Google to Announce its NFC Mobile-Commerce Initiative

Google has confirmed it will be making a “partner announcement” concerning its NFC mobile-commerce initiative, which will be held tomorrow in New York.

Google is expected to announce the launch of its NFC mobile wallet and m-commerce applications with Citigroup and MasterCard Worldwide, which will provide the payment service for the project. Among other companies likely to be at the event are processor and trusted service manager First Data.

Stephanie Tilenius, vice president of commerce at Google, confirmed the pending announcement today at the TechCrunch Disrupt conference in New York City. “We’re making a big bet on it as a company,” she said, speaking of NFC. “There is a lot of potential there.”

Google has been working for a number of months on the mobile wallet, along with mobile-commerce applications for its Android operating system, NFC Times reported in January. The launch of the project has been delayed several times, however. The wallet, which Google has developed with the help of its NFC chip supplier, NXP Semiconductors, will play host to payment applications provided by partners. Citi, along with MasterCard, has been working with Google on the concept for some time.

Plans call for Citi to issue a prepaid MasterCard PayPass application to be loaded onto Google’s Nexus S and, later, perhaps other Android phones, NFC Times reported last week.

The large Subway sandwich chain in the United States will participate in the launch, according to sources. A Wall Street Journal article reported this as well and that other merchants will include the Macy’s department store and clothing chain American Eagle Outfitters. Starbucks also has been approached by Google, among other merchants, sources told NFC Times. It's not clear whether Starbucks will participate.

None of these merchants now reportedly accept contactless payment in the United States. But more than 100,000 merchant outlets already have readers installed stateside and, therefore, could accept payment from a PayPass application on the Nexus S.

Update: The first phase of the service is expected to launch as early as tomorrow in New York and San Francisco and possibly a few other cities. A larger phase of the project will start in September of this year. Google hopes to have at least 500,000 Nexus S phones activated in the pockets of U.S. consumers by the end of the year, NFC Times has learned. End update.

Google is keen on using NFC and smartphones supporting Android to enable merchants and consumer products companies to deliver targeted advertising and offers to prospective shoppers, based on their location, buying preferences and other data.

It would use NFC to enable consumers to tap tags embedded in smart posters to download coupons and other offers and perhaps product information, as well as to pay, sources have said. These NFC services could work along with cloud-based apps. Google is also expected to offer its Google Places app, which enables users to tap tags embedded in stickers or decals on merchant storefronts to download information about the businesses and to rate and review the establishments.

The Web giant has been talking to other banks, in both North America and Europe, to provide the payment piece of the mobile-commerce service, NFC Times has learned. First Data is expected to provide processing and TSM services for the U.S. launch, the latter services with its technology partner SK C&C USA. Google also is reportedly working with such point-of-sale and contactless reader vendors as VeriFone, Ingenico and perhaps Vivotech to enable users to tap their phones to pay and redeem coupons and other offers at the checkout counter.

The launch will put the Citi-issued PayPass application inside Google’s mobile wallet, where it will be stored on the embedded secure chip in the Nexus S, sources earlier told NFC Times. Google is expected to have overall control of the secure chip and application-programming interfaces, or APIs, to access it, said the sources. Google commissioned Samsung Electronics to make the Nexus S, which is distributed mainly through consumer electronics stores.

Such phone makers as BlackBerry producer Research in Motion and Samsung, manufacturer of other Android handsets, also are interested in controlling the embedded secure chip in their phones. 

This sets up a possible showdown with mobile operators over control of the secure elements in NFC phones. Google's m-commerce initiative could represent the first shot in a coming mobile wallet war, say some observers.

HEADLINE NEWS

Deutsche Telekom Payments Chief Departs; Telco to Revamp Struggling Wallet, Including Planned Support for HCE

NFC Times Exclusive – Deutsche Telekom has appointed a new head of payments and plans to support host-card emulation among other technologies as it seeks to revamp its struggling NFC mobile wallet, NFC Times has learned.

People on the Move: Sequent Software CEO Steps Down; Interim CEO Appointed

NFC Times Exclusive – Sequent Software, a supplier of mobile wallets, TSM and host-card emulation products, has appointed an interim CEO, replacing Robb Duffield, who stepped down earlier this month after having served as CEO for the Silicon Valley-based vendor for just under three years.

GSMA, Telcos Consider Common Platform to Support Tokenization on SIMs

NFC Times Exclusive – Mobile operators are considering shopping for technology to launch a common platform to request tokenized payment cards from such providers as MasterCard Worldwide and Visa and to load the tokens onto their NFC SIM cards, NFC Times has learned.

Visa and MasterCard Change Strategy on Tokenization Fees; Observers See Gambit to Lock in Market

NFC Times Exclusive Insight – Visa maintains that its offer to waive tokenization fees for the long term is designed to simplify the connections between thousands of card issuers and such wallet providers as Google and, perhaps later, Apple, thus driving widespread rollouts of mobile-payments services.

Vodafone’s Proxy-Card Service Likely to Face Difficult Market

NFC Times Exclusive – Vodafone Group’s proxy-card NFC mobile-payments offer, which is designed to enable subscribers to add their credit and debit cards to their Vodafone Wallets as funding accounts linked to a Vodafone prepaid card stored on the SIM, has yet to be launched by any major Vodafone branch operator in Europe.

Canadian Telcos Refuse to Give up On SIM-Based NFC, Though Many Challenges Lie Ahead

NFC Times Exclusive Insight – The head of the Canadian telco joint venture Suretap Wallet told NFC Times that this week’s launch of the telco’s new wallet service was not prompted by the expected expansion of Apple Pay into Canada later this year.

At Least Some U.S. POS Terminals to be Ready to Support Apple Wallet Rewards

NFC Times Exclusive – Major point-of sale-terminal vendors say that their most recently deployed terminals and perhaps others will be ready to accept loyalty cards from Apple’s Wallet when the nonpayment application launches with iOS 9 this fall.

CASE STUDY: Asia-Pac’s First HCE Launch–Higher Transaction Value, Though User Numbers Remain Small

Jun 23 2015

UPDATED: NFC Times Exclusive – Australian credit union CUA has seen a 16% increase in value of transactions for mobile payments since the launch of its host-card emulation mobile-payments app last summer, though user numbers have remained small 11 months after one of the first HCE commercial launches globally.

Vendors Say Mobile Payments at Vending Machines on the Rise

NFC Times Exclusive Insight – Suppliers of cashless payment for vending machines predict the rollout of Apple Pay, along with planned introduction of Android Pay, will continue to reduce the use of cash at U.S. vending machines and will also lead to higher transaction amounts, though did not release actual figures.

Taiwan Banking Joint Venture to Request Tenders for HCE and Tokenization Platform

NFC Times Exclusive Insight – Taiwan’s banking joint venture, Taiwan Mobile Payment Co., has disclosed that it will issue a request for tenders for a host-card emulation and tokenization platform, with plans calling for the technology to be made available to Taiwanese banks for mobile-payments launches by the end of the year.

Apple, Transport for London Face Potential Problems Enabling Apple Pay for Fare Collection

NFC Times Exclusive – Both Apple and Transport for London are trumpeting the coming use of Apple Pay to pay fares on various modes of mass transit in London, including the fast-paced London Underground. But they face a couple of problems.

Apple Announces Addition of Nonpayments Applications, First International Expansion for Apple Pay

Jun 11 2015

NFC Times Exclusive Insight – Apple today announced major new updates to Apple Pay, including the addition of store credit, debit and loyalty cards in the U.S., expansion of the mobile-payments service to its first overseas market, the UK, and a renaming of the wallet app itself from Passbook to Wallet.