As Google improves its mobile payment app by introducing a cloud-based version, there’s confusion over which cardholders are actually supporting the service. Meanwhile, Apple’s acquisition of AuthenTec points to developments with NFC. Guy Daniels reports.
Google has announced a major upgrade to its Google Wallet mobile payment service, releasing a cloud-based version of the app that supports all credit and debit cards from Visa, MasterCard, Discover and American Express. Except American Express doesn’t think so.
Yes, you can now load your American Express card into Google Wallet, but AmEx is at pains to point out that the service is not an American Express-approved product. Apparently, the card company that likes to charge you for the privilege of own its piece of plastic is still evaluating Google Wallet to see if it meets is standards for data transparency. Google jumped the gun and used its brand without AmEx’s approval. In a statement to TechCrunch, a Google spokesperson said:
“We are in active discussions with American Express and look forward to working together as partners as the world embraces digital payments.”
To paraphrase Mastercard’s adverts; “knowing your customers’ spending patterns: priceless”. The problem is that Google keeps most this priceless data, and the card issuer has to make do with less information. The more data a card company has, the better they are able to target deals and offers to its users, ensuring they remain customers and don’t move to a rival service.
Writing on the Google Commerce Blog, Robin Dua, Head of Product Management for Google Wallet, said that they have changed their technical approach to storing payment cards:
“The Google Wallet app now stores your payment cards on highly secure Google servers, instead of in the secure storage area on your phone. A wallet ID (virtual card number) is stored in the secure storage area of the phone, and this is used to facilitate transactions at the point of sale.
Google instantly charges your selected credit or debit card.”
Dua says this new approach speeds up the integration process for banks so they can add their cards to the Wallet app in just a few weeks. Google has now partnered with more than 25 national US retailers and, through a partnership with MasterCard PayPass, customers can also use their NFC-equipped Android phone to pay for goods at more than 200,000 retail locations across the country.
A new security feature enables users to remotely disable their mobile wallet on a lost phone. As Dua says: “There is no way you can do that with your leather wallet”.
Meanwhile, Apple’s acquisition of security specialists AuthenTec at the end of last week for $356 million has prompted much speculation. As well as making an NFC chip with built-in encryption, the company also pioneers fingerprint recognition for laptops and phones.
So is Apple’s plan for AuthenTec more than just mobile payments? We are all expected to have numerous passwords for the online service we use, and to change them on a regular basis. Let’s face it; it’s an impossible request. Most people stick to one or two obvious passwords and never update them. There has to be a better way to confirm identity and access services.
When it was spun out of former parent company Harris Semiconductor in 1998, AuthenTec bet the shop that it involved fingerprints, but they were perhaps too far ahead of the market. Very few laptop manufacturers adopted the technology. But does Apple see biometrics as a way to disrupt the whole security and identity sector – not just on mobiles, but on all devices?
Obviously Apple is keeping quiet. But according to a Reuters report, the agreement filed with regulators hinted at the development of “a 2D fingerprint sensor for Apple that is suitable for use in an Apple product”.
When Apple finally enters the m-commerce market in the US, it will face established competition not only from Google Wallet, but also the Isis joint venture, Jack Dorsey’s Square, and PayPal’s move to expand from the web. But thanks to iTunes and the App Store, Apple already has its hands on more than 400 million credit card accounts and is about to introduce its Passbook app.
Apple is rarely the first to adopt a technology, but it has a good record of getting the timing spot on. NFC has been around for years without any real success. It’s not going to jump into a new area without first being absolutely sure there is a pressing commercial reason to do so, and without having al the necessary parts of a hardware-software ecosystem in place.
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