Magnetic cards will surely be around for a long time, but the second NFC comes out on the iPhone 5 (or 6), which Apple has hired a lot of NFC engineers for, I think it will be the thing to have for all merchants. And many do already - my BofA card has an embedded rfid which I have used at a lot of places with non swipe readers. They have been widely used in Japan for the last decade.
My point is the playing field will be much more open, because it will be only a software solution, not a hardware+software solution which has more barriers to market - There could essentially be a Visa merchant app that accepts payments from other phones.