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Verizon Is Blocking Google Wallet Anti-Competitively (dslreports.com)
261 points by mtgx on Dec 21, 2012 | hide | past | web | favorite | 82 comments

First Google voice, now this. Le sigh...

I was in the business of mobile applications pre-iPhone, the era of phone companies picking winners or trying to do things themselves and the net result was that most mobile functionality beyond the basics was garbage. Not just the devices but the poor choices mediocre people at some high-mid level in the phone companies would make on all kinds of weak decision making criteria led to bad poorly thought out software choices, both on the consumer side and the enterprise side.

Of course carriers thought it was in their best interests and that they could beat market based product discovery. Neither was really true as the explosion of innovation caused by the iPhone and the cadre of early post-iPhone mobile app developers demonstrated.

This kind of move by Verizon is a misguided step back to that world. It's frustrating and stupid and in the long run unlikely to be a win for Verizon, despite any short term gain for some internal project or other built by a second rate team put together to defend someone's budget allocation.

Why the mention of Google Voice? I've never had an issue using Google Voice w/ Verizon, all the way back to Droid OG days.

I moved to Verizon on my birthday on the 8th of this month. Finally ditched T-mobile to get an iPhone. I have been using Google Voice as my sole number for years now. It's very important to me. I even explained this when buying. Turns out that unannounced Verizon has started blocking Google Voice verifying your number do I cannot use it. At first I thought it was a blip but lots of Googling has discovered this appears to be a change as it's hitting everyone. If anyone can show me a fix and where I'm wrong I will happily stand corrected. But to this date every attempt to get my phone added to Google Voice has failed and blocking appears to be going on. I would not be surprised if existing iPhone Google Voice users are fine if they've already verified their number. I have no idea.

> Turns out that unannounced Verizon has started blocking Google Voice verifying your number do I cannot use it.

How exactly do they block it? According to the verification instructions[0], Google Voice calls you and asks you to enter a verification code. How can this be blocked? It would be like any other DTMF service. Also, isn't it illegal to block this?

0: http://support.google.com/voice/bin/answer.py?hl=en&answ...

Oh, I know how it works :-) ...it just doesn't any more. I don't know of any legality blocking such a call but I can assure you no matter how many times I trigger the verification process I get nothing but an error message and no call or text from Mr Google.

I successfully verified my new Verizon number last month

Right. So I understand. People seem to have started reporting issues since early December. I know you COULD do it on Verizon ...I wouldn't have considered them otherwise. It's just disappointing that they appear to have made a recent decision to change that.

Comments like yours kept me trying.... so, for completeness after a month of trying it's now verifying - so maybe it was a blip, maybe they tried something and thought better of it.

I don't know about Verizon but I was unable to verify myself to craigslist using my Google Voice number earlier this year.

A lot of Google Voice numbers appear in a number pool marked for prepaid cellphone plans and a number of services will blacklist such numbers for use for identity verification. Sad but true.

Um, this makes complete sense. The point of number verification in this case is that phone numbers are expensive to acquire so banning has real consequence. GV and prepaid numbers are cheap to acquire so they're no use for verification.

You still have your cell phone provider's number and you should just use that to verify.

My cell phone provider is Virgin Mobile, so still screwed on that front.

While there is a certain logic to this system historically, I don't think it makes a lot of sense anymore as prepaid cellular is quite popular and getting more and more so.

As I've commented elsewhere today, I thought I should return and make the note - to be fair all around - that today, finally after trying since early December (so for at least three weeks), it verified. I don't know whether this means Verizon had a problem, or a policy they tried and backed off from... but it will work now :-) ...well, today at least.

On one hand I want to try. On the other hand I'll be furious if VZW actively attempts to keep me from having that functionality.

Why would they care?

I've been trying to fathom that myself. It could be Apple pressure; it could be their intention to bring out a competing service; it could be they feel this competes with an existing service. It may just be a way to push more people into porting numbers in some misguided attempt at raising the hassle factor of leaving Vz in the future. Whatever the reasoning I think it's short sighted and I find it very frustrating.

For completeness after a month of trying it's now verifying - so maybe it was a blip, maybe they tried something and thought better of it.

Somewhat my area of focus.

The SE Isis uses is on the SIM, the SE GoogleWallet uses is Embedded on chip. Two different types, chosen primarily around distribution mechanisms each could protect. Google felt if it were embedded, its relationships with OEM's would primarily help its case. Carriers went the SIM route primarily due to them being the only distribution channel that matters in the US for phones.

Google Wallet can potentially work off of a SIM based SE. But this would mean that Google will have to work with in the parameters of Carrier's Isis framework. Isis framework is different in that it has no visibility in to the transaction data. Google will have to opt in to this approach (Banks require it because they fear Google). Google wants data and will never agree. Yada Yada Yada.

Verizon did block Google because of its stake in Isis. And because Banks would have explicitly sought out Carriers to block GoogleWallet on Carrier phones. Google could work with Isis with in its own framework, but it never will. Competing interests, revenue models and goals.

