The digital wallet will be the biggest instrument of personal agency since the browser—but only if we make it ours
Apple and Google already have a wallet in your phone. Other developers want an open way to build alternatives. But the missing player in this is us. Let's step up.
Nothing we carry is more personal than our wallets. We might change our hair or our clothes, but our wallets persist, like parts of our bodies.
And now, so do our phones. We carry those everywhere too.
But there is an important difference: our wallets are ours; our phones are not.
Not completely. Because every Apple and Android phone is also controlled by Apple and Google, two companies who operate the largest private walled gardens in the digital world. So, your digital life is at least partly lived inside those gardens.
For some perspective, ask this question: How much privacy do you have inside Apple’s and Google’s castles? Regardless of the answer (and all of those are arguable), it’s no more than they give you.
Apple and Google already have wallets ready for you, in your Apple or Android phone. That’s where they want you to carry your digital driver’s license, transit cards, event tickets, car keys, loyalty and membership cards, and vaccination records. Toward that plan, both companies are also downstream with contactless payments. But they’re behind on the rest of it.
For example, I have transit cards for London, New York, and Boston; but Apple’s wallet in my iPhone works with none of those. I have a California driver’s license, but Apple is only ready for Arizona and Maryland. For tickets, my Apple wallet tells me I have two expired boarding passes for United Airlines, but what good are those? Neither of our cars (a two-year-old Camry and a seventeen-year-old Subaru) contemplates starting up from a wallet. Adding loyalty and membership cards to these wallets is also mostly up to card issuers. So far I’ve added AAA and Sam’s Club to my Apple wallet. Both required work I wouldn’t have done if I wasn’t doing research for this newsletter.
So neither Apple nor Google wallets are what marketers call a whole product. But they’re headed in that direction. And that’s a problem for two reasons. One is that together they comprise a closed and proprietary duopoly. The other is that they are not ours.
Toward solving the first problem, the Linux Foundation has stepped up, announcing plans to form the OpenWallet Foundation. Here’s the subtitle: A Consortium of Companies and Non-Profit Organizations Collaborating to Create an Open Source Software Stack to Advance a Plurality of Interoperable Wallets.
The press release says the OWF’s mission “is to develop a secure, multi-purpose open source engine anyone can use to build interoperable wallets…for use as a starting point for anyone who strives to build interoperable, secure, and privacy-protecting wallets.” Also, “The community will focus on building an open source software engine that other organizations and companies can leverage to develop their own digital wallets.”
Note that it says theirs. Not ours.
These wallets will be theirs because the Linux Foundation is a 501(c)(6) business league to which half of the Global 2000 belongs. (Google is a member. Apple is not.) Under the LF’s umbrella are seven initiatives and sixty-two projects, all work as settling tanks for competing entities with common interests in having standards and tools useful to every developer, while not duplicating work or competing pointlessly. Once formed, the OpenWallet Foundation, aka OWF will join one of those lists.
The announcement, Stephen Vaughan-Nichols reports in ZDNet, took place at the LF’s Open Source Summit Europe in September. There, Daniel Goldscheider, yes.com CEO and founder of the OWF, explained how open wallets will work:
When you think about OWF, an analogy you can use is how no matter what web browser you use -- Google Chrome, Microsoft Edge, or Mozilla Firefox -- you've taken advantage of browser engines such as Blink or Gecko.
And these browser engines support many standards, so you can have an easy web browsing experience no matter which browser you use. OWF wants to do that, so no matter what e-wallet you use, you can use it at any digital wallet point-of-sale or contact.
Stephen goes on to report,
Organizations and companies can then use this open-source software engine to build their own digital wallets. Or, existing digital wallet backers can adopt OWF software to improve their wallets. In either case, OWF-enabled wallets will support use cases from identity to payments to digital keys. The aim will be to make it so that new OWF wallets will have all the features of the proprietary software-based wallets.
Companies such as Accenture, Avast, and CVS Health are already backing OWF. As CVS Executive Director of Technology Research & Innovation Robert Samuel said, "Providing secure identity and validated credential services are key for enabling a high-assurance health care service. OWF could contribute a key role in promoting the deployment of highly effective secure digital health care systems."
OWF isn't ready yet to try: This project is still in the concept stage. There isn't even any alpha software available yet. That said, given the track record of open-source projects catching up to and overtaking proprietary programs, I have no doubt you'll soon be using OWF software in your e-wallet.
Two things to bear in mind.
