'Payment-Capable' Android Phones Multiply—but Not for Google Wallet

Google, like its mobile-pay rival Isis, relies on phones built with Near Field Communication chips to support its mobile wallet. So the growing number of NFC-equipped phones should give the Google Wallet a strong boost — shouldn't it?

Samsung, Sony and Motorola Mobility revealed new Android-based smartphones with NFC chips, which should be good news for Google Wallet. After all, a year after Google Wallet's launch, only six smartphone models support Google Wallet payments.

However, the new phones from all three manufacturers will not initially support point of sale payments, despite having the necessary hardware — and despite Google's ownership of Motorola Mobility, which announced three NFC-equipped Android smartphones Sept. 5.

"There are a lot of uses for NFC that go well beyond payments, and I think payments will still take a few more years to take hold," says David Kaminsky, analyst for emerging payments with Boston-based Mercator Advisory Group.

That theory would carry even more weight if Apple Inc. chooses to leave NFC technology out of its next iPhone 5, which it will likely announce next week. Though Apple has many patents for an NFC-based iWallet, it has yet to confirm any NFC-based payment plans despite years of rumors. 

The Google Wallet app allows users of certain NFC-equipped Android smartphones to make payments from a linked card account by waving the phone near a special reader at the point of sale.

In a recently posted video about Google Wallet developments, Robin Dua, head of project management for Google Wallet, predicted that all smartphones will have NFC technology in the near future. Dua also said Google would soon announce more carriers and devices for the mobile wallet.

Dua is accurate in his assessment of future NFC devices, Kaminsky says. "In the near future, all smartphones will have NFC, but not just for payments," he notes.

Google currently promotes NFC, which in Android phones it calls 'Beam,' in advertisements that show people sharing photos wirelessly, Kaminsky says.

Currently, Google Wallet operates on only six phones available for use with the Sprint and Virgin Mobile networks – the Samsung Nexus, Galaxy Nexus and Galaxy S III on Sprint, the LG Viper 4G LTE on Sprint, the HTC EVO 4G LTE on Sprint, and the LG Optimus Elite on Sprint and Virgin. In addition, consumers can operate Google Wallet through Google's Wi-Fi-only Nexus 7 tablet, which is built by Asus.

Sierra Lovelace, a Google spokeswoman, says the company has no immediate announcement forthcoming about operating its wallet on any of the newly announced devices, and she could not reveal a specific timetable for announcing Google Wallet support on other handsets.

"I think what Robin Dua was suggesting is that NFC will become a standard feature of smartphones moving forward, much like cameras have become a standard feature on mobile phones today," Lovelace said in an e-mail.

The reason Motorola's new phones may lack Google Wallet is that they will operate exclusively through the 4G LTE network of Verizon, which has resisted allowing Google Wallet on its network.

A Motorola spokesperson did not respond to inquiries about Google Wallet support before deadline, however the press release touting the new Droid Razr M, Droid Razr HD, and Droid Razr Maxx HD makes no mention of Google Wallet or Isis capabilities. The announcement simply says the phones are NFC-enabled “so customers can send contacts, links, maps and more, directly to phones with Android Beam.”

Meanwhile, there seems to be some progress for Isis, the mobile-payments venture created by AT&T Inc., Verizon Wireless and T-Mobile USA. MasterCard Inc. for the first time listed NFC-equipped phones it has approved for use with the Isis wallet.

Not surprisingly, the phones approved for Isis operation represent key smartphones offered by the participating telcos – the HTC Droid Incredible 4G LTE on the Verizon network, the HTC One X on AT&T, the HTC Amaze 4G and Samsung Galaxy S II on T-Mobile, and the Samsung Galaxy S III on all three networks.

Only Google technicians know the particulars of what is involved in establishing operation of the Google Wallet on an NFC device, Kaminsky says. "But there should be some concern that it is only available on six handsets and that the major telecommunications companies are invested in Isis," he adds.

MasterCard's approval of the Isis phones (pdf) fuels more speculation that Isis is getting close to starting its tests in Salt Lake City and Austin, Texas. Even though Isis has consistently declared the pilot launches would unfold "this summer," recent announcements of a late September launch suggest delays in getting technology issues and issuer negotiations resolved. 

At the recent IFA, or Berlin Radio Show, in Germany, Samsung said NFC would be a component of the Galaxy Note II, an Android phone. Samsung's "Ativ" smartphones and tablets, which run Windows 8, will also have NFC technology. 

Meanwhile, Sony unveiled NFC-enabled Xperia T and Xperia V Android smartphones. Sony's Vaio Tap 20 desktop touchscreen computer and its Vaio Duo II Ultrabook, both of which run Windows 8, also have NFC built-in.