Just announced right now at their NY offices, Google’s NFC payments system – Google Wallet. Expected to launch in September this year, the service will allow Google Andoird users to pay using their phone at a number of retail stores.
Google have partnered with Citibank, MasterCard, FirstData and Sprint for launch meaning that only Sprint users with a Citbank credit card will be able to use this from the start. This is being billed as an open platform and other payment providers and banks are being encouraged to get involved. Launch retail partners include Subway, Duane Reade, Footlocker and ToysRus starting in New York and moving San Francisco shortly afterwards.
One of the more interesting features is the tie in with Google Offers and rewards which has also just been announced. This allows you to redeem offers at the same time as paying and also collect loyalty rewards electronically rather than carrying a myriad of cards to be stamped manually.
Let’s see if Apple make their announcement at WWDC and whether its an “open” platform
It’s official – just announced now at Google IO.
As per all the rumours it allows you to upload your music via a desktop manager, then play in the browser, tablets and mobiles. It’s also able to create 25 track playlists based on audio data and not artist similarity. They are allowing you to upload up to 20,000 songs. Launch will be invitation only for US users. Free during beta.
But, there’s no music for sale….yet.
The press has been awash with details of the Google music service since late last night. Predictions have been around the introduction of an unlicensed cloud locker service that allows users to upload 50GB of music for free. Just announced now at Google IO was something that no one had predicted, Movies.
Google have just announced a Google Movies service within the marketplace in the next few weeks that allows users to link movie rentals to their Google account meaning that they can rent anywhere and watch anywhere. Works online, on tablets and on mobiles.
Users will be able to “pin” movies to a device to allow them to watch offline when out of streaming range. Rentals will cost about $2 and be standard streaming rental terms of 30 days (reduced to 24 hours after first viewing commences).
Seems like today has been a day for inadvertently gathering mobile knowledge, I found out the following:
1) China One Mobile is the world’s largest mobile phone company with over 600 million subscribers as of today. In comparison AT&T in the US has around 95.5 million and the largest UK mobile Telecom Everything Everywhere has only 28 million. In China the second and third largest mobile providers still have around 170 million and 95 million customers each respectively.
2) Apple have sold over 18 million iPhones since Christmas – their largest area of growth was in China at 250% .
3) The Chinese ecosystem for Android apps is massively fragmented. As there are so many devices on the market they don’t all get approved by Google so don’t get to install the Android Marketplace. There are hundreds of sites offering .APK files for manual installation. This must make updating applications a nightmare to manage and would probably lead to many installed apps never getting updated. Has anybody created a centralised system for managing the distribution of applications to multiple app marketplaces yet?
4) Of China Mobile’s 600 million users 476 million used it’s wireless music service over the last quarter which offers downloads from 2 yuan – approx £0.20/$0.30. Meanwhile Apple also took over $1.4 billion through iTunes alone which is neither linked to mobile or China directly, but I find it an astonishing figure that cements the importance of a well executed content strategy on any platform.
5) Much of the growth for China Mobile is into rural areas, they have said they will spend up to 132b yuan (£12b) on their network in rural areas to maintain their lead over China Telecom and China Unicom, it’s closest competitors.
The renewed thought of Amazon creating their own device has made me realise how they are actually one of only a handful of companies currently able to challenge Apple’s dominance in the device arena, specifically around the emerging field of contact-less payments.
The next iPhone purportedly contains NFC technology which would allow the device to act as a contact-less payment method. This is already currently available in some Android devices, but due to the open nature of the platform there’s no single company who is going to actually implement the underlying payment service.
In order to own an iPhone you need to have an iTunes account, whilst it’s not necessary to add a card to the account I would expect all of those users who own an iPhone (or an iPad) will have at least one card registered. Apple can therefore hit the ground running with the iPhone 5 and become one if the biggest payment services in the world overnight.
Google on the other hand have little to challenge with in comparison, they have never really dealt with consumer transactions at scale; Google Checkout has never found much traction against Paypal. Due to the open nature of the Android OS, operators will want to build their own solution to charge purchases to their customer’s phone bills, which will serve to dilute Google’s ability to develop the Checkout platform.
Amazon, however, do have the customers, they also have a payment method for every single one of them. If they were to introduce an Amazon device this year, it would allow them to run head to head with the iPhone in what could potentially be the start of a very disruptive period for the finance industry.
