July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

KFC launched a new mobile app today in the UK, allowing Londoners to order their girth-enhancing chicken on the go, pop into the restaurant, and pick up their finished order in seconds.

The new technology, which depending on results will be making its way over the pond stateside, was developed with Airtag, a mobile shopping and payments provider that builds white label SaaS technology so that brands can fill out their apps with a branded mobile ordering and payment solution.

“It works on an iPhone app, or a web app,” KFC UK’s IT director Paul Borrett told me yesterday from London. “You select a restaurant, build your order, and pay with a credit card. Then you simply go to a store, swipe a QR code, and pick up your food, cutting out the step of having to stand in line, and saving about 60-70% of the wait time.”

This is not ground-breaking technology, and it has been done before.

Source: KFC, Airtag

KFC’s new mobile ordering app

What’s interesting to me is Airtag’s business model of providing white-label solutions for retailers and restaurants — and how that scales. I asked Airtag CEO Jeremy Leroyer what happens when we deal with 35 different merchants: Do we need 35 different apps?

“This is relevant for bigger merchants,” Leroyer said. “The smaller ones are definitely going to be aggregated, but this is for tier one and tier two merchants. We’re currently working with big grocers to expedite the ordering process, which will enable a similar experience for you to buy groceries.”

Leroyer argues that the important piece of any mobile wallet solution is not the payments or transaction technologies. Rather, it’s the customer experience while ordering, and the services that brands can attach to the ordering process that will make the difference.

That’s an interesting perspective and one that’s certainly worthy of consideration, especially considering the fact that we spend 80 percent of our time on mobile devices in apps. But you have to think there’s a platform play for mobile wallet technology from a Google or Apple that will be accessible to all apps, and require users to enter payment credentials only once.

Which doesn’t mean that a custom experience a la Kentucky Fried Chicken won’t still be viable.

“What we’ve been doing the last few years in Europe is push that experience and those services, to make those wallets relevant,” Leroyer told me. “The wallets that are going to be successful are going to be the merchant wallets.”

It’s certainly working for KFC right now, especially given the fragmented nature of the current mobile wallet landscape.

“I was testing this a week ago,” Borrett said. “I literally was walking to the store, ordered 30 seconds from the store, walked in, scanned, bypassed 6-7 people in line, and got my order.”

Tyfone provides secure mobile financial transactions and identity solutions. Its products include a mobile banking platform, a mobile wallet, identity management, contactless near-field communication (NFC), applications to bolster marketing campaigns, as well as complementary hardware products. Tyfone has over 50 issued and pending patents. By striking a partnership with the Portland-based company, the U.S. government can leverage the technology to serve national security.

In a statement, Technology VP at In-Q-Tel Jay Emmanuel said “We believe that Tyfone’s technology has the potential to address a wide range of complex government and commercial secure identity challenges.” Read the press release.

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

The long awaited mobile payments service Isis is set to debut in September, according to a Bloomberg report. But it’s tough to muster much excitement when the core technology behind Isis, near-field communication (NFC), almost seems more like a fantasy today than when it was a hot mobile payments buzzword years ago.

Perhaps it’s because we’ve seen legitimate mobile payments solutions launch and thrive without NFC. Take Square’s mobile wallet app, which you can use to pay for purchases with your phone without the need for NFC hardware. Even PayPal has been exploring alternative methods of mobile payments with its point of sale solution.

Most damning for NFC are the major partnerships both Square and PayPal have recently landed. Square’s teaming up with Starbucks to entirely replace the coffee shop’s credit card processor, and its app will also work with existing Starbucks scanners at the register (again, no need for NFC). That deal also led Starbucks to invest $25 million in Square.

PayPal, meanwhile, just announced a partnership with Discover, which would bring PayPal payments to more than 7,000 Discover merchants in the U.S.

NFC received plenty of hype several years ago as the golden child of mobile payments, which led to the formation of Isis in late 2010. But since then more practical methods of paying with your phone have emerged, and at the same time, the impracticality of NFC became more evident (which likely had plenty to do with Isis’ delayed launch).

