Google Wallet Product Launch


STEPHANIE TILENIUS:
Welcome everyone. I’m Stephanie Tilenius
and I run commerce and payments at Google. I joined Google a little over
a year ago after spending nearly a decade at
eBay and PayPal. And I joined Google to
improve commerce for businesses and consumers. We are just getting started. Today we have some exciting news
to share with you around mobile and local commerce. If you remember nothing else
from today, here is what we’re going to share with you. Today we are announcing a couple
of products, Google Wallet and Google Offers. We’re extending an open
invitation to merchants and ecosystem partners, such as
payment networks, carriers, banks, to join us in creating
tomorrow’s best shopping experience. Now our belief is the world of
commerce, not just e-commerce but all commerce, is ripe for
a new wave of innovation. And we are announcing an open
platform for mobile and local commerce, which combines offers
and payments at the point of sale. It makes it easy for partners
and third parties to create great consumer experiences. And our goal is to bring
together all the pieces of the ecosystem and drive a great,
brand new shopping experience for everyone. Your phone will be
your wallet. Just tap, pay, and save. Now before we go into the
announcements, I thought we’d take a moment to step back and
talk about why this is just an amazing time for e-commerce. E-commerce is growing
like crazy. In the US, e-commerce surpassed
$227 billion in 2010, and it’s poised to exceed
$1 trillion by 2013. So where’s all this growth
coming from? Well initially, it was
leveraging html and other basic web technologies to
essentially bring retail online in a way that’s very
similar to the way we shop offline today. This started with Amazon and
eBay in the 90s, and then virtually every retail brand
has invested in building an e-commerce website, or
a full business. And more recently, luxury brands
are also coming online with Gilt and Vent-Privee and
other services that are doing private sales. So you’re literally seeing
every retail brand, every consumer merchant, every branded
experience offline come online. Now at the same time consumer
attitudes have changed, literally practically
180 degrees. 10 years ago 70% of consumers
would never pay online. If you interviewed them they’d
say that they were afraid of doing that. Today, over 70% of consumers
transact online and access their credit card information. But even though all the brands
are online and consumers are very comfortable paying online,
e-commerce is still only 8% of total retail. This means 92% happens offline
in the physical world. So why is this? Well we believe the shopping
experience hasn’t yet been transformed by technology
or offered truly magical experiences. With smartphones, geotargeting
technology, and NFC, near field communication, we are
about to embark on a new era of commerce where we bring
online and offline together. Now, changing how we pay for
things will be a big part of that new era. The way people pay for things
has not changed that much since the dawn of commerce. We went from barter to
coin, coin to paper, and paper to plastic. Now we’re on the cusp of
the next major change. Mobile payments is poised to
grow fourfold in the next four years from $170 billion in 2010
to $630 billion by 2014. I’d like to introduce Ed
McLaughlin from MasterCard to talk about the evolution of NFC
technology and payments. ED MCLAUGHLIN: Thank
you Stephanie. And as is so often the case,
the revolution in payments that we’re looking at, and the
innovations that we’ll be talking about today, have
been a long time coming. In fact, it was almost a decade
ago that MasterCard first embedded a PayPass chip
into a Nokia phone for some trials that we were doing
in Orlando and Dallas. And that became the development
of the standards and the foundation for what
we’re seeing coming to fruition today. And moving beyond what you would
see with a plastic card and enabling safe, secure,
and reliable payments. So, what we’re able to do is
prove through those trials the basis for the communication
standards. That we work together with an
industry in 2003, for this NFC foundation we’re seeing
leveraged today by Google. Now, what we’ve done since then
is continued to work on the worldwide interoperability
of all of this. So a Google enabled phone can
work anywhere in the world that PayPass is accepted and
enforce those standards that are out there. We’ve also been working closely
with merchants, so they can bring the speed, the
convenience, and security that contactless payments provide
to their customers. And the vision was always, how
do we support form factors beyond that square of plastic? How do we move beyond plastic,
whether it’s to fobs, or phones, or tapping
your card itself. And the great news is, today
over 300,000 merchant locations are ready. Over a 120,000 in the US are
ready to go for the Google Wallet for payments. Meanwhile, as we we’re working
to build out safe and secure contactless payments,
a revolution has happened in mobility. Smartphones have fundamentally
changed how consumers interact with mobile technology. Next year, over half the phones
sold are going to be smartphone enabled. And it’s that new centricity,
that new behavior, that’s profoundly changing our
customers’ experience. So if you look at it, US mobile
phone users, over half of them, have already used their
phone to shop online or research purchases. There was a recent MasterCard
survey that said over 60% of 18 to 34 year olds said they
would be perfectly at ease using a mobile phone for
in store purchases. So that’s why we’re so extremely
excited to work with Google and our other partners
to bring this vision to the market, to enable the secure,
safe, reliable PayPass contactless payments combined
with the incredibly compelling shopping experience that Google
Wallet, Google Offers, and other capabilities of the
smartphone can bring. And it’s really working together
that we’re going to be able to truly transform the
shopping experience by bringing these powerful
technologies and standards to bear. So Stephanie, can talk
more about that. STEPHANIE TILENIUS: Thanks Ed. So you can see we
have an enormous opportunity in front of us. Really an opportunity
to redefine commerce and payments. It won’t just be online commerce
