November 16, 2010

Google Announces Next Generation Smartphone

Chief executive Eric Schmidt said this week that Google is getting ready to unveil a new mobile phone imbedded with a chip that makes it a virtual wallet so people can "tap and pay."

According to Schmidt, the successor of the Internet firm's Nexus One smartphone runs on fresh "Gingerbread" software and is imbedded with a near-field communication chip for financial transactions.

Schmidt said on Monday at a Web 2.0 Summit in San Francisco while pulling a touch-screen smartphone out of his jacket pocket that "I have here an unannounced product that I carry around with me."

"You will be able to take these mobile devices that will be able to do commerce," he continued. "Essentially, bump for everything and eventually replace credit cards. In the industry it is referred to as tap-and-pay."

The near-field chips store personal data that can be transmitted to readers by tapping a handset on a pad.

Schmidt hid markings that might reveal which company made the mobile phone.

Google worked with Taiwanese electronics maker HTC to bring the Nexus One handsets to consumers in January.

Nexus One smartphones built on Google's Android platform won raves for their capabilities but were not a hit with consumers.

Google eventually abandoned selling Nexus One handsets online, only leaving brick-and-mortar storefronts left to bring the devices to buyers.

"I don't think people understand how powerful these things are," Schmidt said of smartphones. "This is a really good day for mobile."

He said that secure chips in handsets thwart fraud better than credit cards.

Google will rely on an online payments processor to handle the mechanics of purchases made using the chips in the new phones.

A tap-and-pay component will work with a location-based feature that allows merchants to alert smartphones users of bargains available at nearby shops.

"I said there would never be a Nexus 2," Schmidt quipped. "Nothing about a Nexus S."

Schmidt told a room full of reporters that Google's ability to marry its smartphone software with Internet-based services enabled features like turn-by-turn navigation and real-time foreign language translation, which distinguished it from rivals.

"We would argue that our platform is better for applications that are network-resident and that need that kind of power," Schmidt said.


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