Google Wallet Announces Softcard and Network Partnerships
- Tuesday, February 24th, 2015
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Google was partnered with some the largest mobile phone networks in the US in a deal that will see its Google Wallet mobile payments technology pre-installed on phones, as the companies seek to combat Apple Pays rising star in the mobile wallet sector.
As part of the partnership with AT&T Mobility, T-Mobile USA and Verizon Wireless, Google has acquired technology and intellectual property from Softcard, the mobile payments company established by the three networks.
From later this year, the Google Wallet app will come pre-installed on all Android phones running KitKat or higher sold by the three mobile networks in the US. Contactless mobile transactions in the US totalled $3.5bn (£2.26bn) in the US last year, and is expected to increase to $27.5bn by 2016.
There has been speculation for several months that Google would be acquiring Softcard following a troubled year for the firm, and while the deal has not been worded as an acquisition, with the three carriers who formed Softcard switching to Google Wallet, it is likely that the company will slowly be absorbed into Googles operations.
Google Wallet first launched as an NFC-based mobile payment system in 2011, but has struggled to reach a wide audience since then. With the renewed focus on NFC technology and mobile wallets following the announcement of Apple Pay, Google has been searching for a way to improve the visibility of its own solution.
“Googles new deal with Softcard and three major US mobile carriers will help get Google Wallet in front of more potential users, but the mobile payments space inthe US will continue to be competitive and fragmented for at least the next few years as various stakeholders vie to get traction with consumers,” said Bryan Yeager, analyst at eMarketer.
“This is an important step for Google Wallet, but it wont be the only mobile wallet option Android users will have. Samsungs recent acquisition of LoopPay and intention to release its own mobile payments system shows that deal activity doesnt necessarily equate to market consolidation.”