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Italy’s largest telecommunications company, Telecom Italia’s mobile unit, TIM, was the first operator in the GSM World to put lots of kilobytes of memory on its SIM cards. It used the extra space to store menus for the SIM-based services it rolled out to subscribers.

Other mobile operators followed TIM’s lead in moving to 64K and then 128K of memory for their SIMs. TIM thought it could also play a leading role three or four years ago when it shunned NFC in favor of longer-range ZigBee wireless technology.

It claimed to have built the world’s first ZigBee SIM in late 2005, part of a plan to make the SIM the control center of handsets and have the phones act as television remote controls, mobile-ticketing devices and banking and loyalty cards.

No one followed this time, and TIM came to its senses and joined the crowd in developing NFC. And like several other mobile operators, it was already predicting rollouts of NFC-based mobile payment by 2008, a projection that proved far too optimistic.

The telco is planning to launch mobile payments in 2010, but not with NFC. It is reportedly partnering with the Italian consortium Movincom to launch network-based payments for goods and services using a SIM-toolkit application.

But TIM continues to develop NFC on a separate track. The telco has held at least three NFC pilots, all of which put applications on a TIM-issued SIM. It plans more in 2010, including those with transit-ticketing applications. An NFC rollout is possible for TIM in 2010 if it can get the phones supporting SIM-based applications.