or offline commerce, it’s all going to merge. So here’s how. We are joining forces with Citi,
MasterCard, First Data, and Sprint, to usher in a new
era of mobile commerce. And in the centricity of this
experience is it’s mobile, it’s local, it’s personalized,
and it’s open. We believe 2011 and beyond
will be the age of MoLo, mobile local commerce. So what does it look like? Well let me give you the
consumer example. I go to the grocery store. It welcomes me. I’ve given my phone permission
to know where I am at. And up pops my shopping list
based on what I usually buy at the grocery store, it may also
have some items that I have scanned or tapped in the since
the last time I went to the store that I know I needed. I shop and I find out, a
notification pops up, that there’s this great apple pie
that I love that I can get a dollar off of it in aisle 8. And it turns out the kalamata
olives that I wanted for my pasta sauce are out of stock,
but I can actually just tap online and have them shipped to
my house the next day from the merchant’s web site. So I continue shopping. And I check out. And when I check out, and
I pay, I tap to pay and automatically all the loyalty
rewards that I get for being part of the store’s loyalty
program are credited on my account. I pay. And I get a receipt
on my phone. That’s the consumer side. Now on the merchant side,
it goes beyond just this experience. You can imagine as a merchant
you can acquire new customers and offer discounts and rewards
in ways that has never really been possible before. So you can provide offers to
consumers, obviously with their permission, based
on location and transaction history. You can offer different levels
of incentives tied to different loyalty and
spending levels. And all of this leads to a much
stronger relationship. Now I want to stress that today
we’re announcing our first steps in making this
vision a reality. It’s important to realize we
are just getting started. This vision will take a while
to come to fruition. Our goal is to invest in
technologies and platforms to improve people’s lives
and help consumers and merchants alike. We are teaming up with Citi,
MasterCard, First Data, and Sprint to create an open mobile
commerce solution that enables consumers to find
products and places, get great offers nearby, and tap and save.
So how are we going to deliver on that vision? Well as I mentioned earlier we
had two announcements, wallet and offers. Let’s start with wallet. We are kicking off a field test
for Google Wallet today, and we will be officially
releasing the product this summer. Now with Google Wallet, your
phone becomes your wallet. You tap, pay, and save money
and time while you shop. We’re using NFC technology. In fact, by 2014 50% of
smartphones in the US will be NFC enabled. That’s 150 million devices. Now, for businesses Google
Wallet is an opportunity to strengthen the customer
relationship by offering faster, easier shopping
with relevant discounts and loyalty rewards. So let’s talk about what
Google Wallet can do. Google Wallet will support
multiple cards. From the get go, Google Wallet
we provision with your Citi MasterCard. It also supports a Google
prepaid card that can be funded from any of your
existing credit cards. And over time there will
be more cards. Now Google Wallet is also
a wallet you can lock. It’s a lot more secure than the
physical wallet you may have in your pocket
or your purse. There are multiple levels
of security. There’s the phone screen lock. There’s a required Google PIN. There’s the credit card which
is encrypted, credit card information is encrypted on a
secure element in the phone. And the credit card is never
fully displayed. Now Google Wallet works with
MasterCard’s PayPass network, accepted at more than a 120,000
merchants in the US, and 300,000 globally. And we’ve partnered with
MasterCard and First Data to roll out in the US. We are starting in San Francisco
and New York, and we’re field testing and then we
will expand nationally in the coming months. We are also working with the
top retail brands including Macy’s, Subway, Walgreen’s, Toys
“R” Us, Noah’s Bagels, and many more. Now, the other exciting thing
about Google Wallet is it makes saving simple. Because Google Wallet’s a mobile
app it can store as many deals and loyalty cards as
you like without the bulk. The first release will include
support for payments, offers, loyalty cards, and even gift
cards, all with a single tap. And that leads to my next
announcement for today. We’re announcing Google Offers,
which brings shoppers great deals, and businesses
more customers. So offers will be delivered
to your inbox as an offer of the day. You can also access offers via
your mobile apps like Google shopper and Google Wallet. And the best thing about Google
Offers is the way that it works with Google Wallet. In the future you find an offer
you want, you save it to your wallet with a click. No more clipping or printing. And to redeem offers you
have two options. You simply tap your phone at the
merchant point of sale, or you show the cashier your
offer as you check out. Now these programs will go
live in Portland, San Francisco, and New
York this summer. Now an offer of the of the
day is really just the tip of the iceberg. We have many more types of
offers that include check-in offers, for example, when you
check-in you get presented with offers. Offer ads, so when you see
an ad in search you see an offer ad. Places offers, where merchants
can include offers directly on their Google Places pages. So we intend to work across our
properties and experiences to include Google Offers
where it’s most relevant to consumers. So our objective is to bring
the pieces together into a single tap experience at
retailers like American Eagle. You pay, you redeem offers, and
you earn loyalty rewards with one tap of your phone. Now, what else do you
have in your wallet? Maybe a driver’s license, health
care card, hotel keys, boarding passes, maybe
even concert tickets. Eventually, you’ll be able
to put everything in your Google Wallet. I’d like to introduce Osama
Bedier, our VP of Payments, to show you a demo and talk
about the platform. OSAMA BEDIER: Thank
you Stephanie. What a great day it is
to be here today. And it’s nice to see so many
