Primitive-based payment systems for flexible value transfer in the personal router

Abstract

The Personal Router is a mobile communication device developed by the Advanced Network Architecture group at the MIT Laboratory for Computer Science. The Personal Router is able to select and negotiate connectivity with local providers for different kinds of services and interfaces. It needs payment procedures to support these services. As this device is designed to be used in many distinct unpredictable contexts, it cannot implement a single payment system. The complexity of existing payment systems has to be mapped into this new environment. A different payment system must be chosen each time, depending on many variables such as costs, environmental constraints, privacy, user and provider's needs and preferences. Privacy is a major issue for this device. In effect, getting wireless and mobile service everywhere will possibly leave an easily traceable trail; moreover, using this device supposes negotiating with many different untrusted providers and paying for the service. This can create huge potential threats for privacy and personal data management if this issue is not included in the early stage of the design. Legal requirements and user preferences and expectations for privacy in electronic transactions are therefore explored. Past attempts to enhance privacy in different environments are examined. Reasons why most of them have failed and some of them are struggling to stay alive are analyzed. New privacy threats faced by the Personal Router are considered. A new approach based on building blocks is made. Payment systems are split into primitive operations; each of them implements one step of a transaction. The combination of these building blocks replicates a payment protocol. The characteristics of a payment system can then be derived from the analysis of the implementation of each of these primitives. Users' preferences are defined by attributes. Payment systems can then be compared through their primitives and even slightly modified to be closer to users' ideal system by altering the primitives. The modular approach makes this easier. This framework is successfully tested on three major electronic payment systems. Several limitations of this approach and open issues related to the Personal Router are exposed.