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Google Communications The Almighty Buck

Google Ready To Rule NFC-Based Mobile Payments? 87

Posted by samzenpus
from the one-payment-method-to-rule-them-all dept.
itwbennett writes "Google may seem like an odd pioneer for mobile payments, says blogger Ryan Faas, but according to recent reports, the company is developing its own NFC payment solution. Here's why Faas thinks Google has a leg up in this emerging market: 'Google does have a lot of clout when it comes to NFC because the recent launch of the Nexus S and Gingerbread (the most recent Android release) offer the first truly widespread smartphone/NFC integration. That could give Google significant bargaining power. It also makes a certain sense to expect Google to try to lead in this area when you consider that the company is hyping mobile search and recommendation features.'"
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Google Ready To Rule NFC-Based Mobile Payments?

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  • NFC (Score:5, Informative)

    by FauxPasIII (75900) on Wednesday January 05, 2011 @07:04PM (#34771058)

    For those wondering: http://en.wikipedia.org/wiki/Near_field_communication [wikipedia.org]

    • Would have been very useful to link to this in the article or explain it. Mod up for reference
    • Being first does not mean you'll automatically win. It's a bit presumptuous to assume Google has a "leg up" just because they released the first NFC-capable device. Remember: Sony was first with the VCR and look where they ended-up (lost to JVC with its better-designed and cheaper VHS).

      • by blair1q (305137)

        Being first means you get a premium on sales without competition, and can reinvest the extra money to continuously improve your product to stay ahead as competition starts to appear, and always have better margins.

        I.e., unless you fuck it up by assuming you're done when you first deploy it, you win.

        • by ezzzD55J (697465)
          Nonsense. There is such a thing as 'first mover advantage,' but it doesn't mean you'll win if you don't fuck it up. There are countless counterexamples. Who uses a Xerox photocopier, a Hoover vacuum cleaner, the Altavista search engine, etc.?
          • by blair1q (305137)

            All direct examples of "fucking it up."

            All of those companies rested on their first-in status and failed to keep ahead using the first-to-market money.

            They assumed the attitude of leader instead of actually leading. They tried to benefit academically instead of productively, and tried to project an image of quality in markets where performance was more important. They fell behind on innovation and left market holes through which their competitors drove entire product lines. They fell behind on unit margi

            • by ezzzD55J (697465)
              Ok, I admit Xerox and Hoover aren't dead, but they're not the top dogs in their field by a long shot, so in that sense they haven't "won."

              I guess this discussion is doomed to fail given how vague fucking something up is.. Somethings tells me you'd like to see it mean 'not winning,' in which case your original point is unassailable ;-)
              • by blair1q (305137)

                I said they fucked up, so they didn't win. Fucking up is how you don't win. Fucking up is failing to use your profit-margin advantage to reinvest to maintain your profit margins. Being first-to-market gives you that advantage over everyone who follows you. By not using that advantage, you are fucking up.

                It couldn't have been more clear, but I made it more clear anyway.

          • by rhook (943951)

            Many people use Xerox brand machines and Hoover vacuum cleaners.

          • by afidel (530433)
            We use Xerox MFP's, we have dozens of them and some see upwards of a half million pages a year. From what I could find on the web they had a 28% marketshare at the end of 2005 in the MFP space (which is where most commercial copiers are since a fixed function copier makes almost zero sense for most businesses). More recent 2008-2H2010 numbers show similar numbers based on units shipped.
          • You missed "Windows Tablet".

        • Being first means you get a premium on sales without competition, and can reinvest the extra money to continuously improve your product to stay ahead as competition starts to appear, and always have better margins.

          Who created the first personal computer again? The first television? The first radio?

          Often the company that becomes rich off an invention isn't the one that first creates it but the one that waits for the technology to mature and spread a bit. It's very easy for the pioneers to become associated with the inconveniences and incompatibilities of an emerging technology, while relative latecomers simply by virtue of their delay become associated with a much smoother experience.

