Google says mobile payments growing fast but won't catch on overnight
It will take three to five years for the technology to become common in the U.S., a Google executive said
IDG News Service - Mobile payments with Google Wallet are growing fast, but the road to wide acceptance of NFC in the U.S. will be slow, the head of Google's payments unit said Friday.
The number of NFC (near-field communication) transactions with Google Wallet doubled in the first six weeks after the Aug. 1 launch of a cloud-based version, and that trend has continued, said Osama Bedier, Google's vice president of wallet and payments, in a session at the Global Mobile Internet Conference in San Jose, California. He didn't say how many payments that is, however. Google has never quoted an exact number of transactions, and Bedier stuck to that practice.
"We feel like we're making a huge difference on transaction volume," Bedier said in an on-stage conversation with Rajeev Chand of investment bank Rutberg & Co.
However, mobile payments won't be an overnight success, he said. "We didn't think NFC was just going to happen in a single year. This is a three-to-five-year game," Bedier said.
U.S. consumers have shown limited interest in mobile payments because the country has a well-developed credit-card ecosystem, analysts say. Payments with NFC require hardware and software in both handsets and point-of-sale terminals. In addition, there are three systems competing, each with a different set of strong backers.
In addition to Google's NFC payment technology, part of its overarching Google Wallet program for virtual wallets, there are systems being promoted by big mobile operators and by retailers. The ISIS consortium, which includes AT&T, Verizon Wireless and T-Mobile USA, plans to launch its platform in two cities on Monday. In August, a group of stores including Walmart, Target and 7-Eleven formed their own mobile payments network, Merchant Customer Exchange.
"The problem is, there's a lot of ideas and not a lot of problems being solved," Bedier said. "There's room for multiple solutions ... but each solution has to have a value proposition."
Any good mobile payment system needs to help consumers save time and money, make purchases seamless, and work everywhere, Bedier said.
Google enabled NFC in its Android OS in 2010 and was an early adopter of NFC chips in its own handsets, but the company is still looking for support from more mobile operators, according to Bedier. The ball is in their court, he said.
"To make NFC successful, the carriers should come along," Bedier said. "I think we've been very reasonable ... but they have to see eye to eye with us on the approach."
Bedier still expects NFC to catch on in the long term. "I do believe, five years out, you'll have NFC in almost every phone and almost every terminal," he said. When that happens, checkout lines will start to disappear as shoppers will be able to complete at least half of their store purchases without going to a checkout counter, he said.
- Silicon Valley's 19 Coolest Places to Work
- Is Windows 8 Development Worth the Trouble?
- 8 Books Every IT Leader Should Read This Year
- 10 Hot Hadoop Startups to Watch
- Slideshow: 7 security mistakes people make with their mobile device
- iOS vs. Android: Which is more secure?
- 11 sure signs you've been hacked
- Data on the Move = Business on the Move; How Strategic Secure Managed File Transfer Adds Value and Drives Business This whitepaper describes the formal and informal file-sharing methods business employees use to perform their daily functions and explains that, from sending small...
- Infographic: Converged Infrastructure Benefits This Infographic quantifies the savings organizations are realizing from increased deployment speed, higher availability, and lower annual costs.
- CIOs Deliver Productivity Breakthroughs with Intelligent Digital Signage Retailers have long recognized the influence that digital signage provides over a shopper's point-of-purchase decision making process.
- Going Paperless? Here's What You Need to Think About As makers of some of the world's most popular PDF solutions, we often consult with businesses & governmental agencies that have the goal...
- Supercharge Your Web and Mobile App Development with High-Productivity Hybrid Cloud Webinar: Hear from industry experts about the amazing power at the intersection of next-generation web and mobile application development and cloud platforms.
- Top 4 Digital Signage Fails Join RMG Networks for a look at four of the most common reasons digital signage fails in corporate businesses. Learn about strategies to... All Internet White Papers | Webcasts
Our new weekly Consumerization of IT newsletter covers a wide range of trends including BYOD, smartphones, tablets, MDM, cloud, social and what it all means for IT. Subscribe now and stay up to date!