Google Wallet is stronger without NFC

Thursday 26 September 2013 | 14:52 CET | Background

Google has revamped the Google Wallet app. Although NFC is still supported, it's joined by the more conventional method of barcode scanning, making it more relevant in today's market. Google has also built an app for iOS and will integrate Google Wallet with other services, such as Gmail and Maps, both for consumers and merchants. Google Wallet was announced over two years ago but has only limited reach.

Google Wallet was launched in Q4 2011. Users can use the service to store multiple credit cards or make payments from the Wallet Balance, view shopping history and receive offers. It also offers online checkout, comparable to PayPal. The online checkout service was previously known as Google Checkout but has since been integrated into Google Wallet.

The Google Wallet NFC-services are available with US mobile network operators Sprint, US Cellular and MetroPCS. While Sprint is the number three with national coverage, US Cellular is a regional player. MetroPCS was acquired by T-Mobile USA recently and will be integrated over the next two years, which could spell an end to Google Wallet support. In any case, the CDMA network will be turned off, and the NFC services with it.

Google Wallet with NFC works on selected Android handsets bought from these three CDMA operators, as well as on Nexus devices. It will not work on any other (Android or other OS) handset, including identical phones bought unlocked, or any other mobile network.

National carriers Verizon Wireless, AT&T and T-Mobile are currently blocking Google’s NFC services, which is a competitor to their own ISIS Mobile payment ecosystem. Given this lack of reach, it’s not surprising Google Wallet failed to gain traction so far with merchants and consumers at point of sale.

The newly updated app shows a different story. It's available on any smartphone running on Android 2.3 or higher, or 97.6 percent of the active user base, according to figures released to the Android community. Google Wallet is now available for iPhone iOS 6 or 7, or pretty much every iPhone still in active duty.

These users can use the app with a more conventional interface: they can scan a loyalty card or code or type the unique number manually. They can show the card or redeem a coupon by bringing it up on the phone screen and having it scanned at the counter. The apps are also capable of using the smartphone location to have nearby shops send offers.

Google has built a platform that allows vendors to integrate their loyalty programmes and coupons directly into the Google Wallet cloud, but also into a growing number of interlinked Google services. Companies can advertise on Google Search, Gmail, Google Maps, Google+. Users can activate coupons in any of these environments and they will show up in Google Wallet.

Gmail will be expanded with a payment service linked to Google Wallet. The ‘attach money’ button will be comparable to sending an image.

Google Wallet NFC, the Pay with Gmail option and the iOS app are only available in the US for now. Google Checkout however is available in a large number of countries. Google Offers is due to launch in a greater number of countries.

By (almost but not fully) giving up on NFC, Google has pushed the service to a place where it can go head-to-head with a growing number of mobile payment services, including PayPal, ISIS and Apple Passbook, and where it can also leverage its market dominance in Search, web advertising and location based services.

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