      • Re:NFC (Score:4, Insightful)

        by spun (1352) <loverevolutionary@@@yahoo...com> on Wednesday January 05, 2011 @07:46PM (#34771544) Journal

        Most folks who have analyzed the videotape format war agree Betamax was technically superior, at least at first. Technical superiority played no part in the ultimate victory of VHS over Betamax. It was a great example of the network effect. In essence, VHS was popular because simply it was popular, like certain celebrities who are famous only for being famous.

        • Re:NFC (Score:4, Informative)

          by Mike Van Pelt (32582) on Wednesday January 05, 2011 @08:20PM (#34771834)
          VHS became more popular than Betamax because an entire movie would fit on a single VHS tape. For most consumers, that factor far outweighed the somewhat better picture, and arguable "technical superiority". Much later, Sony produced Betamax decks that could record more than one (1) hour of programming, but by then, VHS had too much of a lead.
        • Re: (Score:2, Informative)

          by Xtifr (1323)

          Most folks who have analyzed the videotape format war agree Betamax was technically superior, at least at first.

          That's basically true, as far as picture quality went.

          Technical superiority played no part in the ultimate victory of VHS over Betamax.

          That's not so true. VHS wasn't limited to 1 hour like Beta was at first, and that one detail of technical superiority may have played a part, although opinions are divided whether it was a major factor.

          In essence, VHS was popular because simply it was popular

          That's definitely not true. VHS was cheaper, and wasn't subject to the whims and restrictions of a single company. There were rumors--quite false, but they may have had an impact on the market--that Sony wouldn't license Beta technology for porn. For m

        • >>>Most folks who have analyzed the videotape format war agree Betamax was technically superior, at least at first

          How so? Betamax and VHS have identical specs (240-250 analog lines of horizontal resolution) (50-10,000 hertz sound - later 20-20,000 with Beta and VHS HiFi). In fact in many ways Betamax was inferior because it only held an hour a tape where VHS was immediately released with 2 and 4 hour modes. Consumers want more time and VHS offered approximately double what Betamax could do.

          • by spun (1352)

            You are confusing early and late model Beta and VHS. In the first release, Beta was clearly superior, with 250 lines vs 240 lines horizontal, lower video noise, and less luma/chroma crosstalk than VHS. But it only had an hour playback time at that quality. Extending playback time to two hours (plenty for a movie) gave it, well, okay, an equivalent quality. So it wasn't really quality or playback time, as they were roughly equivalent by the eighties when people really started buying videotape players.

            • >>>Beta was clearly superior, with 250 lines vs 240 lines horizontal, lower video noise, and less luma/chroma crosstalk than VHS.

              Yeah but can anybody SEE that difference? No not really. Besides JVC quickly added "HQ" to their VHS units to bring them up to 250 lines, with NR, and better filtering of the chroma.

              And of course VHS still had the two times longer recording ability throughout its lifespan, so it was superior than Betamax, if only in that one aspect. 5.5 was the longest Betamax did, whi

              • by spun (1352)

                I would posit that anything over 2 hours per tape is plenty and consumers would not factor that into purchasing decisions. The picture quality was not a big factor either. I'm saying, this is an example of the network effect randomly selecting one of two very similar products. This is not an example of the free market selecting the superior product and punishing the inferior product. Which products succeed and fail in the market has more to do with factors such as marketing, branding, and the network effect

                • >>>I would posit that anything over 2 hours per tape is plenty and consumers would not factor that into purchasing decisions.

                  Not if you want to tape a football game which often goes 4 hours. Betamax only did 1 hour initially... and 3 on the slowest setting. Still not enough to tape the game or an evening of primetime (7-11), and therefore consumers would pick VHS (which did 4 hours from day one).

      • by vux984 (928602)

        ony was first with the VCR and look where they ended-up (lost to JVC with its better-designed and cheaper VHS).

        Sony had brand name recognition, and a leg up on getting a product out the door... JVC could have licensed Beta and released Beta players, except that Sony's terms were so ridiculous that JVC figured it would be more profitable to invent their own standard rather than work with Sony.

