In the competitive U.S. mobile market, the big carriers, especially the top two, Verizon and AT&T, are not above calling out their rivals by name in television commercials–rather frequently, in fact–pointing out the inadequacies of the other’s network while promoting the advantages of their own.
But apparently behind the scenes the big four U.S. telcos can agree on something–mobile payment offers an opportunity, and they don’t need big banks along to cash in.

This is what NFC Times is learning of discussions and planning that have been going on involving representatives of the telcos, Verizon, AT&T, Sprint and T-Mobile to build a platform for future m-payment projects. That includes hiring a trusted service manager and discussing use of contactless media. The telcos also seem to believe contactless technology, either Near Field Communication phones, contactless SD cards, chip-embedded stickers or all of the above could provide the vehicle for all or part of their rumored payment plans. Those plans could also include remote payment.

But as to the payment applications, acceptance infrastructure, payments partners and, of course, the all-important business case the telcos will pursue, it’s still open to speculation.

The conjecture is that the telcos would work with a company that has broad relationships with merchants. Some have mentioned large third-party processor First Data, which has shown interest in facilitating NFC and contactless-mobile payments for service providers and claims to have relationships of some form or another with merchants representing as many as 70% of the 7 million U.S. merchant locations now accepting conventional cards.

And perhaps the telcos and Discover Financial Services would cut some type of deal that would put Discover’s Zip application on the contactless devices.

Zip already rides piggyback on contactless terminals at 70,000 U.S. merchant locations that also accept–contactless cards–accepted that is, on those occasions consumers use contactless cards. When they do, the cards sport either Visa payWave, PayPass from MasterCard or ExpressPay from American Express. Zip’s share, according to Discover, represents about 80% of the total contactless merchant locations in the U.S.

But unlike the other brands, there are no Zip contactless cards in circulation. Discover has given off strong signals that when it comes to contactless, it is holding Zip out for mobile payment, including putting it on passive stickers consumers can attach to their phones.

But surely passive stickers are not all that Discover has in mind for Zip. It couldn’t even brand the stickers it rolled out or could only brand them very discreetly–that is, if it heeds the results of its survey of 700 employees participating in a Zip-sticker trial the card scheme launched last April.

In that survey, staffers said they liked to tap with the stickers to pay–but more than two-thirds also said they would want to hide the stickers–and, therefore, the company’s brand name. During the trial, many concealed the stickers underneath the casings of their phones or battery covers, lest onlookers discover they were using their phones as payment devices.

Might the Discover brand show up one day on mobile phone screens connected to Zip applications stored on contactless microSD cards or NFC phones and rolled out by one or more of the operators?

There’s nothing yet to connect Discover with the telcos’ rumored m-payments plans. And Discover, in fact, may be looking to stickers precisely to avoid working with mobile operators while they wait for NFC phones more generally to hit the market.

Still, Zip is unlikely to make much of a splash if issued only in sticker form. First Data’s own Go-Tag passive sticker
has so far fizzled in the market since launching with three retail chains.

So Zip is an option for the telcos, which may not want to deal directly with powerful payment schemes, Visa and MasterCard. Those schemes may not be waiting to find out what the telcos do. Visa Inc. announced Feb. 15 it plans to introduce a contactless microSD card made by U.S.-based DeviceFidelity carrying its payWave application. It will begin trials with banks but no operators, in the second quarter. But Visa said it would be more than happy if carriers distribute the contactless microSDs for its bank issuers.

In any case, whatever the telcos decide to do with their mobile-payment initiative, it would not be necessary for them to agree on the same contactless payment application. The word is they are building a platform, not a single payment service: Suffice it to say, a joint promotion of mobile payment between Verizon and AT&T is definitely not in the cards.

Dan Balaban is editor of NFC Times.