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AT&T (NYSE: T) brought its customers one step closer to the promise of mobile 
banking Tuesday when it announced partnerships with BancorpSouth and a number of other banks to offer banking capabilities to wireless users.
Customers of the participating banks who subscribe to AT&T's wireless service can download a mobile banking application directly to their cell phone. From there, they can view their account balances, transfer funds between accounts, and receive and pay bills, much the way they have long been able to using a home PC.
All information on the application is password-protected and encrypted for security assurance, AT&T officials said.
In addition to BancorpSouth, other participating banks include Wachovia, Regions and Suntrust Bank. The banking application is from Firethorn Holdings, which also acts as an intermediary between AT&T and the banks.
"At BancorpSouth, a key emphasis is on offering our customers convenient, time-saving new ways of managing their money," said Aubrey Patterson, BancorpSouth's chairman and chief executive officer. "That is why we were the first financial institution to participate in a trial of mobile banking with AT&T and Firethorn, and that is why we are now making this application available to all of our customers."
A Step in the Right Direction
"Big developments in wireless often start with a seed," said Jim Ryan, vice president of data services at AT&T's wireless unit. "For example, until just a few years ago, text messaging was a novelty, and now it is pervasive and hard-wired into our behavior. We believe that mobile banking will rapidly move up a similar curve of mass adoption with AT&T's 61 million wireless customers."
The new application certainly gives new capabilities to wireless customers and brings the U.S. market closer to capabilities already offered in many parts of Asia and Europe, where cell phones are commonly used instead of credit cards or cash. However, the move may be only an incremental step in the right direction.
"What's really exciting is using cell phones as credit cards to pay for gas, groceries and other purchases," Allyn Hall, director of wireless for In-Stat, told the E-Commerce Times. "This is only a small step in the right direction. In truth, there's nothing you can do here that you couldn't do before, if you had Internet access from your cell phone."
'Not Exactly Revolutionary'
The Firethorn software will undoubtedly make mobile banking easier than it was before, but overall Hall said the announcement is "not exactly revolutionary."
"This is only part of the conversion of the cell phone into a full-fledged financial device -- the other part will be using it for actual transactions," agreed Rob Enderle, principal analyst at the Enderle Group.
Part of the reason other countries are so far ahead of the United States in this respect is because of a "classic American problem," Hall pointed out. "Unlike countries like Japan, in which companies cooperate on standards and then compete afterwards, here in the U.S. we compete on standards," he said.
The result is that "in the U.S. we're paralyzed -- we can't agree on how to share the wealth or even on standards," Hall continued. "Five years from now we could easily still be stuck in this same place."
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