Watching the mobile wallet space is likewatching a meteor shower. Each bright light that flashes has itsown unique trajectory, but they’re all coming from the same generalarea and they’re all headed in the same general direction. To carrya simile too far, most of the over one hundred mobile-walletapproaches out there will be exactly like those meteorites – thelittle ones will burn up and disappear in what is a very hotcompetitive landscape and a very few, mostly larger ones, willsurvive.
It is still unclear who among the mobile wallet offerings willbreak through. One of the most interesting, even inscrutable,efforts comes from U.S. mobile operator Sprint. Sprint has been afriend to Google and the web giant’s Wallet initiative. There areeven five phone models on the Sprint network that support GoogleWallet.
But more interesting is Sprint’s go-it-alone approach to mobilepayments. Like AT&T, Verizon Wireless, and T-Mobile, Sprint isinterested in mobile payment and commerce-based revenues. Unlikethe other three, Sprint chose not to participate in Isis, thepayments joint venture that is about to go live with major pilotsin Austin, Texas and Salt Lake City. Sprint is building its ownmobile wallet called Touch, one that is apparently far more open tosoftware developers. Here are some of the specifics, as they’reunderstood, from NFC Times:
No. 3 U.S. mobile carrier Sprint is planningto launch its own NFC mobile wallet as early as this summer,NFCTimes has learned, as the mobile wallet war in the United Statescontinues to heat up.
Sprint’s wallet plans represent another blow to Google, whose ownwallet has been distributed by Sprint, which remains Google’s lonewallet partner among mobile operators.
Sources told NFC Times that Sprint sees advantages in rolling outits own wallet, which according to the sources is named “Touch.”With a wallet, Sprint could build relationships with banks andother service providers. With the Google Wallet, Sprint hasvirtually no involvement with service providers.
It’s not clear whether Sprint would drop support of the GoogleWallet altogether, although it seems unlikely that it could supportboth wallets on the same NFC phones, since each wallet requirescontrol of the secure element.
“The limitation isn’t the wallet; the limitation is the secureelement,” said a source at Sprint, who added the Sprint walletoffers a “legitimate alternative to Isis.”
While all of that is interesting, it is remarkable that Sprintsees strong opportunities in its own wallet. After all, merchantshave to accept it. While it will, in all likelihood, use paymentcard emulation mode – the same as Isis – the programmaticinterfaces for couponing and other commerce services just aren’tstandardized today. That means merchants may have to build specialsoftware to support Sprint Touch while they’re also looking atsupporting the Isis wallet, Google Wallet (whatever that morphsinto next), as well as other options. While all of that istechnically possible, merchants have limited IT budgets and R&Dtime. Whoever brings the most customers will get merchants’attention and, as the number three mobile operator, Sprint startsfrom a lagging position. Yes, Sprint’s Touch could offer bettercost and performance benefits to card issuers and merchants butcompeting on price isn’t a great way to start.
Another dimension which affects Isis as well is the willingness ofconsumers to use a payment wallet provided by a mobile operator.Consumer acceptance of Isis is something we will watch veryclosely. But merchant acceptance and access to value-added servicesfrom Sprint is also important. With competing, cloud-leaningapproaches available to merchants from payment services providers,there are still plenty of flashing lights in the mobile sky. Justremember, many will flash just once and be gone.
