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Augme Technologies, Inc. Message Board

  • biggergrove biggergrove Sep 30, 2011 3:53 PM Flag

    Google Wallet

    The Google Wallet predicament NFC Rumors exclusive

    Although Google Wallet is out in the open and available to some, the details on how Google Wallet is building out have been shrouded in mystery. Well, that is until today. NFC Rumors has received information from a source who is close to the matter who revealed some details Google and others would have preferred you didn't know.
    The Google Wallet roll out predicament

    Google Wallet released last week to the general public with a specific Android update pushed to Sprint Nexus S 4G customers that enabled the Google Wallet and Secure Element for the first time. However, executives within Google are said to be releasing that they are going to have to spend some money to market the nascent NFC mobile wallet to attract more attention. As crazy as that may seem with all the media attention take up has been lower than expected. This is probably due to one phone that is capable of making these payments that is starting to age compared to other NFC phones that are making their way into the market.
    The Google Wallet Citi predicament

    Our source intimated that that banks beyond Citi are going to have to wait to get loaded into Google Wallet and the Nexus S 4G. There is apparently a deal that prevents Google from bringing on other banks at this time and that deal appears to have Citi with an advantage over Google. We don't know the exact details of this deal are, but we can see that this particular predicament is preventing Google and its Google Wallet from getting the banks buy-in and that the situation is playing right into Isis' hands. A situation where Google is not allowed to bring more banks into the Google Wallet obviously has an exclusivity deal written all over it. However, we have found out from a different source that that agreement is likely to end sooner than Citi expects, which could represent Google going it alone to save the competitive advantage it has by being the first NFC mobile wallet in the market. For now, consumers can load other banks via the pre-paid re-loadable GCard, but this too is fraught with issues.
    Google Wallet data predicament

    The rabbit hole goes deeper in preventing other banks from getting involved with Google Wallet. As if not being able to become fully integrated wasn't bad enough, banks are finding that Citi gets a percentage of fees, and what is probably worse from another bank's perspective is that Citi also gets all payment data. This includes where a transaction took place, how much was it for and probably even what was purchased. This data is the life blood of how banks intend to market services to consumers. It wouldn't make sense to give that data to a competitor and not receive it yourself. From what we are hearing, this is putting a lot of the larger banks (read Bank of America, Wachovia, etc.) off getting into the Google Wallet at this time. The way this works is that consumers currently have to load let's say $1000 from their account. Now any transactions used on that account are based in the Citi card ecosystem. Your bank only knows that you loaded $1000 on to the GCard.

    What is clear is that Google needs the exclusivity agreement to come to an end quickly. Citi should also realize that the short term gains are not worth the long term costs of holding Google to an agreement that leaves Citi as the exclusive card for Google Wallet. On top of that, Isis has made no such suicide deal and is actively making news to belittle Google's first to market position. Google Wallet has some troubles, but the wallet wards have just started.

    This post was originally written by NFC Rumors.