UK mobile payment JV may miss the Olympics

Feb. 20, 2012

An article from the U.K. Telegraph reported this weekend that plans for a mobile payment joint venture between the U.K.'s largest wireless carriers, Vodafone, O2 and Everything Everywhere, are running into regulatory hurdles that may delay its plans until after this year's London Olympic Games.

Missing the Olympics would be a big blow to the venture. The partner companies announced last year their plans to create a JV that gives U.K. merchants a "one-stop shop" for mobile marketing and payment services that would work across the three largest wireless networks. The post said the three telecom companies already have 30 people working on the JV, dubbed Project Oscar, but no chief executives yet.

The plan was to have the JV's services operational in time to show off the mobile payment and advertising network for the millions of visitors expected to visit London during the games. That plan is now in danger thanks to the European Commission.

According to sources, the new JV had expected to file necessary papers with EC regulators before Christmas but has still not done so. The EC has continued to request additional information on the plan.

A best case scenario would have papers finally filed sometime in the next two weeks with approvals around six weeks later, if regulators don't request even more information. In that best case scenario, a product launch, with a dramatically pared back product, might be ready in time for the London Games.

The Telegraph reported the best case scenario is unlikely. According to the paper's sources, regulators will likely require more evidence before green-lighting the venture, pushing the product's launch until late in 2012 and well after the games, which run from July 27 to Aug. 12.

This isn't the first regulatory issue faced by the U.K. mobile payment JV. Almost immediately after plans were announced, U.K. wireless carrier Three, the fourth largest wireless carrier, petitioned antitrust regulators in Europe to block the venture. Three alleged such a plan by carriers who own 90 percent of the U.K. market would effectively block any carrier not party to the JV from entering the mobile payment market.

"The Competition authorities in Brussels should not allow this type collaboration to go forward under any circumstances," said Three's legal counsel when the company filed its petition.

For more stories on this topic, visit the Regulatory research center.



Topics: Carriers / Operators , Contactless / NFC , Region: EMEA , Regulatory Issues

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