AT&T to Trial Mobile Payments for Online Shopping

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Mobile payments are starting to come to U.S. carriers in various forms after years of expectations, with AT&T announcing a trial with back-end service provider Boku a day after Sprint Nextel announced its Sprint Mobile Wallet.

The AT&T trial initially will involve using a mobile phone in conjunction with checkout pages on the PC-based Web. At online merchants that work with Boku, AT&T subscribers will be able to choose Boku instead of a credit card or other option to pay for digital content or virtual goods, said Boku spokesman David Speiser. After clicking on the Boku option, they will enter their mobile-phone number and then receive a text message to confirm the purchase. By answering the text message with "y," the subscriber will approve the payment. The charge will appear on the subscriber's phone bill.

Boku's stable of merchant partners includes major game vendors such as Electronic Arts, Playdom and FarmVille creator Zynga. AT&T will be the first U.S. operator to offer this payment option to its subscribers, though other carriers already offer older payment systems such as premium SMS through Boku, Speiser said.

Boku is also working on bringing payments to mobile applications. In June the company announced an SDK (software development kit) for adding a Boku payment option, called Paymo, to Android apps. An iPhone option is also in the works, Speiser said. With an entirely phone-based system, subscribers don't have to enter their phone numbers. It could be used to buy virtual goods or content within gaming and other apps, with the charge appearing on the next phone bill.

The AT&T trial will begin with just a subset of Boku's merchant partners, but within a few weeks all the participating companies will be brought in, Speiser said. Carriers outside the U.S., including Vodafone and Philippines operator Globe, already have commercially available payment systems operated by Boku.

Sprint's Mobile Wallet, coming next month, will be an application for making payments either in a store or online. Subscribers will be able to link the wallet to a variety of payment systems, including Visa, MasterCard, American Express and PayPal, and use a single PIN to authorize payment with any one of them. The initial group of merchants working with the Sprint Mobile Wallet includes game vendors Namco and Gameloft, and in-flight retailer SkyMall. Verizon and T-Mobile also are testing mobile payment systems, which could benefit carriers by giving them a role in new types of transactions.

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