Google Tackles Trailing Wallet Problem, Considers SoftCard To Compete With Apple Pay
As of right now, Google is pretty much sitting on the sidelines of the emerging mobile payment market while Apple and its Apple Pay system make headway. Ah, but maybe not for long -- it's being reported that Google has strong interest in acquiring Softcard, the mobile payments firm that was previously known as Isis.
Citing un-named sources that are presumably "familiar with the situation," TechCrunch says the price might be under $100 million. If true, it would be a drop in the bucket for a company like Google, which raked in nearly $60 billion in revenue in 2013, and will likely report an even higher number for 2014 once all the figures are tallied.
Softcard may not be able to command as much as it wants due to its current troubles. It reportedly received hundreds of millions of dollars in a joint venture consisting of AT&T, Verizon, and T-Mobile, yet had to hand out around 60 pink slips earlier this month as part of a consolidation phase to "reduce costs and strengthen its business." If Google's going to strike, now might be the best time to do it. But will it happen?
"We don't have a comment, background, deep background, off the record steer, nod, wink, or any other verbal or non-verbal response to these sorts of rumors," the company said.
There isn't really anything to read between the lines there, which is typical when it comes to rumors and speculation. However, this would be a good chance for Google to get in the game. Softcard's system is based on a contactless NFC mobile payments system, like Apple Pay, and has over 200,000 merchants in the U.S., including places like Subway and McDonalds. Its app is available for Android and Windows Phone, but not iPhone devices.
A takeover by Google would also be a boon to employee morale.
"People at Softcard have a limited view of what's going on," one of the sources said. "The whole place has been in a complete depression for at least six to eight months, to the point where people weren't coming to work, and were being told in December to take it easy through the end of the year. In general, it's not a culture with a lot of transparency, so a lot of people are thinking the worst."
If not Google, it's possible that Microsoft or PayPal could swoop in and acquire Softcard, both of which have reportedly approached Softcard.