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What will Google’s acquisition of Zetawire mean for mobile payments?

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December 15, 2010

Samsung, Google and Best Buy team up to make Nexus S a success

Samsung, Google and Best Buy team up to make Nexus S a success

Google has acquired Canadian startup Zetawire to enhance its Near Field Communication offerings that enable contactless mobile payments and bridge Google Checkout and point-of-sale payments.

There have been many recent developments related to NFC, with the major U.S. carriers, along with Discover and Barclaycard, collaborating on Isis, and Google announcing that its Samsung-manufactured smartphone Nexus S would be NFC-enabled. Google could use Zetawire, and the patents that it holds, to enhance or launch a variety of mobile platforms, from mobile banking, advertising and identity management to credit card and mobile coupon transaction processing.

“Even though this was a minor acquisition, the Internet giant’s acquisition of Zetawire is yet another indicator that Google wants to play a significant role in the payments space,” said Kolja Reiss, managing director of mopay Inc., Palo Alto, CA.

“Google Checkout still falls somewhat short of expectations, but this is likely to change: Jambool brought Google significant knowledge about Internet payments, and Zetawire adds technology and patents that come in handy for point-of-sale NFC payments,” he said.

Mopay is the mobile messaging and payment unit of MindMatics AG. The company is not affiliated with Google.

Mobile Commerce Daily’s Dan Butcher interviewed mopay’s Mr. Reiss. Here is what he had to say:

What, in your opinion, is Google’s strategy behind its acquisition of Zetawire? How does it fit in with other recent acquisitions such as Slide and Jambool?
Even though this was a minor acquisition, the Internet giant’s acquisition of Zetawire is yet another indicator that Google wants to play a significant role in the payments space.

Google Checkout still falls somewhat short of expectations, but this is likely to change: Jambool brought Google significant knowledge about Internet payments, and Zetawire adds technology and patents that come in handy for point-of-sale NFC payments.

How could this help Google ramp up its mobile commerce/marketing initiatives, from mobile banking, advertising and identity management to credit card and mobile coupon transaction processing?
Google Checkout is likely to be a core product of any mobile initiative Google is launching in the future.

Zetawire’s patent and technology particularly help Google to further bridge the current gap between the point-of-sale and Google Checkout. It will most likely shift Checkout’s focus from Internet payments to store payments.

How does this acquisition fit into the context of the upcoming release of the NFC-enabled Nexus S smartphone and the recent Google Goggles and location-based marketing campaigns?
The Nexus S and the most current version of Android are marking a starting point for the “future of payments.”

It is unclear if Zetawire’s technology already contributed to the new, NFC-enabled Nexus S, but it is likely that it will—one way or the other—in future releases of Android phones.

Final Take
Google Checkout store gadget

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Dan Butcher is associate editor on Mobile Commerce Daily and Mobile Marketer. Reach him at dan@mobilemarketer.com.

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