Bluetooth chip prices scare off banks

Bluetooth chip prices scare off banks

Bluetooth, the wireless technology specification for linking computer devices using radio waves, is unlikely to reach the mass market until 2002 because of high chip prices, according to new research from Boston-based Meridien Research.

The price of the Bluetooth chip, currently around $27, must fall to the $10 to $15 dollar range before it will be widely purchased by manufacturers and consumers, say Meridien analysts Randi Purchia and Jennifer Schmidt. "Based on our analysis, we don't think the chips will be that cheap anytime soon," Schmidt says.

MeritaNordenbanken, the largest Nordic banking group, with more than 6.5 million retail customers in Sweden and Finland, is planning a Bluetooth pilot in 2001 and is currently in talks with Nokia to see what can be done with payments through mobile phones.

The bank plans to pilot two applications next year: remote payments and a point-of-sale terminal. With the latter, the phone will communicate with the terminal initiating the sale, and customers will be able to pay for goods. Additionally, two individuals who both have Bluetooth devices will be able to conduct person-to-person payments with one another.

"MeritaNordenbanken is the first financial institution we've found with concrete plans to adopt the Bluetooth technology," Schmidt says.

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