Walmart nixes Google Wallet, Isis partnerships
Walmart, the world's largest retailer, said it is only interested in mobile commerce applications that offer multiple use cases, stating that partnering with third-party payment networks such as Google (NASDAQ:GOOG) Wallet and Isis doesn't make sense for its business.
Speaking this week at the RAMP Mobile Retail Services Summit, Walmart Vice President and Assistant Treasurer Mike Cook said the retailer will throw all of its weight behind the forthcoming Merchant Customer Exchange mobile commerce network, which teams the company with chains including Target, Best Buy, Sears and 7-Eleven. First announced in August, MCX is currently developing a cross-platform mobile app supporting smartphone-enabled purchases across all participating merchants as well as consumer offers, promotions and retail programs.
"MCX is more effective," Cook said. "One of the principles of MCX is that we wouldn't just replicate the fraud-prone system that's out there today." He added that embedding payment credentials in a secure element--the approach taken by Isis, the contactless payment initiative spearheaded by Verizon Wireless (NYSE:VZ), AT&T (NYSE:T) and T-Mobile USA--does not improve on the existing payment systems that cost retailers millions of dollars each year on data security compliance.
Mike Dudas, emerging business lead of mobile commerce at Google, asked Cook if Walmart see any value in collaborating with third-party efforts like Google Wallet. Cook nixed the idea, stating "I'm not sure there's a value-add or synergy there to make it work." He added that Walmart has no interest in sharing consumer and transaction data with additional partners, explaining "Many of the models out there today are just adding another mouth to feed."
While MCX has yet to divulge technological details of its service, Cook expressed major doubts that Near Field Communications offers a viable platform for mobile transactions. "You think about the technology that's out there today, there's no private equity funding that's following NFC," he said. "I may be wrong; we may see it, but I don't think [NFC is] becoming a technology that will handle payments."
Walmart is on pace for 2012 revenues of $447 billion, and currently ranks third on the Fortune 500. The Statistic Brain site reports that more than 100 million consumers shop at Walmart every week, spending $36 million in its stores every hour of every day. Last month, Reuters reported Walmart is currently trialing a new system enabling shoppers to scan items using their Apple (NASDAQ:AAPL) iPhone, then complete their purchase at a self-checkout counter.
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