Reports suggest that Google is interested in
taking over mobile payment service, SoftCard, and a $100 million deal
might be on the cards.
SoftCard, previously known as ISIS, was forced to change its name
after a militant group known as "Islamic State of Iraq and Syria”
started making headlines for all the wrong reasons. Softcard is a joint
venture between AT&T Inc., Verizon Communications Inc., and T-Mobile
US Inc. The mobile wallet has Windows and Android smartphone
compatibility, and allows users to make payments through various payment
terminal.
Google Inc and SoftCard have refused to comment on a possible deal.
"We don't have a comment, background, deep background, off-the-record
steer, nod, wink or any other verbal or nonverbal response to these
sorts of rumors," said a Google spokesperson.
At present, SoftCard is accepted by more than 200,000 merchants in
the US, including big names like Subway and McDonald's. The service is
backed by American Express Company, Wells Fargo & Co, and several
other financial institutions in the market.
Google currently has its own mobile payment system called Google
Wallet, which was one of the first mobile payment option in the retail
market. However, the Google Wallet has failed to gain much traction.
The wireless carrier owned SoftCard hasn’t fared better. Reports
suggest that SoftCard axed 60 jobs last week, and at one point the
company’s burn rate was approximately $15 million a month, or half a
million dollars per day. Morale in the company is at an all time low.
“SoftCard is taking steps to reduce costs and strengthen its
business. This includes simplifying the company’s organizational
structure and consolidating all operations into its Dallas and New York
offices, which involves layoffs across the company,” said a SoftCard
spokesperson
.
Apple Inc.'s Apple Pay - mobile payment service for iPhone users – has had better
success, with reports suggesting that one million credit card users
utilized this service within 72 hours of the service’s launch in October
2014. This surge has also benefited SoftCard, with a greater number
utilizing the service.
It looks like Google is also looking to capture a larger share of the
mobile payment sector. The tech giant may also be eyeing SoftCard’s
group of patents, which are a little over 120. With the acquisition,
Google will be looking to expand its roots, and add new merchants to its
mobile payment service.