Google’s wallet and VRM (May 2011)
Circling around your wallet (August 2011)
Wallets should be wallets (October 2012)
Maybe wallets can’t be apps (January, 2015)
The other is that browsers are a bad model for the wallets we need. That’s because we need wallets to be ours and private, and browsers are neither.
The main browsers these days are Apple’s and Google’s, but all of them have a legacy design flaw: with them we are mere users, and not independent actors able to operate at full agency. This is why we are so vulnerable to spying by the websites and services of the world.
Browsers are also not personal. Nor are our phones or the apps on them, so long as we are just users at the mercy of sites and services.
Worse, regulators assign responsibility for our privacy entirely to those sites and services, on the correct assumption that we are also mere “data subjects” (the GDPR’s label) or “consumers” (the CCPA’s label), rather than independent actors with the power to secure our own private borders on the Net. Nor do they imagine we can signal to others our own privacy policies and preferences, as we do in the natural world. (Personal privacy preference signaling through browsers was tried once, with Do Not Track. When that failed, we mounted the biggest boycott in human history: ad blocking (some of which also blocked tracking). That failed too. Tracking people online is now more widespread, deep, and normative than ever, regulatory pushback withstanding.)
So how are we going to make wallets personal, private, and our own, as independent human beings?
The answer is by having developers working for a .org responsible to people rather than companies, and can collaborate with the OWF on the open wallet project.
Fortunately, we have a .org built to provide exactly that kind of work. Customer Commons (aka CuCo) a 501(c)(3) is a nonprofit spun out of ProjectVRM in 2013 to help fulfill the promise in the title and contents of my book, The Intention Economy: When Customers Take Charge (Harvard Business Review Press, 2012). (I’m a co-founder and board member.) All CuCo needs to get this rolling is funding. With that, it can start working on the project and engaging with the OWF.
That funding will have to come from individuals and foundations because CuCo’s bylaws forbid corporate contributions. This makes CuCo an ideal complement to the Linux Foundation, which is a business league. We can have customers and companies, working together.
So I invite your help with that.
In the next newsletter, I’ll list a pile of business solutions that can only be solved from the customers’ side: ones that cannot be imagined from inside business as usual (where customers are always dependent variables), but can create huge benefits for the LF’s and OWF’s corporate contributors—and markets in general. All of those solutions will be advantaged by open wallets that are customers’ own.
Addendum, added on Monday November 7—
I should make clear that wallets in the natural world are containers of cash, credentials, receipts, and other bits of paper. They don’t engage or operate with other parties. For that, we will need instruments of some kind. The word agent is often used, but can be confusing because in the offline world it tends to mean an entity other than the individual operating on the individual’s behalf. For example, an insurance agent, or a stock broker.
I’ve also heard suggestions that all this engagement stuff is going to be way too complicated for the individual, so only a fourth party (a kind of third party working for the individual) can carry the load.
While I am sure fourth party services (see that last link) are a good idea and probably inevitable, I don’t believe the instrumented side of a wallet needs to be complicated, either by itself or through the addition of other actors working on the individual’s behalf.
It is essential to think of this whole challenge from the individual’s side. Because it’s not just the wallet that needs to be personal. It’s the whole way the person engages others in the marketplace. Key challenges:
Basic functions have to be so simple and obvious that the individual (again, not “the user”) says, “I’ve gotta have that.” And by “that” I mean one wallet the individual knows is theirs alone. It must be an invention that mothers necessity.
The individual needs to be in control. The wallet and its instruments need to be truly and fully personal. We can’t have it fail us, as happened with the browser.
Wallets need to be as substitutable as real-world wallets, watches, clothing, and jewelry. You can take your credentials and other goods out of one and put them in another.
Self-sovereignty is key. Essential.
When I look at the OWF conceptual architecture on Github, I don’t see any reason all of this can’t be done. But I do worry about two things. One is that the range of imagined uses seems small. The other is that everybody working on this is doing it for their employers and not for you and me. But I also think that’s fixable, if I’m right about it.
P.S. We will be talking about this on VRM Day (November 14) and at IIW (November 15-17) at the Computer History Museum in Silicon Valley. VRM Day is free and IIW is not expensive, as three-day conferences go. (It is also almost sold out.) Also, IIW is all-workshop: nothing but breakouts, with no panels, no speakers, and no sponsor booths. (Sponsors only buy food and supplies.) And, because it’s designed to host work, its outcomes are the most leveraged I know. I invite folks from the LF and the OWF to come, talk wallets, and show whatever work might be in progress. Customer Commons will also be there.
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