That still doesn't make it right, though, and it's still anti-competitive. I mean who is Verizon to say that a company can't run a certain type of app on "their" phones, because they are not even their phones. They are their customers' phones.

It's especially troublesome when Verizon is creating a competing app, and they are just giving a more or less "reasonable" excuse to completely take out their competitor from the market, much like Apple is doing with the browsers on iOS. The difference here is that these carriers almost completely own the US market, and them joining together like this to stop Google from putting the app on their phones is kind of a cartel movement, isn't it?

At the very least, I think this is worth an investigation from FCC and FTC.

The billions of dollars that could be used to lobby special interests into law is who's trying to say they can't run it on 'their' phones..

Actually, it's not just anti-competitive, it's plainly illegal for Verizon to be messing with Google Wallet or Voice on any of its 4G phones.

Verizon licensed the C Block in 2008, which come with rules that REQUIRE it to allow any phone to run any app. Unfortunately the FCC has been gutless about enforcing the rule. It took the agency 10 months to force Verizon to allow tethering apps in Google App store. If they'd had any guts, they would have banned Verizon from selling the 4G iPhone which, as a locked down phone, is arguably illegal under the rules.

In fact, Google argued that it would be illegal for Verizon to sell a locked down phone on that spectrum, but then once it started to need Verizon, it refuses to stand by its earlier rules.

And these rules matter a lot, because come spring, a federal court will rule that the FCC's net neutrality rules have no legal basis and the ONLY net neutrality rules left standing will be the ones on Verizon's C Block.

The rule requires that Verizon not block phones or apps. It doesn't say anything about Apple blocking apps for its own reasons, or Google blocking apps because Verizon is leaning on it on the sly.

"allow any phone to run any app"

The ability to run the app =/= which default apps are on the device.

AFAIK they block installation from the Play store.

My bad, looks like this is the case. TFA linked to [1] which seemed to only indicate that VZW wasn't allowing it as a default app. But [2] and elsewhere indicated VZW had also asked Google to not allow the app on Verizon devices.

[1] http://www.dslreports.com/shownews/Verizon-Were-Blocking-Goo...

[2] http://www.droid-life.com/2012/12/10/verizon-responds-to-fcc...

Vote with your wallet and ditch Verizon

And by the way, people should have done it and use a technology that doesn't tie your mobile phone to a service provider: GSM

I think the biggest detriment to the adoption of these mobile payment platforms is going to be trust. There is no way I'd trust a platform like the Isis one that was mentioned in the article to act as my mobile middle man for transactions. Many of those companies have a less than stellar reputation with customers that tends to lean toward the "necessary evil" side of things.

The last thing I'd want to do is give them more personal info, more of my money, and give them more control. I'm probably the minority though.

How is it done in Asia where this is already much more popular? Who controls the payment platforms the banks? the mobile carriers?

> How is it done in Asia where this is already much more popular?

In Japan, Osaifu Keitai[0] is a partnership between the major carriers (NTT DoCoMo, au, and SoftBank) that uses technology developed by Sony.

0: http://en.wikipedia.org/wiki/Osaifu-Keitai

The Asia Thing: In China, the government has effectively mandated a single payment network, YingLian (or China UniPay), which affects all banks and cards. Innovation is thus low and all things move slowly. Online payment portals typically require the entry of card details, a web redirect to the issuer bank in question, and the entry of further authentication credentials. With credit card penetration shockingly low, this is still the norm. People frequently still line up at a bank to send money to other provinces. With Google Play purchases blocked in China, mobile payments for non iDevice users (Apple devices are considered the de-facto luxury standard; contrast Indonesia where this is still BlackBerry) are still 'out there'. Interestingly but somewhat tangentially, the YingLian network is expanding quickly, notably with Chinese banks opening worldwide and particularly in Southeast Asia, where it is often accessible via local banks' ATMs along with Visa and Mastercard networks (the typical western global ATM network, Cirrus/Maestro, is AFAIK owned by Mastercard, which itself is owned by Bank of America). This helps to provide backing for the Chinese Yuan Renminbi (CNY) as a regional reserve currency, serving a geopolitical interest.

US-wise: I integrated in-App payments for the flagship preloaded app on behalf of a major Android device vendor who you can probably guess with AT&T and T-Mobile. One of those carriers was completely unable to block consumers calling up and retroactively renegging on payments via their customer service center; ie. fraud issues. Both of them seemed to outsource their internal billing systems to AMDOCS (http://en.wikipedia.org/wiki/Amdocs) who at least partly hosted those systems offsite(!), and are an Israeli, widely thought to be Mossad-backed and intelligence-gathering oriented company. This is something of an open secret in the international mobile carrier space. Smart cookies, those Israelis!

