The (mobile) payments segment is one of the most interesting and dynamic in technology. Google Wallet made an early splashy debut but has stalled on lack of consumer availability — it still only works on one phone in the US. While that should change in the near future, for now relatively few people are using it.
While the market waits for NFC payments to arrive in earnest the NFC-based Google Wallet is effectively being sidelined by other companies that aren’t relying on the technology or its mainstream adoption.
Square, for example, is gaining adoption among small businesses and processing millions of dollars in daily payments ($11 million at last count). PayPal is also moving fast on several fronts having recently introduced PayPal Here, a Square competitor, a new in-store payments initiative and a mobile payments app for consumers. And there are numerous others jockeying for position in this fast-moving area, including credit card issuers and mobile carriers.
There were several rumors circulating that all was not going well over at Google Wallet. Two Wallet personnel, Rob von Behren and Jonathan Wall, have recently left. In particular, von Behren left for Square. Whether that’s because Square has more momentum or because Google Wallet has stumbled (or both) is not clear.
I had also heard very informally from someone that Google was “backing away” from Wallet. That doesn’t appear to be true however. Yesterday Google announced the acquisition of TxVia, a six-year-old company that facilitates the processing of prepaid credit cards. Google said that the acquisition complements its existing Google Wallet strategy and infrastructure:
Today, we’re thrilled to announce that we’ve acquired payments technology company TxVia to complement our payments capabilities and accelerate innovation towards our full Google Wallet vision. TxVia is a technology pioneer that offers a fast, flexible and highly reliable payments platform—which we believe is one of the best in the world.
I’m sure there were a range of things attractive to Google about TxVia, its technology, it’s relationships and its management team.
Google Wallet is a container for two related initiatives at the company. One is the NFC-mobile payments push; the other is the stored consumer credit card program that used to be called Google Checkout.
While NFC payments (and related marketing capabilities) will eventually kick in when enough consumers have NFC-enabled handsets, that may still be several years away in the US. In the meantime Google will have to figure out how to keep merchants and consumers interested in Google Wallet as other more accessible payments tools increasingly proliferate.