With all their niggling and nit-picking, MasterCard and Visa might as well play out their smart card rivalry to the tune of "Let's Call the Whole Thing Off."

The two sides utter many of the same words, but in different accents and contexts, which causes heads to spin in the communities they are vying to win over.

It is, in ways, a throwback to the raucous early days of credit card competition, when the ownerships of the two associations did not overlap as much as they do today and when their respective strategists and marketers went different ways as a matter of principle.

Yet there came a point when the industry coalesced around technical standards like the magnetic stripe, which freed it to focus on branding and other marketing issues. That old data encoding system is "time-expired," said Richard Phillimore, MasterCard International's senior vice president for chip business development.

No dispute there. The stripe now stands to be shoved aside by the computer chips that make cards smart.

If only MasterCard, its Mondex subsidiary, Visa, and supporters of the Visa "Open Platform" could come to a magnetic-stripe-like accommodation, then they and the banking industry might finally bring the chip dreams to fruition on a global scale.

But the planet is not aligned.

Despite agreements on principles-no one argues over the need for "interoperability," for example, or for a strong banking industry influence over how any type of chip-based payment evolves-the much-discussed standard, or "common platform," remains elusive.

The battle for bankers' hearts and minds-and for the loyalties of retailers, government agencies, and others that might piggyback on a common standard-has taken on the character of political and philosophical debates, tinged by technospeak.

If submitted to one of the academic debating societies, the resolution might be: "My language is better than your language."

Visa has hitched its chips to Sun Microsystems Inc.'s Java programming language. If Silicon Valley buzz were enough to power a strategy, the Visa Open Platform might carry the day. Most of the key smart card vendors are on board, as is Citicorp, one of the most technologically advanced banking companies.

Standard Chartered Bank of London, which is headed by Visa International's newly designated chief executive officer, Malcolm Williamson, in June became the first to test cards conforming to the Visa Open Platform and Java Card 2.0 specifications.

Visa had "the courage to get out front and devote its energies to an open standard," Citibank vice president Henry Lichstein said recently. "It is a point that the industry can rally around.

"We need the Open Platform," he said, adding, "We are getting to critical mass."

Despite disparagement from Visa, several dozen banks worldwide have rallied around Mondex and its operating system, Multos, which is the smart card equivalent of Windows or Macintosh OS in a personal computer. That presents enough of an opportunity for technology vendors to side with Mondex too.

Development of Mondex began eight years ago, before there was a Java. The inventors at National Westminster Bank in London and their successors in the Mondex International Ltd. spinoff never looked seriously at Java, except as an optional attachment to the framework they built around a language called MEL-Multos Executable Language.

Mondex and Maosco Ltd., the consortium it formed to govern and license Multos, have taken shots from the Visa camp for the "proprietary" nature of Multos and MEL. Java is anything but proprietary, in that it is compatible with any type of computer system, "scales" to any size of device from smart card to mainframe, and is ideal for "dynamic loading" and updating of programs remotely, via phone lines or the Internet.

Mondex has a rejoinder: Anything that Java, via Visa Open Platform, can do, Multos can too. That includes running Java programs.

They both trumpet cross-platform interoperability, a high degree of flexibility, dynamic loading, a "virtual machine" approach to managing software on the cards, and the virtue of being "future-proof" to protect members' investments.

Just as Sun Microsystems speaks of Java and its new network architecture, Jini, as elements of a global computing organism summed up by its parts, Mondex sees each newly issued "computer on a card" as expanding its system capacity.

Mr. Phillimore of MasterCard listed "five pillars" of its chip strategy: interoperability, business flexibility, technology flexibility, infrastructure and implementation, and communications and training.

These could fit nicely alongside the qualities attributed to the Java Card Application Programming Interface at the java.sun.com Web site: platform independence, multiple applications, post-issuance applications, flexibility, and compatibility with existing smart card standards.

Sun says the inherent qualities of Java-programmability, portability, reusability, multifunctionality, security-scale down to cards.

Mondex retorts that Java capabilities must be so watered down to fit in the constrained memory of an embedded chip that the result is something less than pure Java. (The next generation of higher-capacity chips could solve that problem.)

"Java is 15% to 20% of what Multos is," said Nick Habgood, chief executive officer of London-based Maosco Ltd. "That is why Multos can be described as a complete solution."

He throws the "proprietary" accusation back at the Java advocates, saying Sun Microsystems and its JavaSoft unit have ultimate control over the Java Card standard and keep a tighter licensing rein than does Maosco over Multos.

Meanwhile, Visa is running advertisements strongly implying that its competitor's technology "comes with an expiration date."

As the arguments come down from philosophical heights, Visa likes to point out that at least 22 million of its cards worldwide have chips, including eight million of the Visa Cash variety, versus less than 500,000 Mondex cards. Visa's outgoing president, Edmund Jensen, has said one-third of all Visa cards in 2000 will have chips.

Still, Mondex has millions in the pipeline and notes that they are technically unified, in contrast to Visa Cash's multiplicity of platforms from country to country. Mondex chief executive officer Michael Keegan accused Visa of "overpromising a global solution" using interim rather than fully featured technology and of "subsidizing the market," proliferating its cards first and worrying about cross-compatibility later.

