The mobile payments scene got a little more complicated Tuesday, as the big traditional credit card companies joined the Isis mobile payments consortium run by AT&T (NYSE: T), Verizon, and T-Mobile in what might be a hedging move by Mastercard, a launch partner for Google (NSDQ: GOOG) Wallet. The move makes sense now that Isis no longer plans to build its own payment network to challenge the traditional payment processors, but might fragment mobile payments before they even get off the ground.
Isis was formed last November by three of the four largest wireless carriers in the U.S. to investigate and deploy technology designed to let consumers use their mobile phones as digital currency. It welcomed American Express, Discover, Mastercard, and Visa Tuesday to the consortium, saying in a press release that “Isis’ relationships with all four payment networks mean that with Isis-enabled phones and payment terminals in place, merchants and consumers will have ubiquity and freedom of choice when it comes to payment network acceptance.”
That could be a problem for Google, which is trying to build a similar network of phones and payment processing terminals equipped with NFC (near-field communications) wireless technology. There is a lot of enthusiasm for the concept of mobile payments among mobile industry companies and payment processors, but any such venture will need the support of both phone makers and the retailers who must install new equipment in their stores to accept mobile payments.
Google thought it had solved part of that problem by tapping into Mastercard’s existing PayPass network, but if retailers participating in the Isis system can accept payment from all four major payment processing companies, that could prove more attractive. It’s very early days for this type of technology but the growth of the Isis consortium underscores how seriously some big-name players in payments are taking the mobile opportunity.