Isis mobile payment service hits snag, delays trial run

Isis was supposed to have turned on the mobile payment systems in two cities by the end of summer.

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Roger Cheng (he/him/his) was the executive editor in charge of CNET News, managing everything from daily breaking news to in-depth investigative packages. Prior to this, he was on the telecommunications beat and wrote for Dow Jones Newswires and The Wall Street Journal for nearly a decade and got his start writing and laying out pages at a local paper in Southern California. He's a devoted Trojan alum and thinks sleep is the perfect -- if unattainable -- hobby for a parent.
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Roger Cheng
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Google Wallet getting tested out in a store in Manhattan. Isis won't be coming here soon. Roger Cheng/CNET

Isis won't be launching its mobile payment trials at the end of summer.

Isis, which is a joint venture between Verizon Wireless, AT&T, and T-Mobile USA, told CNET today that it was delaying the start of its trials, which were scheduled to start this month in Salt Lake City, Utah, and Austin, Texas.

Isis is one of several parties attempting to roll out a broader system of mobile payments, which would enable you to purchase goods and services by waving a smartphone at a cash register, subway turnstile, or inside a taxi. Unlike a higher profile launch of Google Wallet, which is out in select markets, Isis has chosen to take its time to ensure all of its pieces work together.

"Our focus has been on making sure when we launch we do it properly and do it right," said Ryan Hughes, head of marketing for Isis, in an interview.

Hughes declined to explain why the project was delayed, only saying Isis was going through a "punch list" of objectives and that the wait wouldn't be too long. He added he would be back in October with additional "market momentum news."

Isis isn't changing its plans to become a service provider that would allow banks, payment networks, and merchants run on top of its system, Hughes said. Rather than take a cut of each transaction, the business would charge a fee for use of the platform.

"The task we undertook was a fairly complex one," he said, adding, "we're not experiencing any major issues."

The idea of mobile payments has attracted large number of companies, from Visa to PayPal, all with their own take on how they should run. Many, although not all, have agreed upon a technology called NFC, which allows for the tap-and-pay function.

While a number of high-profile smartphones, including the Samsung Galaxy S III, use NFC, a notable exception is the iPhone. The current iPhone 4S lacks NFC, as does the iPhone 5, which was unveiled yesterday. An NFC-enabled iPhone would have done wonders for the adoption of mobile payments.

But the iPhone 5's lack of NFC isn't a setback, Hughes said. The carriers have the ability to release other phones with the technology. Isis is also working on a sleeve that allows users to bundle an NFC chip with the iPhone.

Hughes doesn't believe that the industry will turn to mobile payments overnight, and isn't concerned about one phone -- even as high-profile as the iPhone -- will change the adoption over the long term. Google Wallet, for the all the buzz that it enjoyed after its launch last year, has only seen slow user adoption.

"These things take time," he said.