Google wants to launch “revived” version of Wallet at Google I/O – WSJ
Google had a big start in mobile payments, but it’s now scrambling to offer a coherent answer to Apple Pay, a service that’s just months old, but is already dominating contactless payments. And that’s a problem for Google, not because payments are a big money-maker, but because a successful Apple Pay could sway many Android users to the other side. However, Google isn’t giving up just yet.
According to the Wall Street Journal, Google plans a “revived” version of its Wallet payment service, that it hopes to officially launch at Google I/O in late May. For this Wallet 2.0, so to speak, Google is trying to bring together an “unruly coalition of device makers, wireless carriers, banks and payment networks,” says the report, which cites people familiar with the matter. In order to coax partners into the new scheme, Google is willing to give them a larger share of the revenues, a sign that Larry Page’s company is determined to make it work this time.
Google seems determined to make it work this time.
Apple is not paying carriers anything for Apple Pay; it doesn’t have to, because it tightly controls what goes on its devices, as opposed to Google, which has little say in this area. So Google is willing to cut a deal with carriers and give them a fee for each transaction. Google is also in talks with banks and payment operators including MasterCard and Visa – having these two giants on board would give Wallet massive reach throughout the US and the world.
Google is also talking with device makers, of course, but the biggest Android OEM may not find it in its interest to support the new Wallet. Samsung just bought LoopPay, whose mobile payment system works with the omnipresent magnetic card readers without requiring NFC. LoopPay is expected to be one of the key features of the Galaxy S6, due next week. But even if it bets on LoopPay, Samsung may find it worthwhile to support Google’s extended Wallet, out of caution or to maximize compatibility.
Google’s chief business officer Omid Kurdestani hinted last month that Google would release a “fully functional payment system” that goes “beyond just tap and pay” this year. It’s possible that the executive hinted at the revamped Wallet, but he may have also referred to Plaso, the Bluetooth-based mobile payment system that The Information first reported on last week. Google has also been rumored to have shown interest in buying Softcard, the payment service developed by AT&T, Verizon, and Sprint. Ironically, Softcard (formerly Isis) was the reason US carriers did everything they could to stop the adoption of Wallet.
It looks like Google is finally serious about payments, and we may have Apple to thank for that. It remains to be seen whether Google will be able to iron out all the issues for a Google I/O launch.