October 22, 2012
The carrier-backed Isis mobile-payment service debuted in a low-key launch Monday in Austin, Texas, and Salt Lake City with almost 1,000 merchant locations participating and its near-field communication (NFC) system workable on nine smart-phone models.
Digital Transactions News counted 493 merchant locations in the Salt Lake area and 470 in Austin, for a total of 963. Acceptors include numerous locations of McDonald’s restaurants, 7-Eleven convenience stores, and an assortment of other national and local retailers.
The merchant count is well short of the 1,000 merchants in each city at launch that Isis had talked about in February, but it apparently doesn’t include acceptance sites of the Utah Transit Authority, which would add scores more. Also unknown is how many vending machines currently are counted. An Isis executive said in May that it expected 300 Coke machines in Austin would take Isis at launch, and a recent deal between Isis and vending-machine payment network provider USAT Technologies Inc. could add up to 7,500 machines in the two cities. An Isis spokesperson could not be reached for comment late Monday afternoon.
Isis went live several months later than its joint-venture sponsors--AT&T Mobility, Verizon Wireless, and T-Mobile USA--had initially planned. But the fact that the high-profile system finally is live represents a significant development in mobile payments, particularly transactions that use an NFC chip in a smart phone or contactless payment card to communicate with a contactless payment terminal. Users simply tap the NFC phone by the terminal to make a payment.
“The launch of the Isis Mobile Wallet in Austin and Salt Lake City represents a milestone for both Isis and the mobile-commerce industry,” Ryan Hughes, chief marketing officer at Isis, said in a statement. “With as many as 20 Isis-ready handsets headed to market by year end, we are experiencing an unprecedented level of support for NFC and consumer choice.”
With an usually large number of payments conferences occurring this month around the country, Isis almost certainly is the topic of thousands of conversations. At the center of the debate is how well Isis, which requires consumers to use a smart phone with NFC capability with the phone’s carrier-controlled secure element, or SIM card, will compete with other mobile-payments systems that use different technology. PayPal Inc. expects to do $10 billion in mobile-payments volume this year, practically none of it using NFC. Starbucks Corp.’s popular closed-loop mobile-payment system uses QR bar codes.
In addition to the general-purpose card networks, Isis is working with payment card issuers to make their cards compatible with its wallet. As of Monday, the initial Isis-enabled cards include products from American Express Co., Capital One Financial Corp., and JPMorgan Chase & Co. Google Inc. with its NFC-based Google Wallet started out with a similar approach, but recently added cloud-based functionality, which essentially opens its wallet to all issuers.
NFC, however, dovetails well with the loyalty programs and offers that merchants use to attract customers and generate repeat business, according to Isis. Isis has a “Clip to Isis” feature that the Isis Web site says “makes it easy to find and save offers and deals directly to your phone. You can tap from participating NFC-enabled posters or signage, scan from weekly circulars, or click from Web sites or e-mails.”
To crank-start initial consumer usage, the Isis mobile wallet comes with an Isis Cash Card preloaded with $10 upon activation and another $15 when users make the card reloadable.
As noted, Isis expects to have 20 smart phones ready by year’s end. The current models are the HTC Incredible 4G, Motorola Razr HD, and Motorola Razr MAXX HD from Verizon Wireless; the Samsung Galaxy S2, Samsung Galaxy S3, and Samsung Relay S 4G from T-Mobile; and the HTC One X, Samsung Galaxy S3, Samsung Galaxy Exhilarate, LG Escape, and Samsung Rugby Pro from AT&T.
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