Crowded arena

As "The Payoff" has emphasized before, a host of companies are jockeying for position to profit from the anticipated transition to digital payment systems: traditional credit card companies; banks; startups eager to leverage electronic capabilities to squeeze out the high costs of old-line payment approaches; and several of the world's best-capitalized tech companies, including Apple, Amazon, PayPal, Starbucks, and Isis. Google has simultaneously been as aggressive as any of these, and received more attention than any other for its missteps.

Those stumbles include:

• evident ambivalence by such Google Wallet partners as American Express, who seem to be withholding much commitment until Google Wallet demonstrates more success;
• an engineering error that left many Android handsets unable to operate Google Wallet at all;
• falling behind tiny-but-fast-growing rival Square in market acceptance;
• consumer confusion about NFC (near-field communications), the wireless standard that makes it possible for Google Wallet to offer "touch-and-go" purchases;
• an apparent retreat by Sprint, the only carrier that had been installing Google Wallet by default on handsets it sold;
• severe security flaws in early releases of Google Wallet;
• questions about its policy and procedures for mitigating damage when (not if) an updated Google Wallet is stolen;
• stalls in the count of vendors who accept Google Wallet;
• postings in popular on-line tech magazine ZDNet and Tom's IT Pro about the crippling clumsiness of Google Wallet; and
• internal dissonance at Google Wallet sufficient that at least two leaders have already left to found their own payments company.

Google gives no sign of giving up, though: this spring it acquired payments company TxVia, Google Wallet appears still to be hiring, and it has kept up a steady stream of press releases and updates. Almost without exception, serious external commentators on Google Wallet with whom I've spoken want the company to fix the product, not eliminate it.

Will Google come out on top? No one yet knows. Point-of-sale (POS) is an exciting place to be now, though, as a wealth of experiments aim to provide convenience to consumers, lower transactional costs to retailers, and secure operations to all. Potentially even more dramatic will be the changes once a winner emerges: at that point, the strategic emphasis will shift from cost-saving to "real-time" use of purchasing data to improve customer relations, logistics, and business opportunities. Stay tuned.

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Notice, by the way, that "The Payoff" now appears every other Thursday. During its launch, the "The Payoff" ran each Thursday--once a week--for its first quarter. Now it's time to switch to a slightly more relaxed pace that provides more scope to interview industry insiders and detail payments technology in a bit more depth.