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“Total Moontalk.” Google’s Fictional Challenge to Visa and MasterCard
Google’s financials for 2009 starkly point out that 97 percent of revenues come from advertising. Everything else makes up 3 percent. Now, if you were Google, would you consider how to further develop the services that make you the most money, or would you decide to dabble in a highly competitive legacy industry where the constituents fight for scraps of interchange and transaction fees?
And to clarify the NFC (near field communications) announcements:
Nothing here indicates that Google is planning to become a retail payment brand, but a lot indicates that the company plans to extend what it does best to the physical world. With an NFC-enabled phone and a store displaying NFC tags, the act of tapping the phone on the tag provides physical evidence that the consumer was at that physical location at that specific time. For Google, this approach is a direct transcription of its existing Internet-based business of click-throughs on Web advertisements. In the physical world, the phone becomes the mouse.
The unfortunate fact is that the payments and retail industries see mobile money through the lens of the markets in which they operate. When Google mentions mobile money and NFC, though, it obviously means payment card replacement. Indeed, it is likely that Google will facilitate mobile payments for third parties with NFC support on its devices. But this support is just gravy for the company. Both the definition of mobile money and the capabilities of NFC are much broader than the industry recognizes. Please reach out to me and share your thoughts.
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.
-Marc
