PayPal Sues Google Over Electronic Wallet – PSFK
This article titled “PayPal sues Google over electronic wallet” was written by Charles Arthur and agencies, for guardian.co.uk on Friday 27th May 2011 07.28 UTC
Google’s first payments from its new “electronic wallet” system may be to the online transaction company PayPal, which claims that the company and two of its executives stole trade secrets for the project.
Unveiled on Thursday, the Google Wallet project uses a technology called Near Field Communications (NFC) to allow contactless transactions between consumers’ phones and merchants’ terminals.
But PayPal has filed suit in California following the launch in New York, alleging that Google lured away PayPal executive Osama Bedier earlier this year to obtain trade secrets that are now being used in Google’s service. The suit also names Stephanie Tilenius.
Both Bedier, now Google’s vice president of payments, and Tilenius were among those showing off the technology in New York.
The wallet app itself will require a PIN, as will each transaction. The payment credentials will be encrypted and stored on a chip, called the secure element, inside the phone. The app itself will be free to users.
Google emphasised that the wallet service would be open to all businesses and invited other banks, credit card issuers, payment networks, mobile carriers and merchants to work with it. If the phone was stolen, the credit cards inside could be remotely disabled. Consumers would have the same “zero liability” for unauthorised transactions made with their phone as they would with their plastic cards.
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