        Sony lost the format wars by enabling them to happen in the first place. Had they licensed the technology more reason

      • by Ecyrd (51952)

        Nokia and Samsung have had NFC-compatible models years ago. They're in active use in countries like Austria and Germany. Also, Japan has had its own NFC-based infra in place for years, and most cell phone manufacturers offer payment-capable phones in there. Have done so for the past few years.

        Google is hardly the first.

      • by KlomDark (6370)

        First to market they are not. PayPal has had this same functionality for almost a year now: http://techcrunch.com/2010/03/15/paypal-iphone-app-bump/ [techcrunch.com] - Copycatting, not innovating.

      • by rrey (1886420)
        Google is not the first... They are just the first to communicate on it. Nokia and Samsung have their own devices ready for at least a year.
    • by MarkGriz (520778)

      And by calling it NFC instead of RFID, all of its security issues magically disappear

      • Re:NFC (Score:5, Interesting)

        by hedwards (940851) on Wednesday January 05, 2011 @07:45PM (#34771522)
        NFC isn't RFID. It's RFID plus a simple extension to allow it to both read and be read. Which isn't RFID, it's several steps more scary that RFID.

        You're point about the name change is apt though.
        • Re:NFC (Score:5, Informative)

          by swillden (191260) <shawn-ds@willden.org> on Thursday January 06, 2011 @01:02AM (#34773500) Homepage Journal

          NFC isn't RFID. It's RFID plus a simple extension to allow it to both read and be read..

          It's not just RFID. NFC is two completely different RF technologies packaged together. One is contactless smart card technology (ISO 14443), at the frequency 13.56 Mhz, which enables very close-range (centimeters) relatively high-bandwidth (up to 800 kbps) bi-directional communication and is the technology used by the better contactless credit card payment systems, using cryptographic security. The other is what's normally called RFID, I forget which ISO standard, but it's at 900 Mhz and functions at much longer ranges (up to a meter or two) but only enables very simple communication. RFID tags are typically very "stupid" -- no microprocessor and many of them can't do anything other than respond with a number fixed at manufacture time when energized by a reader. Others allow the short numeric code they contain to be changed.

          NFC actually enables the phone to operate as either reader or card/tag with both of these RF technologies.

          This means that your phone can, in theory, act as a contactless smart card payment terminal, allowing you to accept credit card payments from an ordinary contactless credit card, or from another phone acting as a card. And, obviously, your phone can act as a contactless credit card -- but one with much better security because the phone has the ability to authenticate the user where the card doesn't, necessarily. Well, better security unless your phone gets rooted...

          Oh, and of course, you'll be able to put multiple credit card accounts on your phone, so you can eliminate your cards from your wallet.

          An NFC phone can also act as RFID reader, meaning that as retailers shift from putting barcodes on packages to cheap RFID tags, you'll be able to scan merchandise with your phone (you can do this now with phone cameras and UPC codes, but it's much less fiddly with RFID). Other use cases that get bandied about are things like embedding RFID tags in movie posters so you can scan the poster and get taken to a web site with more information (really, this is a use case that is OFTEN discussed in the industry as a sample application, as lame as it is). Finally, an NFC phone can act as an RFID tag. A commonly-suggested application for that is simple loyalty cards, like the Subway card that gets you a free sandwich after so many purchases. So you can get rid of those from your wallet also.

          All of these features will, of course, be controllable by the phone's software, so they can be completely disabled when they should not be used, which is very nice for security and privacy. Again, assuming your phone remains under your control.

          • by mbstone (457308)

            So if I scan a T-shirt at the store, it will flash up on my smartphone, "We don't have XXL, but our XL shirts are pre-shrunk, so they'll fit even if you wear XXL"?

          • And, obviously, your phone can act as a contactless credit card -- but one with much better security because the phone has the ability to authenticate the user where the card doesn't, necessarily.

