Mobile Payments - Will they or won’t they?
We highlighted in this blog last week about the announcement from Verizon and that it would block Google Wallet. Only a few days later there was a counter-announcement from Verizon that it wasn’t really blocking Google wallet, it was in discussion with Google about implementing a suitable “secure element” on the handset. OK – that’s understood, but within a few days of that turnaround there was the rumour reported by Les Echos that Google was targeting the London Olympics for a launch of its wallet in the UK. That was really interesting – particularly as we have also highlighted the great potential presented by the Olympics to kick-start the NFC payments market. But, wait for it, within a few days of that article, “a source close to Google” said it was unlikely. What does this rapid counter-announcement from Verizon and rumour-denial from Google mean? I think we can make a number of observations. The first is reputational - the “wallet wars” are now in full swing and mobile payments is a high-profile topic. Whether you are a MNO, OTT Player or Financial Institution – your positioning and reputation is now at stake in how you present yourself to the market; you can’t be seen to either block the market or make a mistake; your competitors and your future consumers are watching. The other is more technical – Verizon rightly highlighted the fact that the secure management of your financial details and transactions on the mobile handset must be in place before a mobile payments service is launched. Similarly Google was rightly cautious about committing to a service for which it has not got all the agreements with MNOs, Financial Institutions and Retailers in place – and more importantly trialled the service before commercial deployment. There’s not much time left for all that before the Olympics and a failure at such an international event would be catastrophic for everyone. So, despite the “turnarounds”, we see these announcements, counter-announcements, rumours and denials as an indicator that mobile payments are on the cusp of mainstream adoption. The Olympics may be a “bridge too far” for the market just now, but the players know what’s at stake and what they need to do. For more on the NFC Payments market see our report.