BARCELONA, Spain--Google's (NASDAQ: GOOG) Sundar Pichai confirmed that the search giant will launch an MVNO in the U.S. on a limited basis in "the coming months" to spur innovation in the wireless market. Although Pichai did not say which operator or operators will provide the underlying connectivity, several reports last month indicated that the Sprint (NYSE: S) and T-Mobile US (NYSE:TMUS) will be Google's network partners.
"We don't intend to be a network operator at scale," Pichai said during an appearance here during the Mobile World Congress conference. He said that the core of everything Google does with Android is based on partners and taking an "ecosystem approach" and that "anything we do in connectivity would have the same attributes."
Pichai, Google's senior vice president of products, noted that Google has pushed the boundaries of software and hardware with its Nexus device program and that it is time to add connectivity to the mix. "We want to be able to experiment along these lines," he said.
"We're working with some partners to do what we're doing," Pichai said. "Carriers in the U.S. are what powers most of our Android phones, and that model works really well for us."
Pichai said Google envisions a wireless service that is a "bit different" and will be focused on making cellular and Wi-Fi connectivity experiences seamless. He also raised the idea of having dropped wireless calls reconnect automatically. He said some of the ideas that Google tries will work out and that the company hopes its carrier partners will adopt them in their own services.
A Wall Street Journal report from January said the Google MVNO service would hunt for the best available cellular or Wi-Fi signal to route voice, text-message and data traffic. Although the MVNO business model is widely used and commonplace in the wireless industry, and Sprint and T-Mobile have been champions of that model, Sprint is reportedly hedging its bet by putting a "volume trigger" into its contract with Google that would enable the deal to be renegotiated if Google's customer base grew too large, according to the WSJ. It's unclear whether T-Mobile has a similar arrangement.
Pichai also confirmed that the company is working on a new API called Android Pay to ensure that, for banks and credit card companies, payments services as part of Android apps can be handled in a standardized and consistent way that can be scaled globally. An Ars Techncia report from last week indicated that Google will launch the API at its I/O developer conference at the end for May. Pichai said that Android Pay will do things such as tokenize credit card details for security and ensure that authentication works. He said Google Wallet will be "a customer" of Android Pay but that it could support platforms like Samsung Pay or mobile payments services in China. Pichai added that it will support Near Field Communications technology but that NFC could eventually be replaced by other payment methods, including biometrics.
Additionally, Pichai touched on Project Loon, Google's project to deliver Internet access via balloons. When the project first launched balloons two years ago, the balloons struggled to stay up for five days and delivered only 3G connectivity. Today, he said, the balloons can stay afloat for 200 days, or about six months, and can deliver LTE connectivity. "We think the model is really beginning to work," he said, and Google is starting large-scale commercial tests, including with Vodafone and Telefónica in New Zealand and Telstra in Australia.
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