[Domenic_S]

I don't know if that's true. Say we lived in a world where those regulations didn't exist and the fraud risk was on par with what it is today. If one bank introduced their own fraud protection program, wouldn't they basically capture 90% of the market overnight?

[JadeNB]

This is a good argument, but I'm not sure that I buy this. There are plenty of industries (I think of the cable and cell-phone industries, but I'm sure there are others) where it's just a given that the service will be crappy, even though one company that started to respect its customers could seemingly corner the market. (I'm not sure what are the results of T-Mobile's exercises in respecting its customers. Their unfortunate net-neutrality stance with Binge On means that it's not an unalloyed win to go with them.)

[Domenic_S]

I get what you're saying, but credit cards are unique: the advantage credit card companies have over those other industries is that there is essentially no lock-in, and your old cards continue to work while you're in the process of switching eg your autopays over. It's a very switch-friendly industry.

Remember when you couldn't take your cell phone number with you and so pretty much nobody switched carriers? It was a massive pain. Now it's easier than ever to switch, except most people are locked into multi-year contracts. Switching friction = high, but not impossible. As you said, TMO is trying to compete here.

Cable has monopolies on towns, so there's 0 incentive. People couldn't switch even if they wanted to. I suppose there's satellite, but you'll still be paying the cable company for internet -- they get their pound of flesh no matter what. Switching friction = impossible.

[JadeNB]

These are good points. My remark was off the cuff; it's clear that you've thought (or at least are thinking) about it much more deeply.