Verizon Wireless, AT&T Inc. and T-Mobile USA will unveil more details on their joint venture to create a mobile payment network, which will be financially backed by Barclays PLC and Discover Financial Services, as soon as Tuesday, according to people familiar with the situation, Dow Jones is reporting.
The joint venture will be lead by Michael Abbott, formerly chief marketing officer at General Electric Co.'s GE Capital division. Discover and Barclays will also officially announce that they are participating in the venture. A formal announcement can come any time between Tuesday and Thursday.
In Abbott, the joint venture gets a neutral executive without any baggage from the telco side, critical given the carrier's natural reluctance to work with each other.
But the rare showing of cooperation between three of the four national carriers creates a potentially large base of users for its mobile payment system. The carriers are eager to move into mobile transactions because it represents a new revenue stream and another feature that get its subscribers spending more time on their phone. Discover benefits from additional financial transactions over its credit-card network, and Barclays gets a foot in the door of the U.S. consumer market.
The telco joint venture comes as major credit card companies such as Visa Inc. and Mastercard Inc. are pushing their own mobile payment initiatives. In July, American Express Co. hired Dan Schulman, who was the architect of Sprint Nextel Corp.'s prepaid wireless strategy.
The divergent paths underscore the tension over who controls the mobile payment network, how the revenue is divided, and which party shoulders the financial and legal burdens.