Electronic Cash Via Wireless Phone, Smart Card In Works

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2-1-97. Contra Costa Times, Calif.:

Electronic Cash Via Wireless Phone, Smart Card In Works

Pleasanton, Calif. -- Wireless telephones are about to get a new mission as portable money machines.

Pacific Bell Mobile Services intends to test ways to blend its mobile phone technology with a smart card that can dramatically upgrade the intelligence of a wireless telephone. People on the go could transfer funds into the card's memory, slide the card into the phone, and then use the phone as a communications device to buy a variety of goods and services.

Pleasanton-based Pacific Bell Mobile is planning a test of the service in San Diego sometime in the first half of 1997, said Roy Gunter, the company's executive director of business development. Pac Bell Mobile in November began offering personal communications services a new form of wireless communications in San Diego.

"We want to add the ability to exchange cash, both from one phone to another, and between vendors or retailers," Gunter said. "People could conduct transactions from any location."

Customers could buy items from an Internet site or directly from a merchant.

"All the information is stored in the electronic smart card, the same size as your credit card," Gunter said. "The phone just becomes the reader and the communications device."

If the trials proceed smoothly, Pacific Bell Mobile probably will launch a commercial version of the service in 1998.

"The appeal for this technology could be very high for mobile professionals," said Christopher Landes, analyst with TeleChoice Inc., a Verona, N.J.-based market researcher. "Eventually, this could appeal to consumers." First, though, the average person would have to be convinced that cash information can be handled securely over a wireless network.

Pacific Bell and analysts envision several ways people can use wireless phones as mobile cash terminals and the smart card as a data storage device:

+ While driving to the airport, people could make reservations, pay the airfare and have the tickets waiting at the terminal.

+ Customers could electronically pay tolls before getting on a bridge and zip through toll plazas without stopping.

+ A phone user could buy flowers or other products and have them delivered while traveling.

Also, data such as emergency health-care information could be stored on the smart card, Gunter said.

"We are talking to the credit-card industry, the wireless phone industry, about providing us what we need to deploy this technology," Gunter said.

Nokia, for example, sells an intelligent wireless phone using technology from Alameda-based Geoworks Inc. Visa and Mastercard could provide their expertise in processing financial transactions.

"As I travel, I would like something to handle all the ways that I communicate as well as to let me manage transactions," analyst Landes said.