Google opens Wallet, PayPal sues

Mobile payments service arrives to have a lawsuit shoved in its face

’Tis the season to be suing, apparently. Yesterday, Google got terribly excited about its new open platform for mobile payments. Dubbed Google Wallet, the service aims to play the long game, with Google estimating that by 2014, over 150million devices will be NFC ('Near Field Communication') capable. Google's vision is to capitalise on this shift in technology usable for payments, just as in the past payments moved from coins to paper to plastic cards.

"Google Wallet has been designed for an open commerce ecosystem. It will eventually hold many if not all of the cards you keep in your leather wallet today," claimed the search giant, adding that the system could also be used for loyalty cards, receipts, boarding passes, licences and even keys. The company is inviting banks and providers to "join us in creating tomorrow’s shopping experience".

However, the path to existence is now paved with lawsuit-shaped rocks, with PayPal hitting Google where it hurts. PayPal's lawsuit (PDF) claims two executives that subsequently moved to Google took a bunch of trade secrets with them, and Google then halted two-year negotiations between Google and PayPal regarding powering payments on mobile devices.

On its blog, PayPal senior director of global communications, Amanda Pires said: "We spend a lot of time and energy creating the things that make PayPal unique and a preferred way to pay for almost 100million people around the world. We treat PayPal’s 'secrets" seriously, and take it personally when someone else doesn’t." Unfortunately for PayPal, the company's timing makes its suit appear to be a defensive move against the might of Google as a mobile payments competitor, rather than a reaction to staff allegedly acting in a clandestine and unethical manner.