Android Pay, a new mobile payment system introduced by Google as part of its latest smartphone operating system, is not a game changer for the sector a senior Ovum analyst said.
Gilles Ubaghs, a senior analyst covering financial services technology, noted Google has closely followed Apple's mobile payment model with its new service, making it likely that Android Pay will suffer the same sluggish uptake as Apple Pay despite several positive features in the Google service.
"Feature wise, Android Pay is nearly identical to Apple Pay, with transactions made via NFC on proximity payment which authenticated via PIN or biometrics on capable devices, and the ability to integrate payments into mobile commerce sites and applications," Ubaghs wrote in a research note.
The Android Pay app will create virtual account numbers for credit and debit cards registered by users to enhance security, and will also be available for in-app purchases for companies selling physical goods and services, sister publication FierceWireless reported.
David Burke, a VP of engineering at Google, said Android Pay will also connect to existing mobile banking apps, and that the app will be preloaded on devices from leading U.S. wireless operators, FierceWireless added.
Ubaghs questioned whether Google's decision to release Android Pay APIs to its developer community is as big a point of differentiation as the company would have us believe. "Apple Pay also has an API open to developers and can be integrated into online and mobile payment gateways via processors such as Braintree and Authorise.Net," he said, adding: "It remains to be seen how developers will take to this and what may emerge."
On the plus side, Android Pay's close resemblance to Apple Pay means that merchants already signed up to the Apple product may view Google's version as "a natural extension that will broaden the market," Ubaghs said.
Google announced the payment service during the unveiling of Android M, the latest evolution of its smartphone operating system, at its annual I/O developer conference, FierceWireless reported.
Sundar Pichai, SVP of products at Google, said the company aimed to improve Android users' experience with the latest platform, which is scheduled for release during the third quarter of 2015.
For more:
- see this Ovum statement
- view this FierceWireless article
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