Google has been putting a lot of effort into its Google Wallet mobile payments app, especially after the launch of competitor Apple (News - Alert) Pay captured the public eye. In the interest of reviving Google Wallet, a distribution deal has been finalized with several wireless carriers—Verizon Wireless, T-Mobile and AT&T (News - Alert)—in the U.S. to start including its offering pre-installed on their Android offerings sometime later this year.
The company is simultaneously purchasing technology and intellectual property from Softcard, the carriers’ mobile payments company. Formerly known as Isis, Softcard is a joint venture formed in 2010 by the three aforementioned carriers to develop a cutting edge, independent mobile payments service, which didn’t end up reaching the market until 2012. However, this deal signifies that the carriers have given up on Softcard and relented to the main competitor Google (News - Alert) as it continues pouring resources into Google Wallet and closing in on Apple Pay. Current users can continue using the Softcard mobile payments app until the transition to Google Wallet is farther along its way.
Google Wallet, which first launched its tap and pay feature in 2011, can be used on any carrier network using an Android (News - Alert) device - running version 4.4 (KitKat) or above - to pay at locations accepting Near Field Communication (NFC) payments. The company plans to use the acquired technology and intellectual property from Softcard to improve Google Wallet’s general functionality. By partnering with such prominent carriers, Google will now have access to the distribution avenues it sorely needed to match Apple’s extensive network of bank partnerships.
Competition is also on the horizon from Samsung (News - Alert), which just last week acquired the payments startup LoopPay. Although Google has an advantage with the ability to pre-install its app on a range of Android phone brands, a few smart moves from Samsung can easily give the company the upper hand in as competitive a space as mobile payments.
Edited by Maurice Nagle
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