Mobile Wallet – Google’s most important product for 10 years

Mobile Wallet – Google’s most important product for 10 years

Back in 2000 I was lucky enough to meet up with Google’s CTO, the so-called ‘Employee Number One’, Craig Silverstein. He’d invited me along to the Dorchester in London to talk about the search engine’s new AdWords solution, just before the product was rolled out.

Silverstein spoke about the idea of a new pay-per-click and site-targeted advertising system that would be integrated into Google Search. After listening to his imagination-tickling speech, I unashamedly gave Silverstein’s ego a full body massage, telling him that I thought his new AdWords product will change the business world forever and even transform Google into an industry in its own right. He flashed a knowing smile and just said “that’s what I’m hoping”.

True to our mutual optimism that day, this was to be the moment Google went supernova. AdWords went on to become the company’s main revenue stream, generating revenues of $28 billion in 2010. Moreover, it has given businesses a quick and relatively cost-effective way to bring targeted customers through their doors.

Yesterday, as  I watched Google present its new Wallet solution, I got that same tingly feeling as I had 10 years ago, that something truly game changing is about to drop.

If you haven’t heard about Google Wallet yet, then I suggest you check it out here. Essentially it’s an Android app that turns your phone into a wallet. With it you’ll be able to use it to store virtual versions of your current plastic cards. When you want to pay for something in a shop, you just get out your phone at the payment point, tap a button and the transaction will be instantly processed via near field communication (NFC).


The potential for Google’s new mobile payment platform is huge. In fact, I would bet my horse that one day it will bring in more money for Google than AdWords does. But again, it’s the potential changes to the bigger picture that are so exciting. Google Wallet could be the single biggest thing to happen to the retail industry since credit cards were launched.

The product is still in its infancy (trials begin in New York and San Francisco this summer) but it doesn’t take much imagination to speculate on the scope of Google Wallet. As well as bank cards, eventually the app will store all your loyalty cards, gift cards, receipts, boarding passes, tickets, and maybe even your passport, eventually. We will never need to carry around or store any of these cards, documents or bits of paper again. Everything will be inside your phone. You won’t even need to carry money!

Google Wallet 1

Google Wallet will also open interesting new ways for retailers to interact with their customers. They will be able to store records of everything shoppers have bought, using this to send loyalty points or targeted product promotions to customer’s phones; people will be able to scan promotional codes on magazine and street adverts with their phones then automatically get a discount in a store the next time they purchase this product.

You might think that this vision is a long way off, and a lot does depend on the take-up of Google Wallet from merchants, banks, retail outlets and mobile operators. Also, to run the app you need an Android phone with an NFC chip built into it, and currently there are only two such devices (the Galaxy S II and the Nexus S).

However, I have a feeling Google Wallet won’t take long to start making its mark in the western world’s shopping malls, outlets, coffee shops , and restaurants. At launch, Wallet will support Citibank Mastercards and there are already 120,000 stores where the payment system will be accepted, including the likes of Macy’s, Walgreens, Subway, Toys ‘R’ Us and Bloomingdale’s.

Vending machine sale

Banks, credit card companies and retail outlets will likely be scrambling to integrate with the card as more NFC-enabled Android devices are released and hence more people have the ability to carry out transactions in this way.

All this could be disastrous for Apple, which has reportedly ditched plans to include NFC in its new iPhones, and will instead opt for its own proprietary mobile payment system, based around iTunes credits.

With point-of-sale terminals already in place to handle Google Wallet payments via the multitude of Android devices that will flood the market, retailers may not feel the need to invest in Apple’s payment system, leaving the iPhone high and dry in the payment revolution. iPhone sales could also be affected too, if, as is likely, consumers like the idea of ditching their wallets in favor of an Android phone with Google Wallet.

Google won’t have it all its own way though. Yesterday, eBay already attempted to rain on the search giant’s parade by filing a law suit centering around the stealing of ‘trade secrets’ by two of its ex-PayPal employees, who allegedly used this information to help develop Google Wallet.

This isn’t likely to faze Google too much though, and any payout it has to make will pale into insignificance compared to what it can make through its Wallet. Don’t forget that AdWords also had lawsuits filed against it, most notably from Yahoo!, which received 2.7 million shares from Google over patent infringement in relation to the AdWords service.

Assuming the various obstacles are traversed without problems, the launch of Google Wallet will be the most important since AdWords in 2000. It’s capable of revolutionizing not only Google’s business, but the entire retail industry along with it. It will also have a major impact on society, changing the way people go about their business.

Do you think Google Wallet will change the world? Will you be prepared to adopt it? Are you scared about Google having even more access to the daily life of the common man or woman?

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