familiar faces, industry leaders, and partners here. Thank you for coming. My name is Osama Bedier. I’ve been innovating and
pushing the limits in payments, especially internet
payments, for the last decade. And I joined Google because I
believe we’re on the verge of a major shift in payments,
and therefore commerce. And I believe that Google is
uniquely positioned to partner with, and bring together, the
ecosystem necessary to bring about that shift as well
as accelerate it. And it’s important that this
happens in an ecosystem way, I don’t think any one
company can do it. Now we’ve announced a grand
vision and some compelling product innovations. But there are a lot of
announcements these days. This is not just an
announcement, this is a real product. It’s not just ideas. It’s up and running
and merchants are integrating as we speak. We plan to roll it
out this summer. So I’d like to show it to you. But before that, I’d like to
thank the engineers at Google as well as our partners who’ve
worked tirelessly for over a year bringing these innovations
to market. We wouldn’t be here
without them. So let’s get started. Thank you. I’m going to start with
a fresh phone. So, this is a Nexus S, we have
a secure element, or a smart chip, embedded inside it. And there’s a wallet application
that I’m about to open for the first time. There we go. The first thing you see is a
tour, but you guys are going to get your special tour,
so we’ll skip that. And then I agree to the
terms and conditions. You know how that goes. And the first thing it asks for
is to attach my wallet to a Google account. This is important because it’s a
layer of security as well as how we sync offers from all of
our properties to your wallet. Then it asks me for a PIN. I enter a PIN. This is the first thing
I need to do. Without it I can’t use it to
pay or access any of the information in the wallet. As soon as I do that I get
presented with the option of adding a credit card. As you can see, you can
add a Citi MasterCard. If I click on that I simply
a get form with a few fields to fill out. As soon as I fill out these
fields I can provision a card. But I’m going to show it to you
not on a fresh phone but my actual phone with my card. I actually don’t like leather
wallets, so this is how I hold my cards. I hope someday I can put all
of this in the wallet. This is my credit card. I have obviously blocked out
the numbers, but this is my actual credit card. And I’ve pre-entered the
information for my credit card into my phone. I’m sorry I can’t show you the
screen with the information filled out. I’m a security freak and this
video is probably going to get to a few places. I entered the information and
I’m going to click continue here and it’s starting to
provision the card. Let me tell you a little bit
about what’s happening here. That screen isn’t dark enough. Let me tell you a little bit
about what’s happening while it’s provisioning. So, the information I entered is
sent to my bank, where the bank verifies that information
alongside the information that they have stored for me
in their records. As soon as they verify that
that’s me, as well as the fact that I should be able to
provision that card to the mobile wallet, they send it to a
trusted services manager, in this case First Data. And the trusted services manager
is uniquely qualified through secure keys to
communicate with the secure element on that phone. So they are the only ones
that can actually place a card there. As soon as that process is
complete, within seconds we’ve provisioned an actual credit
card onto a phone over the air in seconds. This is important because it is
a world first, and it will change the way credit cards
are issued in the future. So now we’re going to go
back to my credit card. And as you can see, my card’s
been provisioned to the phone. I actually can only use up
to $100 until I enter a activation code that I get
through my email or SMS. I won’t do that now. I can start using
it immediately. And that wallet it is now
available in the wallet– that card is now available
in the wallet. So, below it there’s a little
green icon there. I could choose to activate or
deactivate the cards in the wallet, which brings us
to the next card, the Google prepaid card. The Google prepaid card comes
with every wallet. You can provision it with a
single tap and it allows any user with a Google Wallet to be
able to tap and pay at any of the 300,000 PayPass
locations locally. I can click on that card, and
I get a menu where I can add funds from any credit card. So I enter any credit card here
and I can add funds to that Google card. And so there’s definitely
two credit cards in the wallet at lunch. I can also add other cards. This is an open platform
as Stephanie mentioned. The idea here is to continue
to partner and add cards to the wallet. Hopefully putting all of
my cards in there. It also brings us to this
multiple payment cards inside a wallet. Up until now the contactless
smart chips have only had one card in a wallet. We’ve enabled multiple cards in
a single secure element to be provisioned over the air. This is a pretty big
accomplishment, and it gives us the ability to offer consumer
choice, a very important component
of our wallet. We want to allow the consumer
to use all of the funding methods or all the payment
instruments that they’d like in that wallet. And this wallet can also
be used without having to be opened. As a consumer I can set my
preferences, as well as which cards to be active or inactive,
and they’ll work whether the wallet application
is open or not. Which brings us to
the next point. I can lock the wallet
of course. Security is very important
to us. It was a fundamental
consideration from day one. And so I’m going to ask Rob von
Barron one of the first engineers on the wallet product,
without him we wouldn’t be here today. He’s going to come up and
talk about security. He spent a considerable amount
of the last year building it. C’mon up Rob. ROB VON BARRON: Hi everybody,
I’m Rob von Barron. As Osama mentioned, I was one
of the founding engineers on the Google Wallet project. I want to talk a little bit
about some of the secret sauce that we’ve added to the
wallet to make sure that it’s really secure. So, clearly, from the beginning
of the project, security was something that
we wanted to make sure was absolutely airtight. We took the industry standard,
