Monday, September 17, 2007

Google Files Patent Application for Mobile Payments

In what could be described as Google taking a page straight out of the PayPal playbook, Google filed for a patent that describes a mobile commerce system that is similar to existing mobile payment systems, including the mobile version of PayPal. The patent application is leading to renewed speculation about Google's wireless ambitions.

Someday, "to gpay" might mean making a payment using a text message over a mobile device. That's the form of e-commerce for which Google has filed a patent, in which the terms "gpay" and "gbuy" are used.
The application is leading to renewed speculation that Google has its sights set on a more active role in the mobile-device marketplace.

First filed in February of 2006, patent application number 20070203836 was published late last week. "The payment process may occur through the simple composition by the payor of a text message," such as a short message service (SMS), the application stated, with payee identification and payment amount then sent to a payment processing system" for debiting, crediting, or transferring funds.

Road Side Fruits and Vegetables

Some indications of Google's intended markets might be gleaned from several scenarios presented in the application.

In one scenario, at a farmer's market or a flea market, individual or family vendors sell low-priced products and typically only take cash. But such vendors are "also likely to have a cellular telephone or similar mobile device," Google's application noted, and, if given a preference, might prefer not to deal only with cash.

Instead of using cash, Google envisioned, both the fruit seller and the buyer use their mobile devices. The vendor would have an account with an online payment service and an identifier, such as a phone number or a screen name like "veggiegirl." The buyer can enter the vendor's identifier and the amount to be paid, and the vendor receives confirmation on her mobile device.

If the vendor feels the buyer is trying to "spoof" the system, the vendor can log on to the online payment system through her own device and confirm the transfer of funds. Google noted that the online payment system might be able to handle micropayments, and have attached bank, credit, or debit accounts.

Lucy, Mowing Service, Thirsty Student

Another possible scenario mentioned is an entrepreneurial "young lady," with apparent references to Lucy in the Peanuts comic strip, who offers psychiatric help at a street stand for a nickel per session. She might use the mobile device to organize and analyze her finances, as well as receive payments. And she might post two identifiers, so as to separate sales that require taxes and those that do not -- in effect, two cash registers.

In other scenarios, Google suggested the payment system might have an escrow feature. This could be handy, the application stated, if a young person's mowing service can be hired by a homeowner who might be wary of the quality of work and might want to present payment, but hold back delivery until the job is satisfactorily completed.

Other suggested scenarios include a "thirsty college student" paying at a soda vending machine, or a community honor system, where a mobile payment system relieves a worker of monitoring occasional transactions at, say, a community stamp box.