            I don't think so. A smartcard is much more secure than a phone. In fact, I've worked on an NFC project where the phone was just a relay between the user and the SIM card. All the cryptographic operations were done on the card. The phone was just used as a user interface to enter the PIN code.

            • by swillden (191260)

              And, obviously, your phone can act as a contactless credit card -- but one with much better security because the phone has the ability to authenticate the user where the card doesn't, necessarily.

              I don't think so. A smartcard is much more secure than a phone. In fact, I've worked on an NFC project where the phone was just a relay between the user and the SIM card. All the cryptographic operations were done on the card. The phone was just used as a user interface to enter the PIN code.

              An NFC chip is a smart card (which may or may not be the same smart card chip as the SIM). Yes, the phone is "just" a user interface to enter the PIN code, but contrast that with a typical contactless smart card which, if a PIN is used at all, is only entered via a payment terminal which isn't under your control and may have been hacked or may even be bogus. Moving the PIN authentication to a device that's under your control is a big win for security (assuming it's actually under your control -- I'm reall

        • by heatpump (1958332)
          No. Google is alway trying to make anything free of charge and then think about some other way to charge.
    • by SpaFF (18764)

      So 10 years ago everyone was talking about how the phones of tomorrow would have this neat technology called "bluetooth" that would let us use our phones like an ATM card. Obviously that never happened. So what does NFC give us that bluetooth didn't that will actually allow mobile payments to work?

      • As usual, Japan actually went ahead and adopted NFC, albeit with a couple of competing standards. There's Suica [wikipedia.org], ICOCA [wikipedia.org], Edy [wikipedia.org], Nanaco [wikipedia.org], etc - and you can use them all from your mobile phone, merely by downloading the appropriate app.
    • http://bit.ly/hxZ9GI [bit.ly] Thought it would be interesting to use NFC in an electromechanical smart door lock.
  • Maybe I'm the only one who didn't know instantly, but that's what it is.

  • by Troll-Under-D'Bridge (1782952) on Wednesday January 05, 2011 @07:12PM (#34771160) Journal
    Okay for those "initially" confused like me. Here's a link to what I believe NFC stands for [wikipedia.org]. The Wikipedia redirect page for NFC [wikipedia.org] lists 11 possible expansions, including at least two other computer related terms and one possibly related to Finance (F), something called the National Finance Center.
  • Not good (Score:5, Funny)

    by Waffle Iron (339739) on Wednesday January 05, 2011 @07:14PM (#34771190)

    I heard that Google and Microsoft agreed to carve up the territory by division, and MS will get control of AFC payments. This is looking like it's going to be just another duopoly like cable vs. DSL providers.

    • by hedwards (940851)
      Yawn, let me know when they're carving up the Bud Bowl.
    • by c0lo (1497653)

      AFC payments

      What's that?

      • by whoop (194)

        An American football thing.

        • by aiht (1017790)
          Ahh, so this was a joke?
          For those who know nothing of US football like me:
          NFC = National Football Conference and AFC = American Football Conference
          For some reason the American NFL (National Football League) is composed of these two Conferences.
  • This story was actually posted in the exact same minute that I held my Google Nexus S against my NFC-bus pass to see if it would register.

    Coincidence? I think so!

  • by Anonymous Coward

    First tried in Hong Kong, where it worked. See Octopus card. Never worked in London, where some 10m people have had this technology for 8 years. I think this is really a function of culture than anything else.

    • Quite true. I worked and lived in Hong Kong for some two years, and I was surprised to be able to "touch and pay" for a lot of things at a lot of places. And without giving my identity, but just using a top up card. However, for some reason this method is not very popular in other cultures. Barclays have been trying hard to push their NFC credit cards in the UK for the last couple of years, as have TFL (Transport for London). Even in the ah-so-modern New York, although the option to pay contactless exists
  • Google's NFC thing only works on Gingerbread phones that have the NFC chip. How many of the thousands of tablets and phones announced on CES have it?

