Mobile Phone Companies Won't Start Rival Payment Network

Plans for Isis, the proposed payment network from the mobile phone service juggernauts AT&T, T-Mobile and Verizon Wireless, will no longer include the development of a way to process transactions, according to a report from the Wall Street Journal. In particular, the companies have had difficulties keeping up technologically when it comes to a standard method for allowing consumers to make purchases using their smartphones, largely because they were attempting to shut out Visa and MasterCard.

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“The carriers have to include MasterCard and Visa,” Drew Sievers, cofounder and chief executive of mobile banking technology powerhouse mFoundry, told the newspaper. “Not including the 800-pound gorillas of the industry will make it very hard to succeed.”

Instead, the phone companies will focus on turning Isis into the same type of mobile wallet program that many other companies are developing, the report said. Now, the service will likely only allow consumers to store payment information on their smartphones, and use those devices to make purchases with near-field communications technology.

Many companies are developing similar mobile wallet programs in an attempt to cash in on the expected boom of smartphones being used to make purchases.

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Image courtesy of Square Inc.