Paypal are in a strong position with their existing user accounts for payments but obviously aren’t into manufacturing devices. They could benefit from either a manufacturer tie in or creating device specific apps that use the NFC chip to charge the user’s Paypal account. Consumer adoption is likely to be limited and the experience would be second rate to one at device level.
Facebook have recently brought on Goldmann Sachs as an investor which could potentially be linked to their strengthening of Facebook credits which, this year, will become mandatory for any purchasing inside Facebook apps. ASOS and now French Connection have built complete eCommerce platforms inside of Facebook and if it’s users are buying credits to use inside these Facebook apps this has the potential to make Facebook one of the biggest banks in the world. If that’s the case then I wouldn’t be surprised if we see them start using NFC technology which coupled with the Facebook Places/Deals platform would make them a strong contender in this race.
NFC based payments itself could pull up lame at the first hurdle as the entire success or failure of all of this rests on adoption of the technology by both the retailers and more importantly the consumers.
Amazon have announced that they are to offer free unlimited streaming movie and TV show to Prime customers in the US . The are offering about 5000 videos including many of the usual TV series, The Sopranos, The Office, Friends etc. The movies aren’t big new hits but do contain some fairly recent releases. Non of this is new to Amazon though, they have had the Unbox service for some time (now rebranded as Video on Demand) which has the big hits for rental, but this is a great way to introduce some new customers to that service. The device support is great, there are a lot of supported systems most of which are connected TVs or media centres but they also offer the option of Windows Media so you can stream via a Windows PC or an Xbox.
As I mentioned previously, following the complete acquisition of Lovefilm, Amazon looks to be on the start of a major content play which in my opinion signals them taking a serious step into the world of connected devices. The signs are all mounting up for an Amazon device to be released or even set of devices:
- Amazon bought touchscreen technology specialists TouchCo at the start of last year and have previously stated that they weren’t going to integrate these capabilities into the Kindle product line….so where are they planning to use them?
- Lab126 is the arm of Amazon that developed the Kindle and it’s thought that is where the next generation devices are being designed and built. They have been on a hiring frenzy since last year for engineers.
- Amazon’s App store is due to launch soon and the developer portal is now open for content submissions. They are planning to run a similar 70:30 split like Apple for developers wanting to sell their apps. Apps will be sold inside the regular Amazon store.
- The Amazon MP3 store and Kindle bookstore have been around for ages and will be staple additions to any hardware release.
The talk of an Amazon device has gone quiet of late but I wouldn’t be surprised if that rumour mill kicks up again following today’s announcement of an Apple press event on March 2nd – rumoured to be the iPad 2 launch.
So the internet has been awash with condemnation at Apple’s recent decision to impose it’s monopolistic tactics onto content publishers with their announcement to kiabosh any out of app purchasing. And somewhat rightly so; 30% is a lot of margin to be giving away, especially when the margins are so tight anyway that a sale can often result in a loss.
The fanbois may argue that Apple has the right to charge what they want as they have spent money building their platform over the years and I would say that they are right. Apple spent
millions billions in R&D to create the iPhone, iPod, iPad and the iOS and it’s their prerogative to make it work for them financially.
However, that’s certainly not to say that publishers should just stand by and let the “suits” from Infinite Loop have their own way. The music industry learnt this lesson a long time ago, after they let Apple define the rules and set the path for digital music downloads for almost a decade. It finally seems to have started to pick itself up and work its way out of that hole, although I do worry it’s is a bit like an absentminded old man who regularly forgets that the kettle gets hot when its boiled and happily picks it up with both hands whenever it whistles.
Apple won’t drop their prices voluntarily, despite mounting pressure and the more favourable Google rates, because they just don’t have to. Unfortunately it isn’t a fair market so they won’t be forced to change their pricing through natural market forces. My point here is, that if publishers don’t like the 30% surcharge that Apple is about to impose then they should pull their content from the platform. If no one provides their content through iOS devices then those devices become less appealing and as happens in a normal fair market economy Apple will be forced to drop their prices to get the publishers back on board.
Working for an iTunes competitor I am somewhat biased on this, but if the already slightly senile music industry doesn’t want Apple to right the rules for the subscription streaming market in the same way it did with a la carte downloads then they should stand their ground. They should look to pull their content from the iTunes platform or at least stop the impending Apple streaming service from launching. Services like Spotify, MOG, Rdio at al. won’t be able to afford to give £3 per month to Apple whilst giving the lions share to the labels. The aforementioned must also avoid backing down on what they take from music subscriptions just to make this work under the Apple dictatorship or they’ll end up bending over again while the Cupertino giant gets its way.