U.S.: Google Launches NFC Wallet to Deliver Payment and Offers
The Google Wallet enables consumers to tap to pay at merchant locations that accept MasterCard PayPass, as well as redeeming digital coupons and other offers they can “clip,” from searches on their phones and load into the wallet. The coupons and offers are accepted at only a limited number of merchants so far. The Google Offers service will send promotions, such as deal-of-the-day offers, to the inboxes of users' phones, tied to particular merchants or businesses. Consumers could also search for offers through apps. Wallet trials are kicking off in New York and San Francisco.
In August 2012, Google unveiled the much-anticipated revamp of its struggling Google Wallet–a cloud-based version that opens up the wallet to cards from all major U.S. payment brands, but which continues to use NFC to enable consumers to tap to pay and redeem offers in physical stores.
Google’s support for NFC in its Android smartphone operating system and Nexus S handset, announced in December 2010, greatly increased the buzz in the NFC industry. The Web giant’s Google Wallet, unveiled in May 2011 and launched the following September has energized the industry further. Google is backing its support for NFC with money, including subsidizing some of the first contactless point-of-sale terminals for several large retail chains that do not already accept contactless.
Google is not planning to make its revenue from NFC on payment and is mainly enabling other service providers, such as Citigroup, to put their payment applications in the wallet. The Google Offers service, which sends deal-of-the-day and other coupons and promotions to consumers, appears to be key to the company’s business model for NFC, generating revenue from merchants and other advertisers that Google links up to consumers.
But Google's launch into NFC-based mobile commerce has gotten big mobile operators worried and some, including No. 1 U.S. carrier Verizon Wireless, is trying to block the wallet from the Android phones it sells. That includes Google's own Galaxy Nexus Android phone. This and other problems will make it difficult for Google to scale up its wallet rollout.
* Trusted Service Manager: Defined loosely to include companies or other organizations securely distributing, provisioning and managing applications, generally over the air, on secure elements in NFC mobile phones; or licensing their platforms for this purpose. N/A: Not available or not applicable. Last update: Aug. 2012