SBIR Phase I: Secure SMS Transactions for Transit Systems and Mobile Markets

This Small Business Innovation Research (SBIR) Phase I project will determine the feasibility of using secure text messages (short messaging service, SMS) for mobile commerce. Mobile commerce - payment and messaging done via a mobile device such as a smartphone - is technically challenging because of the competing requirements of security, ease of use, and cost to implement. For mass market adoption, transaction speed plays an additional, important role. While mobile devices have tremendous computational power, the challenge is to provide adequate security at sufficient speed in an application that is convenient and usable. Costs, such as application costs, infrastructure costs, and payment clearing system costs are also important for adoption. There are three aspects of SMS-based mobile commerce technology that Hermes Commerce, Inc. will assess in this Phase I research project. First, Hermes will assess the security-speed-usability trade-offs of a secure SMS application. Second, system infrastructure will be evaluated for technical, deployment, and cost considerations. Last, Hermes will evaluate security-speed benefits that might be realized through the transaction clearing system. If successful, this project will have a broad impact by enabling mobile commerce. Competing mobile commerce technologies include: Smartcards, Near Field Communication-enabled cell phones, and Radio Frequency ID-enabled payment cards. All of these face the challenge of getting customers or equipment manufacturers to implement hardware retroactively in existing devices or design and sell new devices. The company?s secure SMS solution requires very little change by the end user ? only an application downloaded to the mobile device. The simplicity of the approach has the potential to drive wide-spread adoption.