunction with verification resources built into the credit card network (shipping address, expiration date), SSL's "good enough" protection slows the adoption of more evolved standards.

Secure electronic transaction (SET). In addition to encryption, SET offers trusted-source verification of the parties to a transaction, via a certificate issuance and management system. However, SET holds little appeal for merchants or consumers (although Microsoft's SET-compliant software, which is built into current editions of Internet Explorer, will increase consumer adoption. Though support from technology vendors and card associations guarantees pockets of adoption in the US and especially overseas, SET is most instructive as a failure: No wallet standard can gain broad acceptance among merchants and consumers without using at least one of the two groups as a leverage point to drive adoption.

Open trading protocol (OTP). OTP, currently in development, proposes a meta-architecture that will encompass a variety of payment protocols: server- or client-based, with or without certification, using credit, debit, or cash payments. OTP faces the same adoption challenges as closed counterparts such as SET, but with one key difference: Because it is XML-based, OTP should gain an adoption edge among both consumers and Web sites as browsers and sites make the shift to XML over the next three years. However, Jupiter emphasizes the fact that merchants, banks, and wallet vendors will continue to face the challenge of standardizing document types for exchanging transaction information—XML merely guarantees a common framework for deploying such formats.

Back