Having already sufficiently changed the way you look up information, Google is now seeking to revolutionize how you pay for things.
The company on Monday night formally unveiled its long-awaited Google Wallet app, but it’s only going to be available on the Sprint Nexus S 4G Android smartphone to begin with.
Also, for the time being, it only works at retail locations that are part of MasterCard’s PayPass network. There are 140,000 such PayPass retail locations throughout the United States, USA Today reports. Find the nearest PayPass equipped location using this locator from Google.
In a post on the Google Blog, Omar Bedier, vice president of payments, wrote:
Google Wallet enables you to pay with your Citi MasterCard credit card and the Google Prepaid Card, which can be funded with any of your existing plastic credit cards. As a thanks to early adopters, we’re adding a $10 free bonus to the Google Prepaid Card if you set it up in Google Wallet before the end of the year.
Bedier also noted that “Visa, Discover and American Express have made available their NFC specifications that could enable their cards to be added to future versions of Google Wallet.”
NFC stands for “near field communication,” a burgeoning two-way technology that allows mobile devices to transmit and receive short bursts of data at close range using magnetic-induced radio wave fields.
The technology is already popular in Japan and South Korea, where customers have been paying with products using their mobile phones for years, and companies besides Google are gearing up to make inroads in Europe, while Google eyes bringing NFC to China.
It’ll face an uphill climb stateside though. As MobileMedia reports:
With Wallet, Google joins a field of competitors vying for dominance in the emerging mobile payments market. Services and solutions ranging from Square’s system for Apple devices to PayPal to the Isis consortium of mobile carriers and credit card companies now jockey for a piece of a market estimated to be worth $1.13 trillion a year by 2014, according to Gartner.
Google Wallet, however, faces the same limitations preventing wide adoption of mobile payments technology that other rivals contend with. Many solutions, including Google’s, rely on NFC, a relatively new technology dependent on a complicated network of partners to implement. Much of the infrastructure has not been laid in place for services like Google Wallet to scale rapidly yet.
Google is entering competitive market. Square, a company founded by Twitter co-founder Jack Dorsey for example, produces a mobile phone credit-card reader extension that has already made inroads across the country (not just in tech-savvy urban corridors on the coasts), reporting 500,000 devices shipped and 1 million transactions in the month of May.
Google’s previous experiment with mobile commerce didn’t go so well. It killed off a competing mobile payments service in the form of its QR code initiative for Google Places. QR or “quick response” codes are another popular international mobile payments and information retrieval technology – this one that uses a phone’s camera to detect digital barcodes – that has yet to catch on in the U.S. Google launched the product in 2009 with much fanfare, promising it would allow consumers to get virtual coupons for selected merchants. But by March this year, the company had discontinued QR support in favor of NFC. As The International Business Times reported:
The company is phasing out the technology in favor of near-field communication, which would offer much of the same functionality as QR codes but with increased efficiency. Instead of pointing their phones at QR codes and waiting, users will be able to wave their phones over NFC chips embedded in signs and devices.
However, in the United States, the test remains not only whether Google can convince customers here to trust it with their credit card information and payment history, but also to spur a new payment system while maintaining an edge over competitors and keeping in line with federal regulators.
Regulators and legislators are keeping a close eye on Google. Former Google CEO and current Chairman Eric Schmidt set to testify in front of the Senate antitrust subcommittee Wednesday.
