The mobile payments industry doesn't have clear leadership right now. There are a slew of companies trying to tap the space, including eBay's PayPal and start-ups like Square, but no contender has emerged as the dominant player.
Of the five tech giants currently at war, Apple (AAPL -2.19%) and Google (GOOGL -1.82%) have the most immediate structural advantages since mobile payments will inevitably be driven by smartphones, and iOS and Android power over 90% of all smartphones sold. Amazon.com has 209 million active customer accounts with payment info on file, but the e-tailer doesn't operate a smartphone platform (yet).
Google is a first-mover in mobile payments with Google Wallet, but it has failed to move the needle even after launching two years ago. Meanwhile, Apple hasn't made any official forays, instead only offering Passbook that doesn't have a direct way to make payments. The Mac maker is widely expected to enter in a big way as early as this fall, since the iPhone 5S will likely include a fingerprint sensor for biometric security. Those 575 million active iTunes accounts are just waiting to be tapped.
Mobile payments are too important to ignore, and Google is making a renewed push with Wallet ahead of Apple's presumed entry. The search giant has launched a fresh promotion to encourage developers to integrate Google Wallet into their apps. At Google I/O in May, the company had also unveiled a new application programming interface, or API, for developers to integrate Google Wallet into their Android apps. Google said only 3% of shoppers on mobile devices complete checkouts because there are so many steps.
Big G is broadening its horizons beyond just in-app purchases of virtual goods; Google is facilitating the payments for third-party merchants selling physical goods and services.
Apple's key differentiator may be the expected integrated fingerprint sensor, which is something that Google can't uniformly support since that's a hardware element -- a decision that falls into OEM jurisdiction. For now, Google has a first-mover advantage over Apple, which it should aggressively exploit before the iPhone maker shakes things up.
