PayPal Loses A Key Player In Mobile Device Payments
Former President of PayPal, Scott Thompson, was named CEO of Yahoo last week. Thompson is well known for driving growth and development of PayPal’s recent mobile payments projects.
This is a big loss for PayPal, just months after PayPal lost key players Osama Bedier and Stephanie Tilenius to Google. Yahoo has made no moves or announcements signifying a jump into the mobile wallet war, unlike rival Google, but PayPal still lost its biggest star in the mobile payment sector.
In 2011, PayPal has been trying hard to ramp up its efforts in mobile payments and point-of-sale (POS) technology.
Before going to Yahoo, Thompson was helping forge strategic partnerships for PayPal’s entry into the mobile payment sector. He is frequently quoted on how PayPal will “really change the way people shop and pay,” but it is difficult to see how things will progress now that Thompson has gone to Yahoo.
Although Thompson’s departure has not stopped PayPal from rolling out their newest POS pilot program with Home Depot, it will be harder for PayPal to compete with the other powerhouses in the mobile payment sector. Its POS payment system also does not appear to provide any significant improvements for the shopper’s experience yet. It does not require a physical wallet anymore, but there are no apparent security improvements, and no incentives or rewards for customers.
Using PayPal’s pilot program, a customer can pay with the phone number linked to their PayPal account or with a PayPal card. But, the phone payment does not use near-field communication (NFC) technology yet. PayPal has developed apps using NFC technology, but the company does not appear overly interested in the idea of NFC payments.
In the mobile payments sector, they look as though they are playing catch-up with Google, Visa, American Express, and ISIS all having NFC wallets and programs in the works. PayPal has said that it intends to focus more on “customer loyalty” programs using its mobile payments and stress service incentives over technological advances. But Google Wallet has proven it can do that just as well, if not better.
Thompson was the most vocal, but certainly not the only person working on mobile payments at PayPal. In the coming months, we will see how big a role he had in the project and if the mobile payment projects at PayPal can continue in a successful direction.