The hardware issue remains a problem for NFC: It requires special chips inside of mobile devices, which still aren’t nearly ubiquitous enough, and NFC readers at retailer registers.

Isis’ biggest competitor is Google Wallet, another NFC-based solution, which has failed to make a dent in the mobile payments arena. Google’s biggest problem is that it has only partnered with Sprint for Google Wallet — Isis has the advantage of being jointly owned by AT&T, Verizon, and T-Mobile.

Isis CEO Michael Abbott told us back in February that he doesn’t believe there’s a mobile wallet war, and he may just be right. There’s room for Isis to coexist among current mobile payment solutions, and it has a good shot of cementing itself as the leading NFC wallet thanks to its carrier connections. Juniper predicts NFC payments will hit $74 billion by 2015, so there’s good reason for Isis to stick it out, even if it doesn’t look like NFC is going to take off right away.

But now, more than ever, NFC mobile payments feel like an answer in search of a problem. Swiping credit cards isn’t exactly difficult for consumers, and it’s a system that we’ve come to understand. Swiping your phone doesn’t seem like a much more convenient alternative, and in many ways it could be more problematic for consumers.

Isis recently joined the newly formed Mobile Payments Committee, something that we’re hoping will give the industry some clearer direction.

There’s still plenty of room for mobile wallets to disrupt the way we pay — just look at the Pay with Square with app, which lets merchants charge you just based on your name and face. In many cases, you won’t even need to pull your phone out of your pocket.

That’s true innovation: something that makes life easier for consumers, merchants, and payment providers alike.

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

It’s easy to think of mobile wallet solutions from companies Google, PayPal, and Isis as locked in a heated battle for the future of payments. But according to Michael Abbott, CEO of the mobile payments company Isis, that’s far from the case.

“There is no mobile wallet war out there,” Abbott told VentureBeat in an interview at the Mobile World Congress yesterday. Instead, he sees all the companies exploring mobile payments now as something that will benefit everyone, including consumers, retailers, carriers, and everyone else involved in the mobile payments chain.

For lack of a proper meeting space, we sat outdoors on a couch in the middle of the Mobile World Congress madness. Directly behind Abbott was the National Art Museum of Catalonia, an imposing and grand building that looks down on the conference housed at the Fira de Barcelona convention center.

The spirit of Barcelona gives almost everything at MWC an extra layer of magic, so my judgement may have been clouded. But as I discussed the future of mobile payments and Isis’ slow-and-steady launch with Abbott, I couldn’t help but think he had a point. We’re facing a sea change with the rise of mobile payments, and now anything that helps to communicate the benefits of paying with your phone versus a dumb credit card will help consumers understand, and ultimately adopt, mobile payments.

Isis, which is jointly owned by AT&T, Verizon, and T-Mobile, is developing a mobile payments network based on near-field communication (NFC) technology. The idea is that you’ll be able to swipe your phone to make purchases instantly and securely. NFC-based swipe and pay is something Google is also exploring with Google Wallet, as well as PayPal with its upcoming wallet (PayPal already offers a way to easily transfer money with NFC).

Isis yesterday announced its first bank partners, Chase, Capital One, and Barclaycard, a big step for the company. The banks have agreed to let their credit, debit, and prepaid cards work with Isis’s mobile wallet. Isis test users in Salt Lake City, Utah and Austin, Texas will be able to add their cards from the companies to Isis in mid-2012.

The bank support comes on top of the payment network partnerships Isis made last year with Visa, MasterCard, Discovery, and American Express.

It may seem like things are moving slowly for Isis, which was first announced back in November 2010. But Abbott says he wouldn’t have it any other way. The company is putting the pieces together for a payment network that will last for more than a decade, Abbott said, so he sees no need to rush out with a half-baked solution.

“We’re solving for a four-sided market,” he said, pointing to the fact that Isis needs to make sure consumers, merchants, payment companies, and its parent carriers are happy with its product.

