Google To Test Android Near-Field Mobile Payments

Bloomberg reported that the search engine will pay to have thousands of cash registers from VeriFone Systems installed at various businesses. These sales terminals would accept payments from Android smartphones fitted with chips and software based on near field communications (NFC), the short-range wireless technology used to enable communication between sensors in close proximity with each other.

Gingerbread NFC Internals

The project, which Google declined to confirm, hardly comes out of nowhere. Google CEO Eric Schmidt (pictured) said in November the Android 2.3 “Gingerbread” build would include NFC to allow consumers to take phones equipped with the operating system, tap them against objects and machines with NFC sensors to enable wireless data exchange, including payment for goods in stores.

In December, Google launched the Samsung Nexus S smartphone, the first based on Gingerbread, which has native NFC support.

Google began testing NFC from the Nexus S in Portland, Ore., but reading was limited to posters and signs. One month later, a job posting for an NFC specialist popped up on Google’s careers Webpage.

Now, Google could test fly NFC on Gingerbread handsets within the next four months, according to Bloomberg. Verifone and Google declined to comment on the speculation.

It is easy to understand why the search engine would want its users leveraging NFC on Android handsets. Such mobile payments are sort of a frictionless Holy Grail, allowing consumers to use their phones instead of lugging around credit cards in wallets.

Google, locked in tough competition with Apple in the mobile phone market, wants to lure as many developers and users to Android devices as possible.

NFC capabilities provide a compelling new opportunity for developers, who could charge for apps that enabled wireless payments from smartphones in stores. Good apps will bring in more end users, who will in turn be served more ads on Google’s ad network.

Europe And Asia Pushing NFC

While slow to materialise in the US, the market for mobile payments using NFC is huge in Japan and in parts of Europe despite the lack of a solid standard. For this reason, among others, stores have been unwilling to implement NFC-enabled computer systems.

Yet analysts expect the NFC-based mobile payment market to boom to multi-billion-dollar figures over the next few years, propelled by the AT&T and Verizon Wireless-backed ISIS platform.

Research in Motion and Nokia are all working hard on building NFC systems. Apple was also rumoured to be prepping NFC for the iPhone 5, but a new report from the Independent noted that the company is holding off because of the lack of an industry standard.