The race for the next big thing in the mobile payment space is only but heating up after Google Inc. (NASDAQ:GOOGL) showed the clearest of indication that it is ready rival Apple Inc. (NASDAQ:AAPL)’s Apple Pay with its own offering. Fox Business, Deirdre Bolton, reports that the giant search engine company is willing to spend up to $100 million on a mobile payment startup as it seeks to tap into the market place potential.
“Apple has Apple Pay sources say Google wants to have a better competing product. A while ago AT&T Inc. (NYSE:T), Verizon Communications Inc. (NYSE:VZ), T-Mobile US Inc. (NYSE:TMUS) invested in a company ISIS changed the name to Softcard. Google could may buy it for $100 million,” said Mrs. Bolton
NewOak Capital President, James Frischling, believes Google might have been convinced to enter the mobile payment space by the substantial gains that Apple Inc. (NASDAQ:AAPL) has enjoyed, just months after unveiling Apple Pay. Frischling expects Apple’s investments in the space to benefit other players like Google who will now have a clear idea of what to do and not to do in the long term.
The analyst does not expect Google Inc. (NASDAQ:GOOGL) to position Softcard as a standalone company but a system that should supplement its other operations. Frischling also did raise concerns about Apple Inc. (NASDAQ:AAPL) and Google being outdone by banks in the fast growing space. Banks are still expected to form the backbone of the mobile payment space as most of the transactions will be initiated through their systems.
“[..] I worry about both of these guys Apple and Google Inc. (NASDAQ:GOOGL) just being outdone by the banks directly, that we can use their own pay service. However, I do believe there is room in this market for more than Apple Pay in fact I think Apple Pay is clearing the way to having Google more welcomed in this space,” said Mr. Frischling.
Retail analyst, Hitha Herzog, is on the other hand of the opinion that banks will be the biggest losers of the ongoing frenzy on mobile payments systems especially in the retail space.
Penn Financial Group founder, Matt McCall, on the other hand, expects Apple Inc. (NASDAQ:AAPL)’s Apple Pay to be a clear winner having already accrued a substantial amount of market share. Google Inc. (NASDAQ:GOOGL) could on the hand offer the biggest headwind to Apple Pay’s potential dominance based on the fact that it controls the smartphone marketplace with Android powered devices.
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