`Mega’ Payments Race Pits Google, Visa Against Phone Operators

Deutsche Telekom AGFrance Telecom SA and other mobile operators, who lost the battle for online applications stores to Apple Inc. and Google Inc., say they have a fighting chance of winning the corner convenience store.

The operators, along with Google and credit card providers including Visa Inc., are scrambling to offer so-called near- field communication payment systems, which will let people buy everything from milk and butter to clothes with a swipe of their smartphone. NFC may be the last chance for operators to avoid being simple conduits of other companies’ electronic commerce.

“Google’s massive, but Google does not have a billing relationship with 99 percent of its customers,” Deutsche Telekom Chief Technology and Innovation Officer Ed Kozel said in an interview last week. “That’s our opportunity.”

The stakes for losing out on this business development are huge, with NFC payments — which could potentially replace many cash registers and credit cards — likely to account for a third of the $1.13 trillion global market in mobile transactions by 2014, according to IE Market Research.

Operators, who “were not as good as the Internet players” for online apps, have an opportunity to get back in the game, said Philippe Vallee, an executive vice president at SIM-card maker Gemalto SA. With NFC, “they can become the applications portal for the secure wallet.”


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