Isis, the telecommunication consortium intent on offering a mobile-payment scheme, is adding a wider range of mobile-wallet capabilities to keep up with its aggressive rival, Google Inc.
By licensing a software-development kit from mobile-application provider C-Sam Inc., Isis hopes to add payment, rewards, coupon, ticket, transit and other mobile services. Isis consists of AT&T Inc., Deutsche Telekom AG's T-Mobile USA and Verizon Wireless, a joint venture of Verizon Communications Inc. and Vodafone Group PLC.
The deal with C-Sam enables Isis to “build a secure transaction ecosystem and offer consumers a comprehensive mobile wallet for conducting payments, redeeming offers and storing loyalty cards,” says Jayme Johnson, Isis head of marketing.
Time is of the essence because competitors such as Google Wallet also are moving quickly to tap Near Field Communication technology to build a mobile-payments ecosystem. Google, whose partners include MasterCard Worldwide, Sprint Nextel and Citigroup, is testing mobile payments this summer in San Francisco and New York . Isis also is plotting its debut in Salt Lake City and Austin transit systems in a few months.
“Isis needs mobile-wallet software that manages how things happen within the wallet, how different parts can be loaded and how consumers choose which card to use for payments,” says Zil Bareisis, a senior analyst for Celent. He notes Google has entered into a deal in which First Data will power parts of its Google Wallet through First Data’s Trusted Service Manager technology. “None of that would be the core competency of a telecom operator,” he says.
Google also enhanced its mobile-payments capabilities by agreeing to purchase Motorola Mobility.
Isis hopes the C-Sam deal will allow it to scale quickly. C-Sam, which provides coverage across a number of carrier networks, operating systems and NFC handsets, bundles more than two dozen payment services within its software development kit, such as coupons, parking and health care.
In a statement, C-Sam said its “platform and development work with Isis will allow the Isis wallet to be deployed across a full range of handsets, will enable and power a broad range of mobile-commerce use cases and value-added services, and will support the full range of security and risk-management protocols of Isis’s other partners and back end providers.”
After initially positioning itself as a competitor to card networks, Isis recently opened its model to the networks, and has signed deals with Visa Inc., MasterCard and American Express Co. Isis hopes consumers will pay via NFC phones, which would be waved near terminals and transfer payment information and other data that presumably usable for loyalty programs, coupons or targeted marketing.
Isis and Google still face tech challenges, particularly in attracting wide participation of card-issuing banks as part of their respective payments networks.
“We’ve seen this with bill pay and [personal financial management]. I believe for any solution to work; it’s going to have to be integrated with mobile banking offerings,” says Brad Strothkamp, a vice president and principal analyst for Forrester Research. He says maintaining separate apps and authentication for mobile payments and mobile banking is a hindrance to consumer adoption. “Mobile banking is one of the main apps that you’ll have on your phone. Why would you not want [payments] to be a part of mobile banking?” he asks.
