Google Steps in To Fill Void in Mobile Payment Industry
Posted by Matt Krautstrunk on June 2, 2011 in Business News, Phone Systems [ 2 Comments ]
Just when you thought mobile payments were down and out, Google steps up to the plate. Google recently announced its NFC technology embedded in their Android Smartphone OS that turns the devices into an electronic wallet.
A few weeks back, it was announced that mobile carriers backing the most promising NFC player, Isis were scaling back their support. According to Mobile Marketing Watch, AT&T, Verizon and T-Mobile are losing faith in Isis because of it’s lack of bank support. “Simpler mobile payment solutions in line with the so-called “mobile wallet” framework now appear to be the widely embraced mechanism by which the consumer shopping experience will be revolutionized.”
Mobile payments and mobile wallets are technology solutions that allow consumers to pay for goods in a store with their cell phones. This technology was once touted the “future,” has hung in the balance the past few years as suppliers struggle to align, credit card companies, mobile phone carriers and retailers in to one phone system. Being able to pay for goods without a wallet can be a huge game changer for small businesses and mobile carriers.
Now has never been a better time to announce a mobile wallet. Google may step on some toes by being first to market, but they are probably the best company to test and rollout a technology with so many regulations and intricacies. The Google Wallet will work with a few key retailers, including, “Macy’s Inc., American Eagle Outfitters Inc. and the Subway fast-food chain. Retailers that participate in the program will have upgraded terminals at the point of sale that can read the mobile devices and provide special offers.”
Google has a slightly different business model than Isis. Isis would potentially work to take a fee from each transaction made with their service. However Google would use its mobile wallet to expand its advertising platform. They also have a more feasible integration strategy, according to Internet Retailer, “Google is relying on the existing payment system structure, which includes card-issuing banks, payment processors and payment networks, for Google Wallet transactions, Forrester says. “With this approach, Google is protecting these partners against mobile payment disruption,” Forrester says.”
It also seems that Google already has a leg up. We’ve heard about Isis for years now, but have never seen anything. Google already has a partnership with Sprint to work with the only NFC enabled phone Nexus S. Isis on the other hand has rather stagnant advances with the technology and doesn’t have any plans for trials until mid 2012.
Now, whether consumers will embrace the technology or not will remain to be seen. Google definitely has a leg up on the competition in the mobile payment industry thus far. However concerns about privacy and reliability of apps may be a huge barrier of adoption to the mobile payment industry, something that Google can probably handle with ease.
Image Credit: Ultra Sum