US Telcos To Unveil Details On Mobile Payment JV -Sources
16 Novembre 2010 - 12:43AM
Dow Jones News
Verizon Wireless, AT&T Inc. (T) and T-Mobile USA will unveil
more details on their joint venture to create a mobile payment
network, which will be financially backed by Barclays PLC (BCS) and
Discover Financial Services (DFS), as soon as Tuesday, according to
people familiar with the situation.
The joint venture will be lead by Michael Abbott, formerly chief
marketing officer at General Electric Co.'s (GE) GE Capital
division. Discover and Barclays will also officially announce that
they are participating in the venture. A formal announcement can
come any time between Tuesday and Thursday.
In Abbott, the joint venture gets a neutral executive without
any baggage from the telco side, critical given the carrier's
natural reluctance to work with each other.
But the rare showing of cooperation between three of the four
national carriers creates a potentially large base of users for its
mobile payment system. The carriers are eager to move into mobile
transactions because it represents a new revenue stream and another
feature that get its subscribers spending more time on their phone.
Discover benefits from additional financial transactions over its
credit-card network, and Barclays gets a foot in the door of the
U.S. consumer market.
The telco joint venture comes as major credit card companies
such as Visa Inc. (V) and Mastercard Inc. (MA) are pushing their
own mobile payment initiatives. In July, American Express Co. (AXP)
hired Dan Schulman, who was the architect of Sprint Nextel Corp.'s
(S) prepaid wireless strategy.
The divergent paths underscore the tension over who controls the
mobile payment network, how the revenue is divided, and which party
shoulders the financial and legal burdens.
Canada, meanwhile, has for years had a similar mobile-payments
joint venture between its three main wireless carriers, which last
year started a service that lets users send money to and from their
phones. Unlike its U.S. cousin, though, the Canadian venture is
aiming to bring services from all the country's big credit-card and
financial firms to mobile phones.
Both sides, however, are embracing a technology called
near-field communications, which allows a person to wave their card
or phone in front of a scanner to pay for goods and services. NFC
is already found in cards, and can be accepted at drug-store chains
and gas stations.
Companies currently rely on NFC stickers or memory cards with an
NFC chip shoved into cellphones--slowing adoption of the feature.
But newer cellphones are expected to have the technology fully
integrated. Research in Motion Ltd. (RIMM), for example, will use
NFC chips in its BlackBerrys next year, according to people
familiar with the company's phone rollout plans. Nokia Corp. (NOK)
has been experimenting with NFC technology for years.
-By Roger Cheng, Dow Jones Newswires; 212-416-2153;
roger.cheng@dowjones.com
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