When I asked if Isis has any contingency plans in mind if NFC doesn’t take off, Abbott said that the company is “looking at everything that works.” He stressed that any mobile payments technology must be secure, cost-effective, and most importantly, fast. After all, if it’s faster and easier to keep using your credit card for purchases, mobile payments will never take off. PayPal, and its parent company eBay, currently have their fingers in other mobile payments solutions, like carrier billing and scanning with QR codes.

So what’s next for Isis? Abbott says that the company will now focus on the consumer side of things, as well as with device makers in the fall. Isis has no release schedule in mind for its mobile wallet, instead, the company is taking a “when it’s ready attitude.”

Given that Isis basically has one shot to get mobile payments right, I don’t blame the company for taking its time to launch.

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

The mobile payment network Isis is said to receive a major boost of more than $100 million from its parent companies AT&T, T-Mobile and Verizon, Bloomberg reports.

According to anonymous sources, the additional outlay is meant to make Isis, a network that will allow consumers to use their phones for payments and reward cards, more competitive against competing mobile payments services like Google’s recently announced Wallet. The actual amount that Isis will get depends on how many banks and merchants it can attract.

None of the carriers would confirm the news with Bloomberg, but it certainly makes sense for them to give Isis an additional push now, as the likes of Google and Paypal are just beginning to lay out their mobile payment plans.

Isis announced in July that it has received support from Visa, MasterCard, American Express and Discover, which means that it will support payments from those major credit card companies. When it was initially announced, Isis seemed like it was going to be a competitor to entrenched credit card companies (though Discover was an early partner, assisting with transactions). That plan has since changed, likely because it’s easier to tap into existing transaction networks instead of starting your own from scratch.

Mobile payments was one of the hottest topics at our MobileBeat 2011 conference in July, primarily because there’s a ton of potential in having your mobile phone take the place of your wallet. Juniper predicts that mobile payments will reach $670 billion globally by 2015.

July 9-10, 2013
San Francisco, CA

Early Bird Tickets on Sale

When it was announced in November, the Isis mobile commerce network seemed like a bold attempt by wireless carriers to edge out credit companies on mobile payments.

Now the carriers behind Isis — AT&T, Verizon and T-Mobile — have lowered their ambitions and are looking to partner up with Visa and MasterCard, the Wall Street Journal reports.

The news is a sign of the growing importance of mobile payments in the next few years. Clearly, the carriers behind Isis are desperate to get a mobile payment system going sooner, rather than later.

Instead of the carriers building their own payment network from scratch, which would have allowed them to collect fees with every transaction, they’re looking to create a “mobile wallet” that would store consumers’ existing credit card information. That would basically make paying for something with your phone no different from swiping your credit card.

Sources familiar with the situation tell the WSJ that it would have been too difficult for the carriers to build their own network, and that they’re in talks with Visa and Mastercard to ensure a large amount of carriers when the Isis mobile wallet launches. Discover — the original partner to handle payments for Isis — is still on board with the revamped plans, an Isis representative said.

It’s unclear how the carriers plan to make money from Isis without having full control of the payment network. According to the WSJ:

One option is a “pay-to-play” program that would charge card-issuing financial institutions to piggyback on their technology, people familiar with the matter said. Another is coupon-style offerings that would allow the carriers to take a cut of the revenue made from special offers served up to mobile payments customers, the people said.

Meanwhile, Isis will face stiff competition over the next few years. Google just recently joined the NFC Forum, which will give it some pull when it comes to the future of the technology. Google has also made NFC a key feature in the Nexus S Android smartphone, and it has teamed up with MasterCard and Citigroup to embed the technology in phones.

But the carriers aren’t sitting still with Isis. They announced today that they will launch a pilot program in Salt Lake City, Utah over the next few months, which will make the Utah Transit Authority system in the city Isis-enabled. Retailers in the city will also be equipped to accept purchases from Isis devices.

As the WSJ notes, the move towards a mobile wallet will put the carriers directly in competition with mobile manufacturers over where secure payment data is stored. Carriers want to store that information on SIM cards, while device makers would rather keep it directly on the phone, or on the non-removable NFC chip.