Google has found a way to circumvent carrier restrictions on its mobile wallet by introducing support for Host Card Emulation in the latest version of its Android operating system, effectively removing the need for access to the telco-controlled Secure Element.
With contactless and NFC based security fears, Google isn't helping here. I also wonder if this will have an impact on the way carriers sell devices? Will they want to push Android 4.4 devices in light of this? Or, as I suspect, they will start to focus
sales efforts on iPhones and Windows Phone devices more...Will we see less Android devices on the shelves?? Maybe, so this could be a massive risk to Google, and an odd one since their wallet as of late seems to be backing away from NFC...
This seems not to be yet another service, but a serious attempt bypassing SME’s to get access to consumers smartphones for payments. Especially when it can proof EMVCO payments emulated by HCE. Security is a main topic, but not the blocking one. Adoption
through 1. ease of use, 2. daily relevance, 3. added value services and 4. Low transactional costs are key elements for success. Let’s see when the first launching customer and set of consumers start using it for ‘Tap & Pay’ payments. And, once HCE is adopted
for payments, consumers will star using this for related services like loyalty and check-in/out.
Sounds like another naïve Google's initiative ...
This is how current Google Cloud looks like:
Unfortunately there are vested interests on both sides of this story but simple "it's not secure!" or "Visa MC will never allow it!" comments are somewhat misinformed and don't assist in a healthy debate.
I'd also encourage readers to review Tom's blog at:
I think he reads the situation perfectly and there's also a healthy and reasoned debate in the comments that follow.
It's a good article. But at no point does any of these NFC enhancements address the core issues businesses/people have with the technology
1. No added value to a merchant at all
2. No incentive for a merchant to adopt NFC / mobile
3. Security IS an issue and will become increasingly so if NFC gains any real traction
4. Risk increases to merchants
5. Up-front investment required for a merchant
6. Consumer experience is no more improved compared to standard contactless experience today
7. Does not address multiple sales channels
8. Integration with other business service providers. Just isnt possible
This is simply a way for Google and card schemes to try and cut carriers out of the mobile space, and they are doing it by redefining their own rules. I hope Apple doesnt follow suite and look to do this, rather they continue to move forward and look further
into the future than NFC. For me, NFC is fast becoming the Mini-disc of the payments world...
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© Finextra Research 2013