Isis Announces First Pilot City as Competition Increases

The Isis joint venture, led by big U.S. mobile carriers AT&T and Verizon Wireless, has announced the location of its first NFC pilot next year, Salt Lake City, Utah. And NFC Times has learned that a second pilot city is also planned, which likely will be Austin, Texas.

The Isis venture, which also includes T-Mobile USA, announced that a pilot will launch in Salt Lake City in early to mid-2012. The city is the home of the first transit authority to accept payment of fares by contactless credit and debit cards from all major card brands, including Visa, MasterCard Worldwide and American Express.

In its announcement, Isis said it had concluded an agreement with the Utah Transit Authority, or UTA, to accept the Isis brand from NFC phones, along with the other brands, to pay fares on buses and other transit. Isis said it would be followed by a rollout in the city, including at merchant locations throughout Salt Lake City. But while the UTA is equipped to handle payment from contactless cards and NFC phones, merchants in the city are not yet well covered by contactless terminals.

In addition, a source told NFC Times that Isis is also planning to launch a pilot in Austin, Texas, next year, though it’s not clear if that includes local transit in addition to merchants.

The joint venture is in the process of trying to sign up merchants nationally for its planned payment scheme, along with partner retail network, Discover Financial Services. That is an uphill battle, especially going up against entrenched payment brands Visa and MasterCard. And coverage of contactless terminals is meager for all of the card networks.

In addition, Sprint, the third largest U.S. mobile operator and the only one of the four major national carriers not involved in Isis, confirmed Monday that it plans to offer NFC services separately to subscribers before the end of the year. And the plans call for allowing all card brands in.

And other players are also getting involved in NFC-based mobile commerce, most notably Google, which is building a wallet that will be open generally to card brands and banks.

Isis, itself, has been emphasizing in recent weeks that its NFC mobile wallets would be "open" to all mobile-commerce players and again made the assertion in its announcement late yesterday, including being available to other card networks.

"Additionally, Isis is investing in the necessary infrastructure to enable mobile commerce on a nationwide basis and will be available to all merchants, banks, payment networks and mobile carriers," said Isis in a statement.

It remains to be seen, however, whether Isis brand payment would share the same wallets on NFC phones sold by AT&T and Verizon as accounts branded Visa and MasterCard.

The Isis telcos also have made a point of saying that payment will not be the only service consumers will be able to use on their NFC phones. It said Isis will "evolve to offer customers a highly secure and convenient way to pay, redeem coupons and store merchant loyalty cards, all with the tap of their phone."

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