Tuesday, September 20, 2011

Google Wallet. The cards are in it.

Back in the year 2000, I saw a great presentation about the potential of the mobile wallet. The presenter was working with the world's largest handset maker at the time, and he gave a convincing mobile finance pitch: he pulled out his wallet and began pulling out one plastic card after another after another after another. The use case was clear: this mess would be cleaned up with an electronic wallet embedded in our handsets. The presenter assured the audience that within a few years, this would be the case.

So, here we are, almost a dozen years later, and such concepts of convenience haven't gotten very far. At least until today. Google has just rolled out its "Google Wallet" service together with U.S. operator Sprint via the Nexus S smartphone. The Nexus S is a vanilla Android phone, but Google did have the foresight to NFC enable the device, thus making it a good technology demo machine for mobile finance.

Eventually, a MasterCard, Visa, American Express and/or Discover card could be embedded in your device as well as many loyalty cards to be used at payWave- or PayPass-enabled point-of-sale terminals.

Will Google Wallet succeed? One thing is for sure: Google's timing is very good: the cost of NFC has come down considerably, and we can expect most mid- to high-end smartphones coming out over the next few years to be NFC enabled. And Android's critical mass could be the key driver: around 50% of new smartphones shipped run Android. But success is a double-edged sword, and the other major U.S. operators aren't so keen to give up this business development opportunity. Verizon, AT&T, and T-Mobile have their own mobile payment partnership project, ISIS. And Apple will likely give Google and the operators a run for their money with the iPhone 5.

So who will spark the mobile finance market for real? My money is on Google. They have the global reach, critical mass, adjacent services, and name recognition to pull this thing off. It's in the cards.



Juho Laatu said...

> My money is on Google. They have the global reach, critical mass, adjacent services, and name recognition to pull this thing off.

Just like Nokia had few years ago. I think also NFC was mature enough already then. I think the key to success is ability to understand and build a credible concept.

Google's track record shows that they might be able to do it. Apple's track recored is equally good, or maybe even better in physical gadgets. Neither of them is as dominant in the smart phone market as Nokia used to be. But maybe now it is the time to take this obvious step forward.

Peter Bryer: Mobile Foresighter said...

Hi Juho,
Agreed that getting the usability and offering down is critical. The track record of operators on such partnerships (like ISIS) tends not to be very good.

Google or Apple will get this working right. It's a shame that other major handset makers have lost out on this opportunity.

Android's market share isn't quite where Symbian's was at its peak a few years ago (65+%), but it's getting close.

srinath said...


watch this as well :-)