    • by Anonymous Coward

      Google's NFC thing only works on Gingerbread phones that have the NFC chip. How many of the thousands of tablets and phones announced on CES have it?

      Don't worry, none of that will matter; once Apple "invents" it in their next generation of iThingamajigs, they'll tell everyone they have to use it and remind us how beautiful and glorious Apple is because they invented it first.

  • NFC and cell phone integration has been widespread in the Japanese market for several years. It is supported by all major carriers and has significant market penetration in that market. More importantly, it works with an existing large ecosystem of contactless payments and identity applications. http://en.wikipedia.org/wiki/Osaifu-Keitai [wikipedia.org].

    While I applaud Google's pushing NFC adoption via Android, the biggest barrier to adoption will be interoperability with existing payment infrastructure such as Suica http: [wikipedia.org]

    • The NFC stuff in the Nexus S is supposed to be compatible with stuff like Mastercard's PayPass; it may be a while before the banks add support/apps for this. They already have those at every McDonald's in Florida.

      • by hedwards (940851)
        So, shall I add it to the list of reasons not to upgrade my Nexus One to the Nexus S? Seems to me that all this wireless payment stuff isn't entirely baked.
  • ...are looking forward eagerly to this.

    • by blair1q (305137)

      Why? Is NFC always-on, like passive RFID is? Or is it enabled when you tap a button while holding it up to the terminal device?

      The blackhats can grab at my ass all day, but they won't get my digits unless they try to put their sniffer on top of my hand at the checkout.

      • Try to imagine some of the things they will be able to do once they get some malware running on your phone.

        • by blair1q (305137)

          What? They can activate the button for me when I put the phone up to the pay terminal? Saves me a step, as far as I can see.

          Other than that, there's nothing new they can do that they can't already. All they need is a keylogger to snag a credit-card number when I'm buying something online.

        • http://qubes-os.org/Home.html [qubes-os.org] - possible android version? Use a MiniOS kernel (xen team homebrew) - just for auth, hardware lock access to the smartcard to just that domain - and your golden.
      • by 1 a bee (817783)

        Or is it enabled when you tap a button while holding it up to the terminal device?

        Sure, it's better if you have to tap that button. But you still give up a lot of privacy through this payment method. Every time you pay this way you advertise your identity, your location, and the time of your purchase.

        This personal information leakage is a lot different than that the type that can be gleaned from say ordinary credit card transactions. It'll no doubt be captured in a way that makes connecting the dots easier, faster and more real time.

        I'd use this technology if it implemented something

        • What part of paying with a credit card in a store doesn't reveal your identity, location, and time of purchase?

          • by 1 a bee (817783)

            What part of paying with a credit card in a store doesn't reveal your identity, location, and time of purchase?

            No part of it. Apologies for being vague. I was trying to say that though in both transaction types, credit card and NFC, your personal information is revealed, in the case of Google's NFC implementation, this personal information will likely be fed into a live, real time "adworks" infrastructure that cross-correlates this information with information unrelated to the transaction (GPS location, connecting other dots). I don't imagine the credit card companies are anywhere close to such an infrastructure: t

    • ...are looking forward eagerly to this.

      No doubt, Google is marching eargely for this. Payment + GeoPositioning info in real time?

      Throw in some incentives for the NFC terminal operators to allow the terminals communicating (through the very NFC phone) the content of the docklet and have a real-time trove of info on the populace purchases.

    • by 1 a bee (817783)

      ...are looking forward eagerly to this.

      More like ...looking enviously at Google.

  • No Fat Chicks payments? I'm all for fit and healthy women, but sounds a little discriminatory.
  • by GodfatherofSoul (174979) on Wednesday January 05, 2011 @08:20PM (#34771828)

    Does this mean that even if one team really sucks, they'll still get a shot at the play-offs?

  • Why would Google seem like an odd pioneer for mobile payments? They run a payment gateway and they maintain one of the biggest mobile operating systems. If anything, they are the most obvious company in the world to do this.

  • National Football Conference payments??? Why would they do that?

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