By Sinead Carew
AT&T Inc. said on Tuesday it has taken a step toward the long-promised
notion of phones replacing credit cards, checks and cash by signing
agreements with Wachovia Corp. and several other banks.
The agreements will allow customers of its Cingular Wireless arm,
which is being rebranded as AT&T, and participating banks to manage
their accounts and pay bills electronically by using an application on
their cell phones.
While the use of mobile phones for transactions is in its nascent
stages in the United States, such services are already available in
parts of Europe and Asia.
In Japan, people commonly shop with their mobile phones by just waving
their handset instead of swiping credit cards.
Along with Wachovia, U.S. banks such as BancorpSouth Inc. Regions
Financial Corp. and SunTrust Banks, Inc. are offering mobile banking
to AT&T customers.
With three of the top U.S. banks in tow, Cingular is now in talks with
the rest with an aim to signing them up in the next 12 to 24 months,
said Jim Ryan, the company's data services vice president. He said the
service needs more banks to participate in order to be successful.
"We believe that a significant number of people are interested in
being able to do this with their phones," Ryan told Reuters at the
sidelines of the CTIA wireless show. "To make it work all the banks
need to really agree to the logic."
AT&T, having tested mobile banking last year, has said it will not
charge extra for the service but expects it to attract more users to
its wireless Internet service and potentially help it add new users
and keep existing ones.
And as enough consumers begin to use their phones to check their
balance before a transaction, the next step for Cingular would be
using phones to replace credit cards.
"In the next 12 months it's reasonable to expect we'll have a platform
of devices that offer real-time transactions," Ryan said. Cingular has
tested Nokia phones with short range radio links that enable wireless
payments as the user waves the phone by a device like a credit card
Mobile banking is part of an effort by wireless companies around to
world to boost their revenue and customer loyalty by convincing
subscribers to use phones for everything from Web browsing and text
messaging to playing music and video.
AT&T said customers can download software from privately held
Firethorn Holdings LLC onto their phones. AT&T plans to include the
software in new handsets in the second half of this year and is
planning a multimillion-dollar ad campaign.
Firethorn is also acting as an intermediary between AT&T and the
Wachovia operates in 21 U.S. states, while Regions operates in 16
states in the Midwest and South, including Texas. SunTrust provides
banking in Southeast and Mid-Atlantic states and BancorpSouth operates
in eight U.S. states.
AT&T Chief Operating Officer Randall Stephenson also said at CTIA that
wireless and fixed-line services would eventually combine. "I'm
confident that in the not too distant future the concepts of having
different handsets for different networks ... will be seen as quaint,"
For example, cell phone video conference services that AT&T plans to
launch in 50 markets this summer could eventually work in conjunction
with video conferencing on television screens and desktop computers.
He saw mobile video representing as dramatic a change as the
replacement of black-and-white televisions with color.
To illustrate the growing ubiquity of mobile phones around the world,
Stephenson said that while four babies are born every second in China,
about 25 people are signing up for wireless services in the country.
Copyright 2007 Reuters Limited.
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