Skip to main content

Google is in talks to buy mobile payments company Softcard to fend off Apple Pay

Mobile payments
Image used with permission by copyright holder
Google is girding its loins for an all-out mobile payments war with Apple and others, and its next move appears to be acquiring current competitor Softcard. The move would help Google fend off Apple’s growing mobile payments market share, while allowing it to overcome some competition and hurdles it currently faces.

Softcard (formerly and unfortunately named Isis), the mobile payments company jointly owned by AT&T, Verizon Wireless and T-Mobile USA, laid off more than 60 employees last week and told its remaining employees to cease working until a buyer was found, according to The Wall Street Journal.

That buyer appears to be Google, which recently offered to purchase Softcard for $50 million. PayPal expressed interest in buying Softcard, but the telecom companies behind Softcard prefer Google because they all sell phones that run Google’s Android mobile operating system. Google also has a revenue-sharing model related to mobile searches and its Play store in place with the companies behind Softcard.

Acquiring Softcard would remove a thorn in Google’s side, as its Wallet mobile payment service has suffered partly because of telecom companies’ unwillingness to help. Instead, they decided to launch their own mobile payments solution in Softcard, which has also struggled to gain sure footing.

The acquisition would also reopen previously derailed discussions between Google and the telecom companies regarding the use of data on mobile purchase behavior in physical stores to improve digital advertising targeting and the sharing of this ad revenue.

Google also appears to be interested in Softcard’s more than 120 patents and applications for patents, according to TechCrunch.

“It’s unfortunate that they’ve chosen now as a time to scale back,” according to Ed Busby, Softcard’s former chief commerce officer, who spoke with TechCrunch about the potential deal. “Externally, for the first time since I’ve been in this industry, the signs are pointing positively for mobile payments.”

Apple’s mobile payments service, Apple Pay, launched in late October and has given the company 1.7 percent of the mobile payments market, according to research firm ITG. Google’s three-year-old Wallet maintains a lead over Apple with about 4.0 percent of the market, but an ITG analyst said Apple Pay users are more engaged, which bodes well for its future. PayPal currently has a healthy lead over both Apple and Google with 78 percent of the market, while Square holds 18 percent of the market.

The U.S. mobile payments market is expected to grow to $142 billion in 2019, according to research firm Forrester. It currently stands at about $50 billion.

Editors' Recommendations

Jason Hahn
Jason Hahn is a part-time freelance writer based in New Jersey. He earned his master's degree in journalism at Northwestern…
A long-awaited Apple Pay feature is finally on your iPhone
Apple Pay Later

Apple announced Apple Pay Later last year when it revealed iOS 16 at WWDC 2022. The feature is finally rolling out to “randomly selected users” as of today, through a prerelease version of Apple Pay Later in the Wallet app. Those who have access to this prerelease version should have received an email to their Apple ID account, and they will need iOS 16.4 and iPadOS 16.4.

This is a prerelease version of Apple Pay Later, and the full service will be rolling out to eligible iPhone users older than 18 in the U.S. in the “coming months.”

Read more
Google’s failing Pixel ecosystem is the key to beating Apple
Google Pixel 7 Pro and Pixel Watch.

The Apple ecosystem remains one of the more powerful ecosystems you can find, but Google this month reminded us at CES 2023 that its Google ecosystem is just as powerful. And it's only getting better.

Not simply that, but it's an ecosystem that's independent of Google. Though it has distinct ties to the company, it can survive without buying a single piece of Google hardware — and that is where its value ultimately lies.
Why Apple's ecosystem lock-in is so good

Read more
In 2023, it’s time to finally ditch your real wallet for Apple Pay
Front of Apple Card

In the early 2000s, the U.S. started accepting contactless payments at credit card terminals, which used near-field communication (NFC) technology to make it happen. However, it was still too early and not widely adopted until 2008, when the major credit card companies began to offer contactless credit cards.

But contactless payments continued to evolve. Soon enough, Apple added Apple Pay in 2014, allowing you to add your credit and debit cards in the digital Wallet app and pay with your phone. There is also Google Pay for Android devices, and even Samsung has its own version of mobile payments called Samsung Pay.

Read more