Digital Transactions Authoritative, insightful and timely information for payments professionals
By Jim Daly
In its second major Google Wallet announcement of the week, search-engine giant Google Inc. today said it is bringing the digital wallet for the first time to Apple Inc.’s iPhone, a move that opens the wallet to tens of millions of potential new users. And like Tuesday’s announcement centered on the wallet’s expanding integration with Google’s Android mobile operating system, the iPhone news plays up Google Wallet’s capabilities in person-to-person payments, loyalty programs, and online and mobile commerce and downplays near-field communication (NFC) point-of-sale payments.
A Google Wallet app for iPhones running version 6.0 and higher of Apple’s iOS mobile operating system is now available in Google Play, Android’s application marketplace, and in Apple’s App Store. Apple released its new iOS 7 this week. A notice in the App Store says Google Wallet is also compatible with Apple’s other iOS devices, the iPod touch and iPad tablet, but is optimized for the iPhone 5, the newest model.
Google announced the iPhone app in a post on its Google Commerce blog. The expansion is significant because of Apple’s massive presence in mobile devices. While Android, an open operating system, has bigger market share in the U.S. than Apple’s proprietary iOS—51.8% versus 40.4% in July, according to comScore Inc.—Apple is the single biggest smart-phone seller. Some 40.4% of U.S. mobile-device subscribers had an Apple device in July compared with 24.1% for the No. 2 manufacturer, Samsung, according to Reston, Va.-based comScore, which measures the Internet and mobile telecommunications industries.
Apple sold 31.2 million iPhones worldwide in its third quarter of fiscal 2013 ended June 29 and 94.7 million of the devices in the fiscal year’s first three quarters, according to Cupertino, Calif.-based Apple’s latest earnings report.
Google Wallet’s iPhone app will allow users to make P2P payments to recipients in the U.S. with an email address, and use merchants’ loyalty programs in much the way they’re used on an Android device. IPhone holders with the wallet also can store credit and debit card account information to shop on mobile Web sites or buy apps in Google Play.
But Apple does not support NFC, which has been a key element of Google Wallet, so wallet users with iPhones will not be able to make contactless point-of-sale payments the way that holders of 29 NFC-enabled non-Apple smart phones can.
How much that matters is unclear. Mountain View, Calif.-based Google would not make an executive available for an interview, but the company’s recent announcements indicate that it’s moving away from the NFC-payments orientation that dominated news about the wallet when Google unveiled it two years ago. Only a minority of U.S. merchant locations can process NFC payments today, and, while growing, so is the number of NFC-enabled handsets.
“The Google Wallet has clearly morphed into a person-to-person and card-not-present wallet,” says mobile-payments consultant Todd Ablowitz, president of Centennial, Colo.-based Double Diamond Group. “Their energy has moved away, it appears, from NFC.”
A Google spokesperson would not comment when asked if or how Google Wallet might work with Apple’s Passbook app, an iOS feature that stores an iPhone user’s loyalty accounts, or if it will work with Apple’s new iBeacon, a variant of Bluetooth technology that’s part of iOS 7 and can deliver in-store offers to iPhones and potentially be adapted for payments.
The addition of Apple also will help Google Wallet at least partially fill the adoption hole caused by the lack of support for the wallet in non-Apple devices sold by the nation’s two biggest mobile carriers, Verizon Wireless and AT&T Mobility.
