Cloud Computing: Google Wallet Will Fail to Cash In: 10 Reasons Why

 
 
By Clint Boulton  |  Posted 2011-06-13
 
 
 

Lack of Demand

Show of hands: How many of you have ever thought about ditching your wallet for good because you can't stand carrying it? Our guess is not many. Techies might want to do it because they like the idea of using their smartphone for something else. But the fact is that most of us carry more than credit and debit cards in our wallets, such as health insurance cards and other items. Google Wallet doesn't provide a solution to that.

Lack of Demand

One Phone to Pay Them All

Google Wallet is only currently available on the Sprint Nexus S 4G Android 2.3 "Gingerbread" smartphone. This could be a boon to Sprint's Nexus S 4G sales if many people want to use Google Wallet. But more likely, limiting the rollout to one phone offered by the country's third largest carrier is not going to win over many converts. Google needs the help of AT&T and Verizon Wireless.

One Phone to Pay Them All

Whither AT&T, Verizon Wireless?

AT&T, Verizon and T-Mobile are all working on their own mobile payment platform under the ISIS mantle. Moreover, Verizon just announced a deal with the Payfone mobile payment processing service "to bring a new mobile payment system to Verizon Wireless customers." It sounds like Google is getting competition and not cooperation from three-fourths of its usual U.S.-based Android carrier partners. That's not good.

Whither AT&T, Verizon Wireless?

Single Payment Provider

Google is in the early going rolling Wallet out with support for a single payment provider in Citi MasterCard. As with the phone, you need to make sure Wallet has the support of multiple payment providers before you roll out a major new service. Not everyone uses CitiGroup MasterCard or wants to. Where are American Express, Visa and Discover? Wallet's credit card payment options are too limiting.

Single Payment Provider

Retail?

At launch, there are 15 retail partners, including Subway, Toys 'R' Us and Macy's. These are fine stores, but I'm sure there are plenty of people who don't patronize any of them regularly. If you want a lot of people to adopt something, you don't limit their choice of phones, payment options or retail store options. It doesn't matter that the Wallet app is free; if people can't use it, it's useless.

Retail?

NFC

We understand that NFC requires devices to be in close proximity to communicate reliably. But what if signals interfere with NFC, thwarting communications between the Nexus S 4G and the payment terminal? Users are forced to carry their wallets as a backup in case this happens.

NFC

No More Juice

If you're a Wallet user and your phone is lost or the battery dies, you're stuck back using plastic or cash again. When a reporter broached this subject with Google officials at the event, they laughed it off. One claimed that they couldn't imagine their smartphone running out of power. No one expects their phones to get stolen either, but it happens.

No More Juice

Fear of Unknown

We already mentioned that consumers may not be ready for Google Wallet. Consumers will also be afraid to try something new, such as Wallet, because they are uncertain about how secure it is. Indeed, the NFC chip, also called the Secure Element, will store users' credit card info for Wallet. But security experts said this could conceivably be gamed, exposing users to account-draining thefts.

Fear of Unknown

PayPal

Not only do consumers fear new payment methods, but Google hasnt exactly built up a reserve of consumer trust in the security and reliability of it data centers. PayPal, which accused Google of stealing its key mobile payment experts, may prove to be a more trustworthy option if and when its mobile payment service comes to market.

PayPal

ISIS

Earlier we mentioned ISIS, the Verizon, AT&T and T-Mobile-backed mobile payment effort. Some analysts are skeptical this group will come to the fore, but it could pose a formidable rival to Google Wallet if it hits the market as planned in 2012.

ISIS

Rocket Fuel