Google, Apple Joust for Mobile Payments via Android, iPhone

Google is reportedly chatting with PayPal on mobile payments for the Android Market. Apple has hired a near field communications expert, possibly prepping the iPhone to be used as a wallet.

Google and Apple are both making moves to ensure smooth financial transactions on their mobile platforms.

Last week news bubbled up that Google and PayPal were brokering a deal to let the search engine use the e-commerce service as a payment option for applications purchased through Google's Android Market.

Apple, meanwhile, hired an expert in near field communication (NFC) technology as its new product manager for mobile commerce and has published a number of NFC-related patents in recent months.

Google's e-commerce infrastructure is poor compared with that of Apple. Users may only purchase applications for their Android smartphones from the Android Market in 13 countries.

By way of comparison, consumers may purchase apps from iPhone's App Store in 90 countries all over the world. PayPal would be a welcome addition to Google Checkout and credit cards as payment options in the Android Market.

Marianne Wolk of Susquehanna Research said that in the near term, such as move would bolster an Android Market suffering from a paucity of payment options and coverage. Long term, Google could leverage PayPal to sell other digital goods, such as books, music and video.

"PayPal would bring the Android marketplace a sizable user base of 87 million registered accounts, as well as incremental support for direct bank account debit or money orders," Wolk said.

"By integrating PayPal more tightly with Android, it could enable one-click purchasing that is more comparable to the Apple app store, which would facilitate greater usage."

Gartner has said the market for mobile apps will be $6.2 billion this year, making it an obvious sector for Google and Apple to attack with gusto.