Isis progress: 2/3 of users have inputted card info, make 6-7 transactions per month

Two-thirds of Isis' users have installed at least one payment card into their Isis wallet, the mobile payments company said, and that group of users makes an average of six to seven NFC-based financial transactions per month.

isis nfc iphone Incipio

Isis now supports iPhone via an NFC case from Incipio.

The figures are some of the first released by Isis, the mobile payments joint venture from  AT&T Mobility (NYSE:T), Verizon Wireless (NYSE:VZ) and T-Mobile US (NYSE:TMUS), since the offering launched nationwide in mid-November.

"The usage that we're seeing from some of our partners is very encouraging for them and very encouraging for us," said Jaymee Johnson, Isis' head of marketing. Johnson declined to provide the total number of Isis users. "So far so good. It's where we want to be."

Johnson also said that Isis' promotional efforts have also enjoyed success. He said that the company's promotional offering through Toys "R" Us during the holidays, which offered $15 back on purchases over $30, was the toy retailer's "most effective digital coupon campaign they have ever run."  He also said Isis' partnership with Jamba Juice is successful: "They continue to see very strong results from that."

Isis' NFC-based mobile payments service is now supported on 60 smartphones. Perhaps more importantly, virtually all of the new payment terminals that are sold to stores and other retailers today can support NFC payments. Industry watchers estimate that merchants on average upgrade or replace their payment terminals once every seven to 10 years, which means that in the coming years virtually every payment terminal that today supports standard credit card payments will in the future support NFC-based payments.

Isis' service relies on a "secure element" inside a smartphone that stores users' credit card information. Isis users can make payments with participating retailers and banks (Wells Fargo, Chase, American Express and others through American Express' Serve technology) by tapping their phone on a payment terminal.

Interestingly, Isis officials also argued that the company's NFC-based payment service is more secure than standard credit card payments using the card's magnetic strip. Scott Mulloy, Isis' CTO, said that the recent hacking of Target, which included information on more than 40 million payment cards, wouldn't have affected Isis users because of the design of the company's technology. He said each Isis transaction uses a separate authorization code, which prevents a hacker from being able to steal credit card information, as in Target's recent security breach, and use those credit card numbers to make additional purchases.

"The data breach would have happened," Mulloy explained, "but the ability to commit fraud--you can't make that next transaction."

Mulloy also addressed the new Host-Card Emulation NFC payments technology that was recently endorsed by Visa and MasterCard. HCE is a cloud-based payment service that bypasses the secure element embedded in the hardware of a phone that forms the basis for Isis' service. Industry analysts see HCE as a method companies could use to bypass Isis and other, similar payment technologies, thus rendering them obsolete.

However, Mulloy argued Isis and other hardware-based mobile payment technologies that rely on a secure element could work alongside cloud-based payment systems like HCE. "I think in many ways HCE and a hardware solution are very complementary," he said, adding though that he believes hardware-based technologies like Isis are more secure than cloud-based technologies like HCE.

Moreover, Mulloy said that Isis is considering using HCE technology to store users' loyalty card and coupon information. He said this data doesn't need as much security as a user's credit card information, and so Isis might consider storing loyalty card and coupon information in the cloud via HCE instead of in the device's secure element. He said the secure element has a limited amount of space, while an HCE system could store an almost limitless amount of data, and therefore an HCE system might make more sense for a user who collects lots of loyalty cards and coupons. "I'm investigating HCE" for loyalty cards and coupons, Mulloy said.

Further, Mulloy said Isis would consider supporting HCE directly for credit card payments if banks decide they want to use the technology. "If we need to bring that into the wallet as well, it's something that we'll look into," Mulloy said of HCE.

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