AT&T, Verizon, T-Mobile Engage in Multimillion Dollar War with Google

A major war is brewing in mobile, according to a new report from Bloomberg.

And it’s a battle that the otherwise rival wireless networks plan to win.

Verizon Wireless, AT&T, and T- Mobile USA are reporting planning to spend upwards of $100 million in their joint venture allowing mobile users to pay for goods and services directly from their smartphones.

The investment sets up a showdown between the venture, known as Isis, and rivals like a mobile-payment service from Google Inc. The amount of funding depends on how successful Isis is at attracting banks and merchants, said one of the people, who asked not to be identified because the financing is private.

The mobile payments market is on pace to reach $670 billion by 2015, according to Juniper Research says. The carriers are determined to “catch up with Google.” The Internet search giant raised the curtain on its own mobile-wallet service in May.

“Over the long haul, operators have to create new businesses that derive value from more than access,” says Chetan Sharma, an independent wireless analyst. “It’s a given that people are going to be transacting more over cell phones. It could open a potential new revenue stream for them.”

Worldwide mobile payments are expected to generate $240 billion in 2011.