American Express Co.'s deal to buy Revolution Money Inc. is a long-term bet on emerging technologies and proof that the card giant is rebounding from a painful period.

With a $300 million price tag, "we see Revolution Money as a small acquisition, but one with big potential," Kenneth Chenault, Amex's chairman and chief executive, told reporters on a conference call Wednesday.

"If you were designing a payments platform today from scratch, you would do a lot of the things that have been built into Revolution Money."

Started two years ago with the backing of AOL co-founder Steve Case, Revolution Money operates an alternative payments network, including an online person-to-person money transfer service and a credit card.

It would become the first component of a new "enterprise growth" group at Amex, announced last month, that is focused on emerging payments.

"It's a signaling move because it means that there's an understanding that American Express needs to keep growing and considering alternate forms of payments," said Joseph I. Rosenbaum, a partner and the co-chairman of Reed Smith LLP's global advertising, technology and media law practice, and a former senior counsel at Amex.

"At the same time it's going to be interesting to see whether this becomes the beginning of a successful 'revolution' in their stable of products and services. That will depend in great measure on whether they are able to implement and execute on the strategy."

Amex, which offers no debit or major prepaid cards other than its gift cards, has long relied on its core products — reward credit cards and charge cards — to appeal to high-spending consumers. That model has taken several hits in recent years.

Debit cards have become more popular than credit. The recession has prompted consumers to pull back on discretionary spending. And noncard payments services such as eBay Inc.'s PayPal Inc. are capturing a bigger share of online spending.

Amex "did miss out … on the debit card boom that really has occurred over the last five to 10 years, and I think they want to be on the forefront of the new wave," said Michael Taiano, an analyst at Sandler O'Neill & Partners LP. "At some point people will move from debit cards, and we know it will be electronic. Technology is evolving quickly, and if you don't see that coming, you can lose share pretty fast. It's an investment for the future and not much more than that in the near term."

Even as the recession wanes, Taiano said, "consumer spending in the U.S. is going to be not what it once was, and the lending component is not going to be as much of a demand, so really the growth arena is squarely on a couple of things," including the emerging payments area.

The privately held Revolution, of St. Petersburg, Fla., said it has signed up 400,000 consumers but would not say how many of its cards are in circulation or share any of its financial results. Chenault would not explain how Amex arrived at the $300 million purchase price.

The deal is "small," relatively speaking, for Amex, which paid $1.1 billion last year for General Electric Co.'s corporate card unit. In December, soon after Amex slashed 7,000 jobs and attacked other costs, the New York company paid more than $1 billion to retain the Delta Air Lines Inc. cobrand portfolio.

Even so, observers said the deal augured well for Amex's recovery. "The company is serious about investing for future growth," Taiano said.

But the news mystified more than one industry member, several of whom said the deal's benefits were much more obvious for Revolution Money than for Amex.

"I don't see it," said Philip J. Philliou, a former Amex executive and a partner in the consulting firm Philliou Selwanes Partners LLC.

"Revolution Money isn't the company that comes to mind when I think of innovative products that have succeeded in the marketplace to date," Philliou said. "I guess I commend them for bringing in new talent, but as far as purchasing a new platform that's going to fundamentally change the way they do business, to my mind that's suspect."

Beth Robertson, the director of payments research at Javelin Strategy and Research, agreed that Revolution Money is not as well established as other alternative-payments companies.

"There are organizations with a stronger position in the alternative payments market and maybe a wider array of existing functionalities, but that doesn't mean that American Express can't do something with this," Robertson said.

But other factors could have swayed Amex, she said. "It could be the price point, it could be the fit of the management."

Last month Revolution Money announced an issuing partnership with Fifth Third Bancorp of Cincinnati. Chenault said Wednesday that Revolution Money "fits very well" with Amex's third-party network unit and "builds out the offerings that we can provide banks."

Jason Hogg, Revolution Money's founder and CEO, said he believes Fifth Third is "excited to obviously have us become part of the American Express family." A Fifth Third spokeswoman said, "We continue to support the RevolutionCard," but would not comment further.

Stephen Squeri, Amex's president of global services and chief information officer, said Revolution would help it develop products, including reloadable prepaid cards, to reach teenagers and other "younger" segments "that we don't necessarily reach today. … It fits in as a very nice sort of entry-level strategy to our traditional card products."

But Chenault said Amex is as interested in the brains behind Revolution as the technology it has built.

"Revolution Money also possesses an incredibly valuable hidden asset for American Express. One is a group of talented individuals who can bring us fresh, outside perspectives on how to grow for the future," he told reporters.

Hogg would remain in charge at Revolution Money after the deal is completed. It is expected to close next quarter.

Amex also said Ted Leonsis, Revolution Money's chairman and a major shareholder in the outfit, would become a special adviser, "working with Mr. Chenault on overall digital and online payments strategy."

Since 2007, Revolution has marketed a credit card with heightened security features — cardholders authorize transactions with PINs and the cards do not display their names or account numbers. The rewards program is funded by merchants, who pay a relatively low acceptance cost of 50 basis points per transaction. That pricing level, of course, is at the other end of the spectrum from Amex's higher-than-average interchange.

It is "too early to tell" whether the Revolution brand will survive, Chenault said, but he is "absolutely not" concerned about cannibalizing Amex's interchange model.

"We want to provide a range of options and choices for our customers and our merchants. We price on value," he said.

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