Carriers no match for Credit card companies for Mobile payments

Samsung’s Nexus S includes NFC capability, which means you’ll be able to use it to make mobile payments (someday). Photo Jon Snyder/

Isis, the collaborative mobile payments venture initiated by three major U.S. telecom carriers, is scaling back its efforts to compete with the credit card industry.

Created in a joint effort by T-Mobile, Verizon and AT&T, Isis first aimed to allow customers to pay for purchases at retailers by using their smartphones, with a network of payments independent of credit card companies. Purchases and account information would have been handled by the carriers.

Instead, Isis now has its sights set somewhat lower.  Isis is now working to produce a sort of “mobile wallet.” Customers will still use their smartphones to pay for purchases, but instead of an independent payment network ran by the carriers, the phones will use your existing credit card information.

Isis had already enlisted the help of Discover Financial Services to start the venture’s payment system. But Discover is no Visa or MasterCard, and merchants weren’t keen on the idea of cutting out the two giants.

And why should they? There’s really no need to reinvent the wheel, just to create an enabling technology which leverages the parts that already work, and make it better. The point is to replace a wallet full of cards, not create new cards.

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