Mondex and Maosco have three major brands in their corner-MasterCard, American Express, and Discover. Visa has campaigned for a single electronic purse standard and, though Mondex resisted, purse organizations in Germany and Spain with more than 40 million cards between them agreed with Visa to become interoperable.

The choice for bankers comes down to desired timing, perceived practicality, and brand preference, and given human and business nature, that means unanimity is lacking.

Tim Jones, the Mondex co-inventor who has risen to head of retail banking at Natwest UK, said necessity spawned the Mondex operating system and "we are not worried that it is not called Java."

"We didn't do Multos to dominate the world," Mr. Jones said in an interview. "We needed a secure multiple-application operating system," allowing electronic cash to be combined with, say, a credit card or a wireless phone service, "and there wasn't one."

Java Card, Mr. Jones added, is "interesting and not a threat." He pointed out that Mondex has worked with JavaSoft and can handle Java with Multos' virtual machine.

Encapsulating Visa's view of Java, Philip Yen, senior vice president, said in April: "The strong momentum and growing industry support for the Open Platform is based upon the fact that it represents the best, most proven solution for banks to create successful smart card programs.

"By utilizing the Java Card technology, which has broad industry support worldwide, Visa is offering its member banks maximum flexibility and greater options as they build smart card capabilities to meet the specific needs of their customers."

Mr. Yen said as many as 20 Open Platform projects would be under way within a year and a half. He called the backing of more than 50 technology suppliers a strong vote of confidence in Java.

Except to the extent they may find the drama of the debates interesting, bankers in the United States, with their dearth of smart card projects, may not feel compelled to pay too close attention. They might be surprised to learn, according to Visa International senior vice president Jon Prideaux in London, that "there is no Visa Cash versus Mondex debate in Europe," either.

For all its inroads in Canada, Latin America, and Asia, Mondex has yet to alight in continental Europe. Mr. Keegan said a Scandinavian announcement is imminent, and there will be more. But Mr. Prideaux is declaring victory with the recent e-purse interoperability initiative announced by Visa, ZKA of Germany, and SERMEPA of Spain.

Visa's aim, he said, is to promote multinational compatibility and help banks get the most out of infrastructure investments already made. A common platform encourages vendors to compete in system development, which improves products and drives down costs. "We are in the business of giving people choices," Mr. Prideaux said, "not taking them away."

His boss, Visa European Union chief executive officer Hans van der Velde, tried to convince MasterCard/Mondex and their Europay affiliate to accept an interoperability regime under the EMV (Europay-MasterCard-Visa) structure they put in place for chip cards and point of sale terminals.

"They didn't want an interoperable purse and common standard," Mr. van der Velde said. "They publicly said it was anticompetitive," but the Visa executive suspects they were more concerned about losing their $200 million investment.

Mr. van der Velde said it is only realistic to expect a single standard will emerge, as it did with VHS videocassettes, and at the operating platform level it should be as accessible and acceptable as gasoline for cars. To him, Java is the only such "fuel."

"If Multos runs on the Java language, I don't have a problem with it," he said. "But if it has to have, say, a Maestro (MasterCard debit) product on it, that's wrong. That's a brand decision."

Maosco does open Multos for any brand and points to American Express' support as an endorsement. Similarly, Visa officials recognize they will win no monopolies on a truly open platform. They say settling on a standard would let them get on with the real business at hand.

But Mr. van der Velde's EMV proposal bristled, and Mondex claims it is not alone in being wary of Visa's motives. With its interoperability initiative, "Visa has put itself in the front of the room and will know what everybody else is doing," Mr. Keegan said.

"No system today is really interoperable," said Armand Linkens, director of sales and marketing for the Banksys Proton purse system in Belgium, which American Express and Visa have been rumored to be courting as an acquisition. "Our competitors are not even interoperable with themselves."

Richard J. Fletcher, Mondex director of strategy and planning, said there is "a lot of nonsense talk about interoperability.

"You need terminals and ATMs able to accept multiple products. Imposing a common product on a new concept like electronic cash would be to freeze the technology, and that is not a good thing for the industry to do."

Mr. Fletcher said Mondex was built to "compete with cash" and has stayed on course despite a lot of European sniping. Mr. Phillimore called it a "moral high ground" that requires persistence to defend.

But as long as Mondex advocates a particular non-Java operating system, Visa may have a hard time going more than halfway.

"The technology shouldn't be the debate among card associations," said Mr. Jensen.

"We are not a technology company," said Mr. van der Velde. "We don't talk about brands on tracks 1, 2, and 3 of the magnetic stripe. Why should we discuss brands with chip?"

On the Mondex side, though, Mr. Jones seems no fanatic: "It's not clear to me that the operating system is as competitively important for chip cards as for PCs. Customers are not buying an operating system. They will be buying a card from somebody."

Duncan Brown, North American director for the London-based research firm Ovum Ltd., predicted there will be no "outright winner" as this competition unfolds.

Ovum concluded in a recent report that Java Card was not as ready for prime time as Multos. But in a paper presented to the Cardtech/Securtech conference in April, Mr. Brown said, "There is nothing to stop a Java Card virtual machine being implemented on top of Multos. However, this has more political than technical significance, and Multos and Java Card will evolve in parallel, but separately."

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