advertisement
advertisement
advertisement

This is page 4 of:

Google Wallet Struggles With Being Open, But On Only One Platform: Its Own

June 1st, 2011

The second reason to do so is what we’ll call the Gambler’s Choice. The most likely scenario is that there will be trials with Google and Apple running simultaneously. Within about 18 months, the market—consisting of that tiny subset of consumers and retailers actively involved in trials—will decide a preference. Unless the underdog fights back with a clever new twist, the market will rapidly gravitate to the victor. The loser will then agree to a deal with the victor, with very unfavorable terms, and one mobile standard will emerge.

Here’s the gamble: The retailers that happened to have chosen to trial with the victor will have a huge headstart on development. The losers? Not so much; but they’ll still be far ahead of the retailers that engaged in no trials. That makes choosing properly very important. Given that Google has announced and Apple hasn’t, retailers have no way of knowing exactly what Apple will offer. Therefore, retailers trying to make an informed choice between the two—between something that exists and something that doesn’t—have an almost impossible task. Let’s look at the partner list, though, for some clues.

Google’s primary payment partners are Citi, MasterCard, First Data and Sprint. The most conspicuous missing player is Visa, so there’s a fine chance it will be in the Apple camp. That’s huge. AT&T and Verizon are up for grabs, and Apple already has strong relationships with them. Being first gives Google some strength, but the potential Apple lineup is powerful.

When asked if Google Wallet would exist on other platforms, Stephanie Tilenius, Google’s VP for Commerce, said at a panel discussion this week that “this is an app that works on any phone, and there’s an NFC sticker that can be put on the back of the phone.” Although true, that’s rather misleading. The app might work on the iPhone, but it can’t get on the iPhone without Apple’s permission.

That’s akin to selling a bowling ball to a child. The child balks and says, “Why would I pay you for a bowling ball? There are no bowling alleys anywhere near here. I couldn’t use it.” The salesperson replies, “This bowling ball will work in the living room of every house on your street, including yours.” He just doesn’t mention the permission issue.

And then there’s PayPal. PayPal and parent eBay sued Google last week and specifically sued Tilenius and Bedier, both of whom used to work at eBay. The accusations are the usual, that the executives breached confidentiality agreements. But the lawsuit also makes it clear that PayPal, which said it had been negotiating a deal to handle payments for Google’s Androids until Google backed out of the talks, sees itself competing for payment attention with Google.

“Both PayPal and Google are currently offering their mobile-payment and POS technologies to major retailers for trial use,” the lawsuit filing said. “Although PayPal’s services and Google’s services are not mutually exclusive, at this stage it is unlikely that a retailer would invest time and effort in testing both companies’ products.”

Is it at all possible for the mobile-payment space to get any less tidy? I didn’t think so.


advertisement

Comments are closed.

Newsletters

StorefrontBacktalk delivers the latest retail technology news & analysis. Join more than 60,000 retail IT leaders who subscribe to our free weekly email. Sign up today!
advertisement

Most Recent Comments

Why Did Gonzales Hackers Like European Cards So Much Better?

I am still unclear about the core point here-- why higher value of European cards. Supply and demand, yes, makes sense. But the fact that the cards were chip and pin (EMV) should make them less valuable because that demonstrably reduces the ability to use them fraudulently. Did the author mean that the chip and pin cards could be used in a country where EMV is not implemented--the US--and this mis-match make it easier to us them since the issuing banks may not have as robust anti-fraud controls as non-EMV banks because they assumed EMV would do the fraud prevention for them Read more...
Two possible reasons that I can think of and have seen in the past - 1) Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code. 2) Also, in offline chip countries the card determines whether or not a transaction is approved, not the issuer. In my experience, European issuers haven't developed the same checks on authorization requests as US issuers. So, these cards might be more valuable because they are more likely to get approved. Read more...
A smart card slot in terminals doesn't mean there is a reader or that the reader is activated. Then, activated reader or not, the U.S. processors don't have apps certified or ready to load into those terminals to accept and process smart card transactions just yet. Don't get your card(t) before the terminal (horse). Read more...
The marketplace does speak. More fraud capacity translates to higher value for the stolen data. Because nearly 100% of all US transactions are authorized online in real time, we have less fraud regardless of whether the card is Magstripe only or chip and PIn. Hence, $10 prices for US cards vs $25 for the European counterparts. Read more...
@David True. The European cards have both an EMV chip AND a mag stripe. Europeans may generally use the chip for their transactions, but the insecure stripe remains vulnerable to skimming, whether it be from a false front on an ATM or a dishonest waiter with a handheld skimmer. If their stripe is skimmed, the track data can still be cloned and used fraudulently in the United States. If European banks only detect fraud from 9-5 GMT, that might explain why American criminals prefer them over American bank issued cards, who have fraud detection in place 24x7. Read more...

StorefrontBacktalk
Our apologies. Due to legal and security copyright issues, we can't facilitate the printing of Premium Content. If you absolutely need a hard copy, please contact customer service.