Amex Continues Innovation Push With Recent Acquisition

When American Express Co. introduced its digital wallet Serve earlier this year, the company promised to enhance the product with acquisitions and partnerships that added more functionality to the platform.

Amex’s latest purchase, virtual currency firm Sometrics Inc., for $30 million will help Serve tap into a market in the U.S. that secures $2 billion in annual in-game microtransactions in titles from developers such as PopCap Games Inc. and Zynga Game Network Inc. (see story).

One of the reasons behind the purchase is to make Serve a payment option when buying virtual goods in electronic games. Amex also views Sometrics’ platform as a way to fund a Serve account, Jason Hogg, president of the company’s Serve Enterprises, tells PaymentsSource.

To use Serve, users first enroll by linking any bank or card account and choosing which to use to fund each payment. They receive a card for use at the point of sale, an account number to use online and an application that supports person-to-person payments from Apple Inc. iPhones and handsets that use Google Inc.’s Android operating system (see story).

Amex is seeking to bring multiple payment options under one roof so consumers using Serve have a single access point to pay for goods and services, Hogg says. For example, Amex’s partnership with Payfone would enable consumers to charge transactions to their mobile bill. Payfone is another payment option within Serve.

Instead of consumers accessing different payment options across multiple media such as online and mobile, Amex is creating a seamless experience for the consumer, Hogg believes.

“Our goal is for the consumer to have one seamless and fluid mechanism by which how they would like to transact,” he says.

Sometrics reaches some 250 million consumers worldwide and is used across 450 games, according to Ian Swanson, the company’s CEO. Last year, those users purchased 2 trillion units of virtual currency, up from 1 trillion the previous two years combined, Swanson adds.

Sometrics’ enables users to fund its mobile wallet using more than 80 different methods, including mobile-carrier billing, credit and debit cards, and prepaid options, Swanson says.

Amex’s acquisition of Sometrics also may help push Serve outside the U.S.

Dan Schulman, Amex group president for enterprise growth, told PaymentsSource in April the company intends to roll out Serve to several key international markets by the end of the year. This came after Amex invested an undisclosed amount into Payfone (see story).

Serve can help the company enter developing economies such as India, where credit and charge cards are a small part of the payments infrastructure and there is a move to mobile payments, Schulman said.

As Amex continues to push product innovation with Serve, the company will continue to pursue acquisitions and partnerships to advance that plan, Hogg says. And they will happen at a rapid pace, he adds.

“We really are promoting a culture of continuous release” regarding enhancements for Serve, Hogg says.

What do you think about this? Send us your feedback. Click Here.