Android Pay has finally arrived

Google announced on Thursday that is redoubling its efforts to make a working mobile payments system with the introduction of Android Pay, which will let people use a "single tap" to pay for things either in apps or at brick-and-mortar stores.

The new service will also...

integrate rewards programs for repeat customers.

The existing Google Wallet service will pivot into a way to transfer money between people in a similar fashion to Venmo or Square. The announcements came during the company's major mobile event, I/O, which tells developers what to expect.

Google had been among the first companies to try to make mobile payments a mass-market service with its Google Wallet, which came out in 2011. However, the market was so nascent that the service had trouble attracting many partners. It also had to deal with an early security flaw. Much of that development is being wrapped into Android Pay.

Now, 

G

Google is playing catch up to Apple Pay, which debuted in September 2014 during Apple's keynote event. CEO Tim Cook claimed strong initial use of the service, with its partner Whole Foods Market seeing a 400% increase in mobile payment use.

One of the biggest differences between this effort and its initial payments product are the deals that Google has struck. American Express, Visa, Mastercard, and Discovery are on board with Android Pay, according to a slide shown during Google's presentation.

The system also works in more than 700,000 stores in the U.S. that accept "contactless payments" as well as in apps for a variety of companies.

Apple Pay in action. For Google, this is the enemy.There did not appear to be any major differences from Apple Pay.

There was a lack of details during the presentation around a variety of important topics, which surprised some.

Mobile payments are considered one of the next big growth areas for mobile software. While paying with smartphones can still seem gimmicky, numerous projections show the market growing rapidly. Forrester Research estimates that total mobile payments — remote payment, in-person transactions and personal transfers — will hit almost $142 billion by 2019.

IMAGE: FORRESTER RESEARCH

Google also recently acquired some new technology to bolster its payments system, buying up technology from startup Softcard in February. The deal also allows Google to preload Google Wallet on handsets sold by Verizon, T-Mobile and AT&T.

That's a nice little score for Google, who will need to find all the advantages it can in the crowded payments market. In addition to Apple, there's upstarts like Square and Venmo (now owned by PayPal). Even Samsung recently jumped into the fray with "its own payments system.

Mobile payments are starting to get crowded.

IMAGE: RICHARD LEVINE/DEMOTIX/CORBIS

 Pay.

One analyst estimates that Apple takes in about $.15 for every $100spent on Apple Pay.

Beyond the money is the hope that people who grow even more attached to their smartphones, thanks to its payments systems, won't be as tempted to switch to other competitors. Payment systems also generate a large amount of data that is extremely valuable to advertisers, who paid Google $59 billion last year for targeted advertising.

IMAGE: IDC

Google's fresh effort in mobile payments now means that the two biggest names in smartphone software will be pushing hard to be the leader in the market. The addition of payments to Android brings the technology to 78% of the worldwide smartphone market. Combined with Apple's iOS, that puts a high-profile payment system on 96% of all smartphones.

Source:http://mashable.com/2015/05/28/android-pay-google-io/?utm_cid=hp-hh-sec