best practices with PayPass and smart card based payments. We wanted to make sure we could
add extra on top of that to really protect consumers and
protect their credit card information. So, there are a couple
of things that are really key to this. One, as you can see up here on
this slide, is this smart card chip, the secure element chip
from NXP that’s in the Nexus S. So this chip is the same kind
of smart card chip that’s used for electronic passports,
for contactless and contact based smart card credit cards,
and it’s got a lot of protections built into it. It’s got tamper sensors so
if you crack it open it will self destruct. It’s got protection against
laser attack, so if Doctor Evil comes and tries to have a
shark with lasers come and steal your credit card,
he can’t get to it. So, this chip has a lot of
security baked into it. And this is where we’re storing
the credit card information to make sure
that nobody can get it, nobody can copy it. So there’s two pieces that
are important about how this chip gets used. One, as Osama had mentioned,
is this over the air provisioning process. In addition to just the credit
card information that a user types in, when you’re doing
OTA provisioning, the bank sends some special secret sauce
that identifies this account in a way that is known
only to the bank and to the secure element. It’s provisioned securely all
the way through, and stored in this one chip, on
the phone, not accessible to anywhere else. The second part of it
is, how is this used to make a payment? That’s the other part of
communicating this account information. When you go and you have your
phone, you’ve got your Nexus S phone here, walking around
in the subway. If I happen to have this in my
pocket and the screen is turned off, the NFC antenna
is turned off. Nobody can go and skim any
information, they can’t see identifying information
about me. When the screen is on NFC is
enabled, but the secure element chip itself
is turned off. The secure element is only
turned on when I actually unlock the wallet and enable
that for payment. So, in addition to having the
best possible secure chip so that we’re not going to be able
to copy the credit cards, it’s stored inside a wallet
that you can lock. So with that I’ll turn it
back over to Osama. See the rest of the demo. OSAMA BEDIER: Thanks
a lot Rob. So we’ve talked about
security. We’ve talked about setting
up your wallet. I added my credit card. Let’s go shopping. So on my way here my daughter
said, please buy me some denim shorts. I said OK, I will do that. I don’t want to make her mad. I’m going to go online and
search for some denim shorts. I’m going to type in denim
shorts here, with a bit of commentary. Actually I’ll leave it at denim
shorts so she’s happy. Look at that, 20% off
anything in the store at American Eagle. What a great offer. So I’m going to unlock
my phone here. Open up the wallet app
so you can see this, this is important. And I’m going to go to the
offers section of my wallet. And I’m going to click on that
coupon, which has saved to wallet, a new feature
we’re adding. As soon as I do that, back to
the phone, as you can see the offer showed up. So, I’m ready to go save 20%
off at American Eagle. But as you can see, I’m a
big guy, I get hungry. I’m going to the mall
so I’m going to go look for offers nearby. Subway, I like Subway. $3 flatbread breakfast.
Well, I like breakfast anytime of the day. So I’m going to save that
to my wallet as well. I’m going to go back to the
saved offers in my wallet. And here’s my Subway coupon. So, a lot of great stuff
in the wallet. Actually one more thing
I want to show you. I mentioned we can hold all
kinds of cards, we also have loyalty cards. And so I’ve also added my
American Eagle rewards card into the wallet. With all these great goodies in
there, by the way I can put other cards in the wallet, with
all these goodies though, let’s go to American Eagle. And we’ve invited Beth McCormick
from American Eagle to be here with us and help
me with this demo. Hey Beth, how’s it going? BETH MCCORMICK: Hi. Good, good thank you. OSAMA BEDIER: Thank you
so much for coming. BETH MCCORMICK: We are
thrilled to be here. OSAMA BEDIER: It looks like
you brought some equipment with you there. BETH MCCORMICK: We did. This is a real point of sales
system, just like we would have in our stores. OSAMA BEDIER: We wanted
this to be as close to real as possible. This was not easy. I got to tell you, it was so
hard to bring a full point of sales system. There’s actually a bunch of
equipment over there that it connects to, but we wanted to
give you the real experience. So, my daughter wants
some shorts. BETH MCCORMICK: Well we have
shorts, we have denim shorts. The best in the mall. Here you go. OSAMA BEDIER: OK. BETH MCCORMICK: She’ll
love them. Trust me. OSAMA BEDIER: I’ll take
your word for it. BETH MCCORMICK: They’re
perfect. OSAMA BEDIER: Great. Let’s buy it. I’m going to go over here and
take the wallet with all the goodies that I added earlier. And then tap here,
at the terminal. What you’ll see is it passed all
three instruments over to the terminal. My credit card, the coupon– just wait for it show up there–
the credit card, the coupon, and my rewards card. BETH MCCORMICK: I just need
you to tap again please. OSAMA BEDIER: OK,
let me try that. BETH MCCORMICK: OK, perfect. OSAMA BEDIER: As you can see
it passed all three again. BETH MCCORMICK: OK, at the point
out of sale you see the AE rewards number is at the top
of the screen and we have the offer that is pending. And I will complete
the transaction. You see the offer is calculated,
it’s authorizing. And I just need you to finish
the transaction and we’re good to go. OSAMA BEDIER: Great. So I’m going to go to the
terminal here and just finish the transaction. There we go. I won’t show you my signature. BETH MCCORMICK: Thanks
so much. OSAMA BEDIER: And that’s
how simple it was. Now we call that single tap. And I’m going to invite another
key engineer, one of the founding engineers on the
Google Wallet project, Jonathan Wall, to come and talk
a little bit more about how we did it. JONATHAN WALL: Hello, I’m
Jonathan Wall, the other founding engineer of the
Google Wallet project. And I’d like to talk to you guys
a little bit about single tap technology today. We think this is one of the more
