UK mobile operators Vodafone, O2 and Everything Everywhere are nearing the launch of a mobile payments joint venture (JV), dubbed Project Oscar, after sources claim that European regulators are set to approve the initiative, reports StrategyEye. A Financial Times (FT) report claims that the European Commission is planning to rubber-stamp the service, which will reportedly work with merchants, financial services retailers and banks, and will enable consumers to store their cards on their smartphones, with “few or no remedies” to the proposal. The report adds that that approval for Project Oscar could come as early as the summer. However, the move is set to anger a number of companies, including fourth-largest UK operator Three, which claim that the JV would give the operators an unfair advantage in the still-nascent mobile payments market.
The operators’ move is similar to that of US counterparts, AT&T, Verizon and T-Mobile, which banded together for a JV dubbed Isis last year. Both services mark carriers’ fear of exclusion from a growing market which is already proving lucrative for a number of established and startup players. Smartphone vendors such as Research In Motion have already rolled out mobile payments services, while Apple is widely rumoured to follow suit eventually. Google has already launched its mobile wallet, known as Google Wallet, in the US, for Android-based smartphones, though the service is yet to be released globally.
Project Oscar could prove an enticing proposition to retailers by offering a single, standardised platform that is network- and device-agnostic. However, mobile payments are yet to reach critical mass among consumers, with commentators blaming slow uptake on fragmentation in the relatively immature space. Players from widely varying industries are offering different mobile payment services, utilising different technologies, such as near field communication (NFC), which enables contactless payments, and plug-in readers that enable connected devices to accept card payments. Nevertheless, analysts believe it is only a matter of time before the concept of mobile payment in its various guises pays off, with Gartner forecasting that global revenues for the market will top USD171.5 billion this year.