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Does Google Have Its Eye on Softcard?

Mobile Commerce Insider Featured Article

January 19, 2015

Does Google Have Its Eye on Softcard?

By Steve Anderson
Contributing TMCnet Writer

The mobile commerce market has shown itself to be a lion in the field, and anyone who remains unconvinced need only look at the numbers from the last Christmas shopping season, in which users overwhelmingly turned to mobile commerce tools to get those gifts that mean so much. But another part of the mobile commerce market has likewise showing itself a major part of things: mobile payments. With that in mind, new reports have recently emerged suggesting that Google (News - Alert) has its eyes on Softcard, which may help give Google an extra push in the field to take on some of the biggest names.

The reports suggest that Google has been talking to Softcard, itself a joint venture between three major wireless carriers, specifically, Verizon, AT&T, and T-Mobile (News - Alert). The deal is reportedly valued at under $100 million right now, and neither Google nor Softcard would actually respond to the reports, making this a topic for speculation around the Web and beyond. Indeed, a Google rep specifically noted that “We don't have a comment, background, deep background, off-the-record steer, nod, wink or any other verbal or nonverbal response to these sorts of rumors.”

But the fact that this “rumor,” as Google is calling it, even exists in the first place is a sign of much larger overall movement in the market. When it comes to mobile payments, one of the biggest names in the field right now is one that's been around the least amount of time: Apple Pay. With a huge install base and massive name recognition, this tool has already gained a lot of ground despite its short time even being available. That's prompting a lot of companies to make some changes in how operations are done in a bid to fend off the rising operation, which posted a whopping million credit cards to its purview after just 72 hours of availability. What's more, a recent Forrester (News - Alert) Research report notes that, by 2019 users will likely pay for $142 billion in goods with mobile payment systems. Sounds good in isolation, and sounds even better when the 2014 numbers are factored in at just $52 billion.

The market is clearly primed, and customer interest is substantial. So companies are eagerly scrambling to get market position and stake out a section of the field for each company's operations. Users are interested—as clearly exemplified with the rise of Apple (News - Alert) Pay—in getting in and active, so it's not really a surprise to hear that Google has an interest in getting hands on some of the market as well. Of course, Google already has something of a slice of the market with Google Wallet, but with Apple Pay showing itself to be such a major force, Google may well be feeling some of the pressure, and is looking to augment its operations by picking up a competitor's brand to add to its own. Given the fact that it's the payment method of three of the four biggest carriers in the United States, meanwhile, that may be the kind of force that's necessary to blunt Apple Pay's advances into the wider market.

Only time will tell if this particular rumor has anything like legs, or any connection to reality. But if Google does pick up Softcard, it could well be in the position it needs to be to take on the rapid uprising of Apple Pay in the field, and give us all a mobile payments market worth watching.

Edited by Maurice Nagle

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