powerful innovations that we’ve built into the wallet. So I’d like to get into the
nuts and bolts of how this works and describe how we think
this is really going to power this open commerce
ecosystem in the future. So the way this works is that
when you tap your phone to the merchant’s point of sale system,
it opens multiple secure channels to
the merchant’s point of sale system. And what this lets us do is
send in one single tap transaction, multiple objects
to the point of sale system. So, in the demo you just saw,
we sent an offer, a loyalty card, and a payment card. And this all happened
quickly and easily. So at launch we’re going
to be using the usual suspects of commerce. We’re going to launch
with gift cards. We’re going to launch
with loyalty cards. We’re going to launch
with offers. And of course, payment cards. But we think as for a lot of the
wallet features, this is just the beginning. This single tap technology is
something we’re going to keep investing in and we’re going to
keep innovating on top of. And we think that this will
give us the ability to add really deep, differentiated
experiences between consumers and merchants. So coming this fall we’re going
to be introducing some cool features. The ability to pass digital
receipts back from the point of sale into your wallet, so
that you don’t have to have wasteful paper you throw
away anyway. And also the ability to
dynamically create cards. So if I tap a merchant, say
Peet’s for example, every morning I’m getting my coffee. After a while Pete’s could
suggest to me, hey John you’re buying coffee here an awful lot,
why don’t you sign up for our loyalty program to get
your tenth coffee free. So these are really obvious
things for us to do next. But, I think that it’s kind
of wide open where we’ll go with this. We’ll definitely consider having
game dynamics added to loyalty instruments. So there might be games in the
wallet and pieces to a puzzle or a board that you get
back in your wallet when you tap and pay. And really the sky’s the limit
with this technology. So with that I’d like to hand it
back to Osama and just say we hope to bring a
better experience all in a single tap. OSAMA BEDIER: Great, hey
thanks Jonathan. OK, I’m going to
take my phone. And got my shorts
for my daughter, she’s going to be happy. And I’m walking out of the
mall, and I see a poster. Macy’s, my wife loves Macy’s. And it’s got an area where
I can tap for a coupon. So, I’m going to tap here
with my wallet. And this coupon shows
up in my wallet. I’m going to say save. And now
it’s available in my wallet. So we’ve shared how a digital
wallet can make shopping experiences much more
compelling. And we’ve shown you a real live
working product here that merchants are integrating
today. But this is just
the beginning. We plan to continue to
push the limit and innovate in this space. And we’d like to show
you a short video what that could like. [VIDEO PLAYBACK] [MUSIC PLAYING] OSAMA BEDIER: So, now that
you’ve seen our vision, our product, our partners. We would like to extend an
invitation to all of you. This can get a lot better. As I mentioned this is
just the beginning. We want to invite banks,
carriers, merchants, POS systems providers, to help
bring about these richer experiences. Help us usher in the next era
of open solutions that add value for all players. We’re building an open
commerce ecosystem. And Google Wallet is built on
top of that open platform. By the way, open is who
we are at Google. It’s a deep part of our
culture, a part of our history, and we know that
open solutions add value for all players. Open systems drive competition,
innovation, deliver consumer choice,
and most importantly, exponential growth. We focus on the user and
all else will follow. That’s what you hear us say
all the time at Google. And you see it in
our products. Android already has 100 million
phones in market. And we’re activating over
400,000 phones a day. You see it in maps. You see it in Google
app engine. And we’re very excited to bring
it in a wallet context. So what does an open
wallet look like? Well, we’re starting with wallet
objects, cards that you put in the wallet. Of course you see the first
important instruments in the wallet today. It’s the backbone of commerce,
it’s the things that make commerce happen. And we’ve worked with the
major players in these industries to bring
it out together. But we plan to aggressively
enable everything a consumer would want to put
in their wallet. And allow any instrument or
object into that wallet as long as it plays by the
rules and allows for a healthy ecosystem. We don’t charge for access
to this wallet. The wallet is free
to partners. And our goal is to level the
playing field so no one has an unfair advantage and even small
businesses like your local cafe, your florist, or
your bookstore, can put offers and loyalty programs directly
into that wallet. We plan to create APIs so
networks, banks, retailers can participate. And work with partners to
promote open standards that benefit consumers
and merchants. Security, as you’ve seen and
heard, is a fundamental principle design
consideration. It will color how we develop
and open up that platform. We want it to be as open as
possible, as long as we don’t sacrifice on consumer
choice or security. And we’re here with our
launch partners. And I’d like to extend a warm
greeting to those colleagues from Citi, MasterCard, First
Data and Sprint. And they’re going to join me
here on stage one by one to share a bit of what they
think about this. We’re going to start with
Paul Galant from Citi. Thank you Paul. PAUL GALANT: Thanks Osama. Thank you, thank you. Osama, I’m pretty sure you
didn’t need to introduce me as the banking partner given my
banking costume stands out here in Google’s New
York office. But having said that, today
marks an important milestone in digital and mobile banking. Citi is proud to be the lead
bank at the launch of Google Wallet, playing a key role in
bringing valuable services to today’s busy, on the
go consumers. We’re proud to be at the
forefront of this key milestone by being the first
bank to lead the wide commercialization of NFC
payments in the United States. And it is indeed a privilege
for us to be here today on stage with the great
collaborators that we have from Google, from MasterCard,
