What's Next for Google Wallet?

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16 May 2013
Zilvinas Bareisis
Last week saw a number of important developments at Google Wallet. Let's recap what we've learned:
  • Osama Bedier, the Head of Google Wallet, left the company.
  • Google Wallet scrapped its plans to introduce a physical card to support purchases at the physical POS.
  • Then, at Google I/O Developer conference, the company made a series of announcements about new features, such as:
    • Ability to send money to friends with Gmail and Google Wallet.
    • Instant Buy Android API designed for merchants and developers selling physical goods and services who are looking to simplify the checkout experience for their customers.
    • Storing of payment credentials in Chrome browser to speed up check out online.
    • Wallet Objects API to connect any loyalty programs, offers and more to Google Wallet.
So, what do we make of it all? Well, it seems that Google's strategy for physical stores remains in limbo. When Google re-architected its wallet solution it solved some of the challenges, such as provisioning of payment credentials by moving them to the cloud. However, its continued reliance on NFC means that it remains difficult to scale rapidly. Google was widely expected to follow PayPal's strategy of introducing a physical card for its account, but for whatever reasons that announcement never materialised. While Google is not pulling the plug on physical POS payments, it now appears to have re-directed its efforts to facilitating payments online, whether through desktops or mobile devices. Some observers likened its strategy as "death to PayPal by a thousand cuts." But I think Google is taking on more than just PayPal. It seems to follow a "best of breed" approach by incorporate interesting ideas from various players:
  • With email payments, Google takes on PayPal, but also many other P2P players, from Popmoney to Dwolla.
  • Instant Buy Android API sounds remarkably similar to V.me and other digital wallets designed to help customers fill out their payment and shipping details at a click of a button.
  • Leveraging the browser to facilitate check-out reminds me of what Dashlane is offering via its browser API.
  • And Wallet Object API is almost a direct take on Apple's Passbook down to notifications using the location services.
Google started its payments journey in the online space (remember Google Checkout?), went after the physical POS with Google Wallet and is now coming back full circle to payments online. Google's multiple assets, such as the Android platform, Gmail and others, combined with these new ideas certainly seem like the right ingredients to succeed. However, as every cook knows, ingredients alone are not a gurantee of success. And it will be merchants and consumers that will decide whether they like the taste of the latest offering from Google Wallet.

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