Zoosh Adds an Old-Time Twist to the Mobile Payments Arms Race

There's been lots of talk about mobile payments lately, and much of that involves near-field communication (NFC). Even Google admits the technology is still a few years off, although consumers are able to make at least a few transactions with their phones today.

While some consumers are still hesitant to trust their wallets to this new technology, there are other opportunities such as loyalty programs that are not only viable but also desirable.

A new technology reminiscent of your old dial-up modem is widely available today, and it's possibly more cost-effective for both merchants and the consumer. Sunnyvale, Calif.-based Narette recently introduced its service, called Zoosh, which plays an inaudible noise from your phone to conduct transactions between two phones or a phone and a merchant.

The sound is inaudible, according to an article in the Wall Street Journal. Zoosh requires a software program to be installed on the cell phone that transmits an ultrasonic sound. It works with just about any current phone. The company says roughly 100 million phones have been sold with speakers and microphones sophisticated enough to run Zoosh. This figure is likely worldwide and not just for the United States, although it's still a considerable number.

By contrast there are just 13 smartphone models worldwide available that can handle NFC transactions today, according to Near Field Communications World. Many of those handsets aren't available in the United States, and only a limited number of those seem to be Android-based --the leading U.S. smartphone OS. (Neither the iPhone nor BlackBerry is NFC-ready at this point.)

For the merchant or business looking to connect with customers using Zoosh, the cost is also cheaper. To purchase or upgrade a terminal to accept NFC transactions, the costs range from $100 to $850 per terminal. An add-on device that supports Zoosh will cost merchants about $30. It's also compatible for phone-to-phone transactions, which is a benefit for transacting on the road or at events such as trade shows and conventions.

While Zoosh is designed to handle payment transactions, loyalty programs are just one additional possibility. There's plenty of couponing options, but there's also potential for exchange of data or information. Zoosh could be used to swap virtual business cards; send sales flyers or price lists, or even supply a whole invoice for the transaction taking place.

The issue will be whether you can get your customers to install the Zoosh software. My bet is that if you build a simple app, or integrate it into your company's existing app, customers won't see it as a bother and will actually be impressed with the cool factor of paying for services or getting offers over their phones.