from First Data, and Sprint. I want to stress and leave you
with three key messages that are really important. First is the strategic
importance to Citi, and in fact the entire banking
industry, of digital money and mobile payments. Citi has a long and successful
history of innovation and partnership with great firms
around the world. Today’s Google Wallet
announcement supports Citi’s position as a global leader in
payments and brings to life our CEO Vikram Pandit’s vision
for Citi to be the world’s digital bank. Most important of all, our
collaboration and role in the Google Wallet is another
illustration of how Citi is working to enhance our
customers’ experience through innovation, through security,
value, and convenience. All supporting our deep
commitment as a bank to responsible finance. In just the last year Citi
has launched a number of innovative consumer banking
solutions around the world including an integrated cards
and bank application for Android and other smartphone
devices, Citi text banking, and Citi social media customer
service via our official Twitter handle @AskCiti. In addition, a first of its
kind US flagship Citibank branch was opened just this
last December in New York city’s Union Square area, just
a few blocks away from here. It features the most
unbelievable interface for consumers that you’ll
find in the world. Smart banking technology such
as interactive service and media walls, enhanced image
ATMs, free online and wireless access for customers,
and so much more. If you want to see the future
of branch banking come visit the Citibank branch
in Union Square. I think you’ll enjoy it. The second very important point
that I want to make is about the increasing convergence
of banking, technology, and information in
creating customer value and new business models globally. With today’s announcement,
Google Wallet provides Citi customers with an important
new dynamic channel for evolving mobile banking
offerings. And we’re committed to
leveraging this state of the art technology to deliver
powerful tools in a tangibly better and rewarding customer experience for Citi’s consumers. Google Wallet represents true
innovation and a technical collaboration between Citi and
the partners that have come here today. Folks, our engineers have worked
tirelessly, and I mean tirelessly, round the clock
and seamlessly with Google engineers to connect Citi’s
core industrial strength banking capabilities and engines
to Google Wallet’s so our customers will have a
greater convenience and control with respect
to managing their day to day payments. We wouldn’t be here today
without their steadfast dedication to excellence
demonstrated by the development teams. I think
Citi’s remarkable engineering work enables the
commercialization of an intuitive customer payment
solution that allows our consumers to make payments as
easily as our customers make phone calls or send text
messages on their smartphones, and that’s real innovation. Today we’re announcing Citi’s
collaboration with Google Wallet for one simple, but very
vital purpose, to help improve and simplify the
everyday lives of consumers by bringing them real value,
enhancing their shopping experience, and helping them
better manage their money. Our customers are busy. They’re often using their
smartphones for everything from finding a great place to
eat, to searching out the next great kid’s toy. Well starting today, they
can use that same device to pay for it. And I think that’s progress. My final point is on the
significance of today’s announcement. It’s widely accepted, and in
fact I think my partners have spent some time talking about
it, that we’re really just at the starting point of mobile
payments capabilities. And in time, there will be
numerous systems made available to the billions
of cell phone users around the globe. But there can be no doubt that
today’s announcement will be looked at as the inflection
point of how mobile payments have evolved from a concept
to mass consumer adoption. Today it starts. We’re already engaging with Citi
consumer, corporate, and government clients around the
world in both developing and emerging markets about mobile
payments and helping them to use this great new technology. We see this is as a starting
point for all the new ways that we will grow and
evolve together. And I want to thank all of you
for coming here today. And with that I’d like to turn
it over to my partner Ed McLaughlin from MasterCard. ED MCLAUGHLIN: Thank you. And to pick up a theme from
Paul, it seems that whenever anything truly innovative comes
to the market there’s always lots of speculation
around things like disintermediation. But that’s really not what
we’re talking about here today at all. It’s about intermediation. It’s about bringing together
industry leaders to leverage their mutual strengths to create
absolutely compelling capabilities for card holders
and customers. And we see MasterCard at
the heart of commerce. With our network bringing
together hundreds of millions of consumers, and
tens of millions of merchants worldwide. And at the heart of MasterCard
is our network. Where we’re bringing to this
partnership the fastest, most intelligent payments network
on the planet. If you’ve used MasterCard you
know we’re processing billions of transactions literally
in the blink of an eye. And every MasterCard user
understands the reliability that we present. But more than just the speed and
reliability, we think it’s the intelligence the network
that truly sets us apart. If you look at things like
our MasterCard in control technology which provides real
time communication globally between the card holder and the
payments network itself so it can able things like alerts,
coupon redemption, true personalization
of that account for the individual consumer. So we see the wallet as an
incredible example of combining the intelligence
that you can have on a smartphone, the speed, and
reliability, intelligence that’s in the MasterCard
network. We’re also leading the way in
the design, the standards, and the certification of PayPass and
the equipment that brings the mobile ecosystem to life. As I said earlier, PayPass
brings the power and intelligence to the network to
consumers, at thousands of merchants today, all ready to
go for the Google Wallet. And what we’ve absolutely seen
