JVL Ventures LLC's Isis rolled out its mobile wallet in two cities Oct. 22, 2012, and opinions differ regarding the significance of this development for the U.S. payments industry. There are nine Isis-enabled handsets available to consumers but, Jaymee Johnson, Head of Marketing at Isis Mobile Commerce, said, "By year end, as many as 20 [types of] Isis-ready handsets are expected to be in-market."
The Isis Mobile Wallet uses near field communication (NFC) to wirelessly transmit payment data stored on the phone to a POS terminal. A company spokesman said Isis demonstrates "an unprecedented level of support for NFC and consumer choice."
According to JVL, to make a payment using an Isis wallet, consumers will need to acquire an NFC-enabled phone manufactured by AT&T, T-Mobile or Verizon, along with a secure element SIM card; download the Isis Mobile Wallet application from the Google Play store; and put their credit card information into the wallet. Consumers also can opt to use the reloadable Isis Cash card that comes with an Isis wallet.
The company reported Isis will ultimately be available to all merchants, banks, payment networks and mobile carriers. It also noted that the Isis Mobile Wallet enjoys the support of local merchants in the Salt Lake City and Austin metropolitan areas, as well as that of national and regional retailers.
Smart Card Alliance Director Randy Vanderhoof believes the joint venture's control over the mobile handset market gives it an opportunity to win consumer adoption, while other mobile wallets, like the software and cloud-based wallet introduced by Google Inc., so far have not.
"This is significant because it is the biggest mobile NFC payments launch in U.S. history," Vanderhoof said. "It is likely going to set the standard for how mobile devices will use NFC. Isis will succeed where Google has not."
Vanderhoof believes Isis' investment in an open system, along with its support for multiple financial institutions and multiple options, will carry the day with consumers. "It is clear consumers expect choice," he stated, pointing out Isis already has three times more wallet-enabled handsets than Google Wallet. For consumers, though, Isis adoption is about more than payments, Vanderhoof noted. He said that in the near future, NFC technology will be used for multiple tasks, including security identification, government ID verification (including drivers licenses and Social Security numbers) and insurance information. Isis-enabled mobile phone adoption will also be spurred by features such as global positioning that add additional value for consumers and create a demand for higher-end mobile devices with more features and richer data plans, he said.
Paul Martaus, founder of the payment consulting firm Martaus & Associates, is skeptical about Isis' ability to obtain a critical mass of consumer adoption. A 30-year industry observer, Martaus believes a dramatic change to a system as large as the U.S. payments system typically must involve an organization - public or private - with the ability to impose a standard on the market.
In the United States, Visa's ability to impose the Europay/MasterCard/Visa global interoperability standard and the Payment Card Industry Data Security Standard are the closest examples of what Martaus described as fiat - the ability to decree.
Martaus said that without fiat, the mobile phone venture may rethink its approach to payments as it comes to better understand the realities and complexities of the payments business.
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