Bank of America, America’s largest bank in terms of customers, and Visa, the world’s largest payment processor, are set to begin trials of mobile phone payments next month in the New York area according to Reuters. People in the trial will be given “small chips” that they’ll place “in their smartphones” which will “emit radio signals over very short distances”. I quoted all those parts because I don’t want to get ahead of myself and say that this is NFC based. It can, or it can’t be, but either way it’s wireless and it isn’t going to involve consumers buying a new mobile devices.
Judging by the two companies conducting the trial, it looks like the banks and Visa want to control the customer. By making the authentication bit, the “small chip”, a separate module that you can install inside any mobile phone, versus having to get a mobile phone from your operator that has wireless payment capabilities built in, Visa gets to keep the relationship they have with you and your bank.
This is a play against AT&T, Verizon, and Bloomberg, which broke the news of the operators upcoming experiment, specifically mentioned the almost abusive relationship merchants have with Visa due to the fees they charge to accept their cards., who together with Discover Card and Barclays are conducting their own series of trials.
The lines in the sand are being drawn and it has this blogger ticked off. The technology has always been out there to make our lives easier, but it’s who owns the control point, the bottleneck, the part of the process that is critical to make this whole thing work, that is currently being fought over and in the end we the consumers lose out.
The Japanese have had mobile payments for years, and it’s one of the most successful services, one of the most referenced services, that operators, handset makers, banks, payment processors, even governments, have cited as a model to emulate.
So I’ve got to ask: WTF is taking so long?
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