BlackBerry maker Research in Motion is in a scuffle with AT&T and T-Mobile over control of mobile-payment data, which could determine whether handset makers or wireless carriers dictate the terms of a lucrative $1.13 trillion industry.
most of its devices, is tussling with AT&T and T-Mobile over where key customer data will reside -- on the phone itself or on the SIM card.
That may not sound like much, but the implications are enormous. That data, which is stored in the magnetic strip on credit cards, will determine who controls the customer, and the revenue from transactions to merchants when the device is waved over an electronic reader during checkout.
AT&T and T-Mobile want to encrypt the information on their SIM cards, small chips that communicate with its wireless networks, but RIM wants those credentials to be stored on its BlackBerry device.
Consumers would ultimately be better off if the carriers win, since they can swap their SIM card from phone to phone. Should RIM prevail, customers may be tied to their BlackBerry smartphones, which would potentially cut carriers out of the loop.
RIM has already made the first move and reached out to banks to bypass the carriers, people familiar with the matter said. But AT&T and T-Mobile are part of a consortium of 800 wireless operators around the world, known as the GSM Association, or GSMA, that is racing to standardized mobile-payments system.
Verizon and Sprint, which use a different technology called CDMA, hasn't been involved in the dispute, because its network doesn't use SIM cards. But those wireless carriers could upgrade their networks to a 4G technology known as LTE, or Long-Term Evolution, which does.
"Many if not most of BlackBerry devices throughout the year will have NFC in them," RIM's co-chief executive Jim Balsillie said at the Mobile World Congress in Barcelona last week.
Meanwhile, rivals Google and Apple are making their moves as well. Google has already released its Nexus S smartphone with built-in NFC, while Apple decided to hold off on mobile-payment on the iPhone 5 until the technology is more mature.
In December, Google bought Zetawire, secretive mobile-payment startup. The company will test its mobile payment systems in New York and San Francisco in the next four months.
Whoever dictates the standards of mobile payment stands to gain the most of a lucrative $1.13 trillion industry.
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