since this first PayPass trials in 2002 that I talked
about, is once consumers experience the speed and
convenience of tapping, they never go back. It is a fundamentally better
experience, and one that we’re looking to enable. So today as we said there’s over
100,000 merchants ready to go for the Google Wallet. And I’d like to bring Ed Labry
up from First Data to talk about what we’re doing together
to help expand that merchant footprint. Thank you. ED LABRY: Wow. What an incredible day in the
history, and also the future, of payments. I am Ed Labry, I’m
the president of First Data North America. And I have been in the
industry and at First Data for 27 years. This really on behalf of all
25,000 employees of First Data worldwide, I’m really excited
of what we have going today. I don’t think anybody that
follows payments ever thought that this day would not
happen. it was never a question of if, it was when and
who was going to bring it. I know I speak for all the
companies, all the product teams that are listed right
behind me in saying we’re really proud to be here
all together. Payments is a herd mentality. I think that when Diners Card
was a slide earlier, it made me think 1950, just about
everybody in this room was not born. But I think there’s some things
that are very relevant to the payments industry that
we can all think about. Think about 1989, you could not
use your credit card in a supermarket in the
United States. Now over one half the payments
in supermarkets are electronic. In 1993, you could not use
electronic payments to pay at the pump. Those of us that buy gas, you
will not stop and buy gas if they don’t have pay
at the pump. And in 1999, the thought of
putting electronic payments in quick service restaurants was
a little bit ridiculous. And now every quick service
restaurant chain has electronic payments. All right, I want to introduce
you to First Data’s ecosystem. So, very simply, First Data
has about four million merchant locations in the United
States where we process electronic payments. And also, we have relationships
with 7,000 financial institutions to
provide their card processing and [? around ?] network
services. Now, nobody’s ever heard of
First Data unless you’re in the payments industry. But we process 40 billion
transactions a year. So whether it’s your airline
tickets, your hotels, your rental cars, your restaurants,
your coffee you buy, more than likely on the day to day basis, you’re using First Data. And we think our strengths
are this. We bring definitely the
commitment to innovation to the payments industry as
illustrated by our TSM m technology today. We bring relationships. We’ve been in the business
over 40 years and have relationships with the most
name brand recognized retailers and financial
institutions, such as Citi, in the industry today. We bring product. So you think about 80% of the
stand beside point of sale systems in the United States are
provided by First Data and now will be NFC enabled. We bring processing, so all
the numbers I mentioned a minute ago represent over
50% of all the financial transactions in the
United States are processed by First Data. And also, we have over a billion
prepaid cards on file with the largest name brand
retailers in the United States today. So I’ll try to simplify
this a little bit. I agree with Stephanie. We have a vision that
everything, if we dumped out everybody’s purse and did out
everybody’s wallet, everything would migrate into the Google
Wallet one day. But it’s simply this. We house 700 million
cards, card numbers on First Data system. Today they are on pieces of
plastic, mostly in your wallets and purses. It is simply this, we take those
700 million card numbers and provision them over to the
TSM which will enable the phone to be used at our
four million merchant locations and beyond. So it hit me a little while ago
when we were talking about this is a pilot and
what we’re doing. And there’s a lot of companies
out there in the marketplace that have talked about the
vision, or the collaboration, or we’ll be doing this one day,
or these are our thought processes and our commitment
to mobile commerce. I got to thank all the companies
for coming together, especially the product
and engineer groups. You’re going to make us very,
very proud today. But this is not something
that is vapor. That phone Osama just
provisioned, when we go to the cafeteria it can buy Coke. It can be used across the street
at the two merchants that are there. Over the last three weeks First
Data sales force has enabled 1,000 merchants in the
city where this phone, and phones excuse me, can be used. So thank you very much and
we look forward to this program growing. And it is my pleasure to
introduce, I’ll get it, hang on a second. Fared Adib, the chief technology
officer at Sprint. Thank you. FARED ADIB: Thank you. I give him a lot of credit,
it is a hard name to say. This We’ll hopefully
have Google develop an app for that. Thank you for having us. We’re really delighted to
be here from Sprint. And being one of the founding
carrier partners in this open alliance that you
see here today. We have a long history at Sprint
of working together with our partners at Google, and
we’re really happy about the partnership. In fact to give you some of the
history, we were one of the founding charter members of
the open handset alliance for Android. As well as we launched
the first 4G Android device in America. And more recently, we just
recently launched this device that you’re seeing all the
demos, the Nexus S 4G. It’s a pure Android
experience. And we also recently integrated
Google voice for our customers so that our
customers can use their Sprint numbers as their Google
voice number. So for us the open philosophy
is a way of living, it’s really not a choice. In fact, a lot of open, really
to stress what Stephanie and Osama have been saying, is
really about democracy. It’s something that we all
as Americans very much understand. and What it really does is
it allows for choice. We really at Sprint believe
that a carrier should not dictate your experience
on your phone. That choice, that experience
should be provided to you from the names and the brands you
trust, like Citi, and MasterCard, and First Data. And so for us, we believe that
a carrier should really help enable that, and
