(2 minutes reading time)
Since having spend some early years of my professional life in a technical wholesale company I have been following the incredible developments of Amazon with great interest, albeit from a large distance. The last couple of years I have spend much of my billable time on payments related projects. When a headline holds both “Amazon” and “payments” I can not resist reading it!
Amazons’ interest in payments is nothing new. What I find interesting about the Finextra report though is the convergence of various payments related concepts which are referred to and dealt with “in isolation” by others. Let’s summarize referring to the competitors in sight of Amazon (links to earlier coverage on RPD):
First at the merchants side:
- In store payments checkout like Gopago (Amazon acquisition): many others
- Card reader: Square
- Terminals: Use of Kindle tablet in competition with most notability Apple’s IPad and more traditional players.
Secondly at the payers side:
- Converging multiple 3rd party credit cards to one Amazon card: Coin
- Amazon (branded) Credit Card: the usual suspects MasterCard, Visa etc. (NB how to combine with #3?)
- P2P: PayPal
Not (implicitly) mentioned in the Finextra report:
- Amazon Wallet: Apple Wallet, Google Wallet, MyOrder…
- Amazon coins for P2P? I hope not. I speculate that the P2P function will be based on Amazon Coins, as this is formally no money or currency it will be easier to introduce due to regulations about money services in various countries.
- Payment Service Provider: many others, reusing Amazon accounts
- Amazon Prime: Apples’ ITunes accounts, (i.e. closed ecosystem accounts)
Will Amazon be able to reverse the payments chain as I expect the Apple Wallet to do? I do not think so for it does not have the smartphone base that needs to act as a terminal. The much anticipated Amazon smartphone will have to sell massively to make a difference soon.
What I have not figured out yet is how Bozos plans to attract a sufficient amount of brick and mortar retailers for its payments services. Amazons traditional core business is in direct competition with them (at least in the US). The Amazon checkout will allow Amazon to see what is sold by who to whom in what quantities with its prime business targets. (UPDATE 7 feb. 2014: Amazon Puts Image Recognition Into Its Main iOS App – Prepare To Be Even More Showroomed, Retailers | TechCrunch. Not only can Amazon see what the buyer has bought via their checkout system it could also see what buyers considered buying.)
NB 1 One of the major strategic issues for a business conglomerate like Amazon is how to balance the various business lines. I will deal with that topic at some future day.
NB 2 As I indicated in yesterdays post the EU and the USA are not similar environments for payment services. What that would imply for services like Amazons’ and Apple wallet is dealt with at some future day.