Feeds

Schmidt sees NFC terminals everywhere

But Google won't be paying for them

High performance access to file storage

Eric Schmidt reckons a third of shops will be NFC enabled in 2012, but Google won't pay for the terminals – that's up to the credit card companies.

According to Google's executive chairman, credit card companies will pay for the new terminals, with the critical mass of one in three to hit sometime next year and enabling Google to tap into a "trillion dollar" business though Google Wallet as we all start paying by tap.

Schmidt was speaking to reporters, including the Financial Times blogger Tim Bradshaw, at the Cannes Lions advertising festival, and explained that credit card companies are keen to enable contactless payments "because the fraud rates are so much lower", which is a hitherto unexploited spin on the technology.

Pay-by-tap is normally associated with increasing usage rather than decreasing fraud: compared to the chip-and-PIN system commonly used in Europe, paying by tap is obviously much less secure. But in America credit cards don't routinely have chips in, which makes them vulnerable to skimming (copying), and NFC makes that much more difficult.

Payment systems using NFC, in common with chip-and-PIN, have cryptographic keys embedded in the card to authenticate transactions. As the keys are never transmitted it is effectively impossible (or, more accurately, unprofitable) to make an exact copy of a pay-by-tap card, which should reduce fraud in the USA.

In Europe, the driver is increasing the use of credit cards. The credit card companies will ask for a smaller cut of NFC transactions, and the fact that transactions are capped at £15 will encourage people to use NFC for low-value transactions. The merchants don't like handling cash anyway (its expensive to transport, store and you have to employ trustworthy cashiers too) so are happy with the switch but that's a matter of convenience rather than measurable financial gain.

If Schmidt is right – and he claims to be have been discussing the migration with key industry players – then the increased protection from fraud could motivate card companies to drive the USA into the lead in NFC adoption. ®

High performance access to file storage

More from The Register

next story
A black box for your SUITCASE: Now your lost luggage can phone home – quite literally
Breakfast in London, lunch in NYC, and your clothes in Peru
Broadband Secretary of SHEEP sensationally quits Cabinet
Maria Miller finally resigns over expenses row
Skype pimps pro-level broadcast service
Playing Cat and Mouse with the media
Beat it, freetards! Dyn to shut down no-cost dynamic DNS next month
... but don't worry, charter members, you're still in 'for life'
Like Google, Comcast might roll its own mobile voice network
Says anything's possible if regulators approve merger with Time Warner
EE dismisses DATA-BURNING glitch with Orange Mail app
Bug quietly slurps PAYG credit - yet EE denies it exists
Turnbull leaves Australia's broadband blackspots in the dark
New Statement of Expectations to NBN Co offers get-out clauses for blackspot builds
Facebook claims 100 MEEELLION active users in India
Who needs China when you've got the next billion in your sights?
prev story

Whitepapers

Mainstay ROI - Does application security pay?
In this whitepaper learn how you and your enterprise might benefit from better software security.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
3 Big data security analytics techniques
Applying these Big Data security analytics techniques can help you make your business safer by detecting attacks early, before significant damage is done.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Mobile application security study
Download this report to see the alarming realities regarding the sheer number of applications vulnerable to attack, as well as the most common and easily addressable vulnerability errors.