not dictate it. So, one of the things that we
are really excited about the Google Wallet is being able to
be one of the first carriers to provide this source
of choice for our 51 million customers. And part of the way we’re going
to do that is we’re going to continually integrate
this technology that you saw today and work with our OEM
partners like Samsung, HTC, as well as Motorola’s of the world,
and others to try to make sure that we become a good
bridge on making sure this technology works
on those devices. Now it’ll take some time for it
to proliferate through our entire portfolio. But on day one we had the Nexus
S 4G which is one of our top selling phones
today at Sprint. People are just absolutely
happy with this product. And part of it is that it allows
them to have this type of open experience. In fact Android is our fastest
selling platform in our product portfolio. Over 75% of the sales that we
have today come from the Android market space. And we’re very heavily invested
in this space because, again, it aligns very
well with our strategic initiatives and I believe with
most of the strategic niches of most of the companies and
merchants out there. So, again I just want to keep
this short and close by saying we’re very excited about this
opportunity and we really want to thank the Google team. They’ve just been so delightful
to work with. If any other company really
wants a testimonial on that please come talk to us,
because the amount of collaboration and easy to work
with attitude that all these companies have had has
just been phenomenal. And that’s really part
of it as well. You have to be able to work
together in an ecosystem and be able to collaborate for
it to be successful. And we look forward to be
standing here in a year from now and really looking at the
successes of this endeavor. So thank you very much. STEPHANIE TILENIUS: Well, wow,
lots of exciting news. I want to thank our partners. And I want to thank all the
merchants in the room. A lot has happened over
the last year. And special thanks to all the
engineers, product managers, sales folks, marketing folks,
sales integration team, I mean this has been an
incredible run. And we’re just getting
started. And in addition to all the
partners that we’ve talked about today, we are here with
some of the best retail brands in the country. We’ve pulled together a short
video to show you who’s working with Google Wallet and
give you their perspective. [VIDEO PLAYBACK] -What the consumer’s looking
for today is fun shopping experience, but she also wants
it simple and easy. And I think we accomplished
both with Google Wallet. -In the US alone we have over 30
million customers that come through our restaurants
each week. The ability to use a technology
like Google Wallet to help improve the customer
experience for those 30 million people that come
into our restaurants is critically important. -We’re a fun store to shop in. We want our customers to
enjoy the environment. That’s what I think Google
Wallet can bring to American Eagle as well. -I think it is game
changing from an experience point of view. When you think about a customer
walking into a store they now have information at
their fingertips, value at their fingertips, things that
didn’t exist before. To me Google Wallet organizes
someone’s personal data in a way that’s much more secure and
it actually gives them the ability to take less things
with them when they leave the house. Google wallet will improve
the shopping experience. It’ll make the transaction
faster and easier. It’ll do it in one touch on
the tap of her phone. It’s amazing. It’s amazing for the customer. It’s going to change how people
shop, how they want to pay, how they think about
going to the stores. And it’s going to happen fast. No one says, oh good I get
to go check out now. Anything we can do to make
that process faster, and simpler, and easier for the
customer is going to help them and help us in the long run. Value is no longer lowest price,
it’s what people value individually. And this obviously allows us to
talk to a consumer in a one to one relationship on the
things that they value most. They could be walking down the
street thinking about lunch, type lunch into their
smartphone, and instantly receive an offer from Subway. Once they’re in the restaurant,
they go through the ordering process as they
typically would, but at check out they basically are
able to tap to pay. Moves them through more quickly
and gives them a better customer experience
overall. So Google wallet really allows
us to create that one to one relationship in a meaningful
way with the consumer on things that matter
most to her. The idea behind Google wallet
is that if now we’ve offered her a much easier way to
transact with us, it will keep her in the store longer,
and hopefully, have her shopping more. We do see incremental sales
coming from our participation with Google wallet. We think it’s going to be a home
run with customers and very important to the Subway
business moving forward. Yes we’re going to
launch something that’s going to be great. It’s going to be cool. It’s going to be exciting. It’s going to be very usable. It’s going to be customer
friendly. But what’s the next step? What’s around the corner? And that’s what excites
me the most. [END VIDEO PLAYBACK] STEPHANIE TILENIUS: I am
thrilled that all our friends at Macy’s, American Eagle,
Container Store, Walgreen’s, and Subway are excited
about Google wallet. And many other merchants
that have signed on. We want to invite merchants
everywhere to come on board. So let’s recap where we are. Google wallet and Google Offers
will help create a great shopping experience for
consumers, blending online and offline and bringing great
convenience and savings. They will help merchants build
stronger relationships. And Google wallet is built on
an open platform, so any partner can participate. And as the ecosystem comes
together, we hope to take advantage of all the great
technology that’s available to us to transform shopping. So today we’re field testing
Google wallet, and we expect to release this summer. And as Fred mentioned in the
video, we are really excited about what’s around
the corner. And with that I want to thank
everyone for coming today.

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