Google Wallet faces new competitors
A spate of companies such as Visa and Vodafone are jumping in, leaving Google Wallet behind.
The mobile wallet, or "m-commerce," is gaining traction, and competitors to Google's (GOOG) Google Wallet are lining up. Visa (V) and Vodafone (VOD) just became the latest to join the fray. The two companies announced a joint venture this week that will allow Vodafone users (initially only in Europe) to make purchases with their phones.
Isis, a joint venture of AT&T (T), Verizon (VZ), and T-Mobile (DTEGY.PK), announced a partnership with Chase (JPM), Barclaycard (BCS), and Capital One (COF) at the Mobile World Congress in Barcelona Monday. Ericsson (ERIC) also announced an m-commerce partnership with Western Union (WU) at the convention.
All of these players adopting the mobile wallet at the same time leave little room left for Google to leverage up its first-mover advantage. Google Wallet is innovative and well-liked, but woefully limited. It's only available on Sprint (S) Android smartphones, and only for Citi (C) MasterCard (MA) customers. With such a small customer base using Google Wallet, only a smattering of retailers supported the technology. Now that all of these other carriers and payment processors are jumping on the bandwagon, you can bet that you will be seeing near-field communication readers like MasterCard's PayPass in most stores pretty soon.
With support from all of these payment processors, it's more likely that near-field communication, or NFC, will become more pervasive. Samsung, HTC, Huawei, and Research In Motion (RIMM) are all including NFC technology on their phones.
Mobile payment will obviate the need for loyalty cards and coupons. Another potential area where this technology can be very useful is in transport systems. Japanese commuters have been boarding trains by merely tapping their mobile phones on turnstile-mounted card readers for years. New York’s Transit Authority has already dabbled with mobile Metrocards. When all subways and buses have the PayPass reader enabled, it could save riders the $52 million that they lose every year on unused and lost Metrocards and lower the cost of fare collection.
Isis and Visa mobile wallets are both expected to be available as early as this summer.
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