How Isis and the Race to Develop Mobile Payment Solutions Frames the Evolution of the Industry

Your ritual pre-home-departure checklist—keys, wallet, phone—might just get a little shorter over the coming months.  If recent reports are any indication, wallets are indeed well on their way to becoming obsolete (and the fashion world just shed a tear).  This week, it was announced that three of the nation’s largest wireless service providers—Verizon Wireless, AT&T, and T-Mobile—will be joining forces to build a new mobile payment network, called Isis.  This network will enable users with capable mobile devices to make point-of-sales purchases using their Smartphones.

To make this possible, the newly formed enterprise has established partnerships both with financial institutions and with Google, whose Android devices will be specially manufactured to operate on the network.  Discover Financial Services will provide the point-of-sales infrastructure needed to make such contactless transactions functional, and secure.  The Isis network will also work with Barclaycards financial services to make credit transactions possible over the network.  The appointed CEO of Isis, MichaelAbbott, added that the new venture is pursuing other partnerships with banks and financial service providers as well, but these may come further down the road.

Meanwhile, Google CEO Eric Schmidt announced that his company is prepared to develop the corresponding technology needed for making safe, secure, and reliable mobile payments through Android devices.  With this technology, users will be able to make purchases simply by waving their mobile device in front of a corresponding “scanner” unit in stores.  Google will equip select Android devices with the requisite ‘Near Field Communications’ (NFC) microchip that will make it possible to transfer encrypted data between two devices possible when they are in close proximity to one another.  According to Schmidt, Android software version 2.3, also known as “Gingerbread,” will support the new technology, and rumor has it that the NFC microchip will debut on the forthcoming Nexus S, Google’s second proprietary mobile device to hit the market.

According to the announcement, Isis will roll out sometime in the next 18 months.  Chances are, however, it won’t be alone.  A mobile payment solutions report released by Juniper Research forecasts that the market will increase by as much as 73 percent over the next 4 years.  And the telecoms certainly aren’t the only party interested in capitalizing on this growth.  On the contrary, it could be a race to the finish, with wireless service providers, banks, financial institutions and various software developers independently competing to present a solution to current market demands. Currently, Bank of America, the JPMorgan/Chase Corporation, and Wells Fargo are rumored to be in the running with Isis. But regardless of who completes development first, and successfully introduces this technology to the market, with investments across multiple industries, it’s clear that ‘mobile wallet’ technlogy will reach mainstream exposure sometime in the near future.

As mobile technology advances, businesses and individuals should expect to see more and more new applications of the technology emerge, such as the Isis mobile payments network.  And while navigating this complex and evolving realm of new media can seem like a difficult and intimidating chore for brands that are still unsure of how to get started with mobile technology, adapting to the platform will be critical to growing business in the future.  The race to establish a mobile payment network demonstrates how brands—and industries—that integrate such technology into their service offerings to provide an even more valuable business proposition to their clients and target market, stand to profit immensely from the emergence of such innovative new platforms.

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