Google's Gpay patent is likely to fail

THE NEWS that Google is plotting to enter the mobile payments sector with a service called Gpay shocked few. The chances of its patent application succeeding, however, look rather thin.

Google's interest in this sector emerged when the US patent office published the company's patent application. It seems to cover a system whereby the purchaser sends a text to pay for goods.

And the merchant accepts the payment because it's all tied into a massive contra-deal with Google over online advertising.

At the INQ, we can recall paying for a meal in London's Circus restaurant by a system called Paybox back in 2001. It merely meant giving the waiter your mobile phone number, and then you got an automated phone call to the handset to confirm the amount.

After that a text arrived as your receipt. This system was completely cashless and very easy to use but Paybox gave up on it after three years through lack of support.

Most observers paint Google's initiative as an attempt to compete against Paypal. And it's not Google's only attempt at m-commerce. There's a mobile version of it Google Checkout service, too.

The latter only works with WAP sites, however. But Google is facing far more serious competition from entrenched m-commerce companies than from Paypal.

As Anil Malhotra, marketing VP with mobile payment fulfilment house, Bango, told the INQ, "The mobile industry met the micropayments challenge years ago."

Whereas the standard view towards paying for content on the fixed internet - as championed by Google - is through advertising, the same doesn't apply in the mobile sphere where content isn't free.

So Google seems to be contradicting itself in trying to introduce a cashless payment system via text which can be used for any kind of micropayment. Not just chewing gum, but MP3s or ringtones

As far as the Gpay patent's chances of being granted are concerned, the odds are unfavourable. "I can't see what more can be patented for payment by text," said Malhotra.

Bango has seen a big change in who's paying for mobile content. It reckons thirty per cent of purchases are now being made from outside the content provider's home territory. A year ago it was just five per cent.

Bango's Focus service operates in more than 150 different countries. Plus it doesn't rely on just one technology - such as Premium Rate SMS.

Companies like Bango found out years ago that basing a mobile payment system purely around text simply doesn't work. µ

L'INQ
Bango