Isis, a joint venture from AT&T, T-Mobile and Verizon, was formed with the idea of using Near Field Communication enabled devices (like Google’s Nexus S) to replace credit cards. They also had aspirations of replacing (or at least competing with) the credit card companies themselves, and using terminals to accept payments directly, billing clients on their existing wireless bills.
Today the Wall Street Journal reports that those aspirations have flamed out, and now Isis has come to VISA and Mastercard hat-in-hand to develop a “less ambitious” system that offers a credit card alternative rather than replacement.
The end result might be less interesting and far less lucrative for the carriers, but is ultimately just as convenient for consumers.
“…the group has adopted the less ambitious goal of setting up a “mobile wallet that can store and exchange the account information on a users’ existing Visa, MasterCard or other card,” people familiar with the matter said.” -wsj.com
Isis’ original plan involved using existing Discover card terminals to handle transactions. Merchants were understandably (for anyone who has ever tried to use a Discover card) less than enthused about the number of places the technology could be used.
Now that the carriers can’t take a percentage of each transaction (a VERY lucrative enterprise, just ask VISA), they’ll need to find a new way to make money off of their NFC endeavor.
Isis isn’t the only game in town, however. As we reported back in January, Google may launch an NFC-based payment system of it’s own later this year. If they’re able to learn from Isis’ mistakes, the credit card companies might actually have something to worry about.
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