Business Brains

Wait, what, another mobile payments standard?

Posting in Technology

As merchants test the fledgling Google Wallet and the Isis mobile payments services, reports suggest a retailer-driven service and system could be waiting in the wings.

New research last week from Nielsen suggested that close to 30 percent of smartphone users are using those devices for activities related to shopping, which somewhat explains all the to-do this year over mobile payments. That buzz, which I have been covering closely as it relates to my small business coverage, increasingly is making its way into mainstream business headlines.

The Nielsen chart to the right details all the different things that those mobile shopping early adopters are doing; you'll see that "purchasing products" is fifth down on the list. That's probably mainly due to the fact that the technologies for mobile payments are still emerging, and the landscape is incredibly fragmented.

The latest evidence of the latter was the recent revelation in The Wall Street Journal that massive retailers Wal-Mart Stores and Target were among a group of stores that evidently is planning their own approach to mobile payments. This new approach would be competitive to the efforts currently under way, including the Google Wallet effort, and a venture called Isis that is led by AT&T, Verizon Wireless and T-Mobile.

Explaining why retailers feel they need to work on their own system, one of the merchants quoted in the WSJ story is quoted as saying: "What we see out there doesn't make us very happy."

I've followed technology for long enough to know that this is a natural progression in fledgling market. There is plenty of functionality being tested out in the field.

For example, last week, First Data said its OfferWise platforms for "universal commerce" is being piloted with "dozens of merchants" in "more than 4 million U.S. merchant locations." OfferWise is a platform that integrates with merchant point of sale systems to electronically attach deals, e-coupons or other promotional services. The idea is that these offers can be linked with a person's payment card or mobile wallet, so that mobile marketing offers can be redeemed more readily.

In the First Data press release, senior vice president Dom Morea noted: "Our OfferWise solution will enable millions of merchants to create highly relevant mobile marketing experiences with their customers by converting traditional paper coupons, loyalty cards, or receipts into software linked to a payment card or mobile wallet."

The big hold-back for mobile payment schemes right now is the fact that it isn't supported on all that many handsets. When Google Wallet launched in September 2011, it only worked with the Sprint Nexus S and only with Mastercard services. Mind you, Google has plenty of other relationships and partners in the wings. But it is far too soon for retailers to place their bets on any single platform.

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Heather Clancy

Section Editor

Heather Clancy has written for United Press International, ZDNet, Entrepreneur, Fortune Small Business, the International Herald Tribune and the New York Times. She holds a degree from McGill University. She is based in New Jersey. Follow her on Twitter. Disclosure