International: Outside of credit and debit card networks, which are basically US owned and operated with the exception of China's emerging YingLian network, SWIFT is the major international payment facilitator. Check this out: http://www.asktheeu.org/en/request/intra_european_financial_... .. plus linked FOI requests. All SWIFT transactions have been fed to the US unfiltered since 'at least' 2001 (source: European Data Protection Supervisor), and probably since the founding of their first 'international operations center' in Virginia (~CIA HQ), in 1979. Indeed, to the casual observer, SWIFT appears to be a successful combination American Express/CIA project from that era.

You get the phone subsidised from the retail price of $600 to $100, and your carrier gets you to drop your pants.

You should totally find a way to reduce carrier to a dumb pipe. Everything carriers (or ISPs) try to add to the service is awful, harmful and anti-market. Make them just provide the connectivity and shut up.

You say that as if the carrier is "eating the price of the phone" or something, and even if you didn't mean it like that, I think that's how most people see it. When in fact it's not anything more than sending them payments for the phone every month, instead of paying for it all upfront. And I mean that on top of the price you pay for Voice and text. If anything, they even make a nice profit on those payments for the phone - probably a lot more than a bank gets on a credit.

They are sneaky though. The reason they get you to think that is by keeping the plans prices the same, even if you come with your own phone. In Europe, if you use your own phone, the plan is significantly cheaper than when getting it with a phone, especially if it's a pretty high-end phone.

The problem is that they're not just "eat the price of the phone by making plans fatter". They're "eat the price of the phone by making plans fatter AND your phone dumber, less useful, less secure and less predictable".

This is true across more than just consumer cell phones. I had our AT&T rep in out office the other day and he started trying to sell me...

...hosting. AT&T is better than AWS because they have teh cloudz. OH! And programming! AT&T wants to bundle some programmers with our cell phones.

> You should totally find a way to reduce carrier to a dumb pipe

That's what ISPs were until the Clinton era, when they made some sweeping regulatory changes that led to the situation we have today.

I'd like to read more about this please.

Googling "ISP rule changes during clinton era" brings up ...http://en.wikipedia.org/wiki/Telecommunications_Act_of_1996

Thank you. So deregulation happened.

In there any electrical customer anywhere who wants the utility to say what they can and plug into the wall sockets based on whether or not the utility also sells competing products? ("Sorry, but your fancy new toaster doesn't come from Pacific Gas & Electric. Here, buy our crappy overpriced version instead.")

By the same token, is there any data provider model that (a) customers want and (b) works the same way? The idea that buying a phone from Verizon makes it "their" phone, which they can then control in whatever way benefits them the most is just anathema. It's like an ISP saying you can't use your Mac because they have a deal with Microsoft, and if you want to get online, you need to buy Windows 8. On a machine bought from them.

Virtually EVERYBODY wants a dumb pipe delivering commodified data. People will pay for bandwidth (high or low) and latency (short or long). The market can price each according to demand and the constraints of available technology. And providers, being utilities, should be able to count on a low but rock solid margin of profit.

And if you're in the data access business, you should absolutely barred from any other line of commerce on the grounds that it will represent a conflict of interest. To the extent that data service (esp. wireless) depends on a public resource (spectrum), there should be no question here.

I mean, data is a utility. Like water, like gas, like electricity. Just add a meter, deliver the goods, and get the hell out of the way.

> Virtually EVERYBODY wants a dumb pipe delivering commodified data. People will pay for bandwidth (high or low) and latency (short or long). The market can price each according to demand and the constraints of available technology. And providers, being utilities, should be able to count on a low but rock solid margin of profit.

True on the logical level, false on the human level.

If carriers became just & only that, providing dumb pipe service for a flat monthly rate, things might well be better overall.

Unfortunately it's hard to lobby the public on a coherent dream. Sure, many people who think much about the market may agree, but all the staff at all the carrier phone shops, and their families, will campaign against you. As will all the bribery dollars of the telecoms companies.

You'd be shot down in flames for trying to regulate this. Congressman in narrow districts would get warned off by angry potential voters, the mass public would be advertised into uncertainty, etc.

One thing not commented on in this article is that AT&T and T-Mobile are doing the exact same thing. Of the big 4 US carriers the only one not explicitly blocking Google Wallet is Sprint.

I use Google Wallet on my Galaxy Nexus using T-Mobile. (Or at least I did use it until my free $10 ran out. I don't get how it's supposed to be more convenient than swiping a card.)

Verizon won't let phones access their network if Google Wallet can be installed. That is significantly different from every other network.

>I don't get how it's supposed to be more convenient than swiping a card

Well I think this is the general thinking that is stopping adoption moving forward. Its one of those things that doesn't provide a small incremental value, but in the overall big picture is a huge convenience. When you look at countries like Japan and Korea that has widely adopted NFC for just about everything, its a convenience that you carry around a lot less and everything is integrated in one spot. Google Wallet is just the beginning

For some people with multiple cards to be used in different stores for example Costco only accepts american express and thats the only store I will use it at, a system like Google wallet simplifies the management of having multiple cards.

I would totally use the shit out of NFC if I could get a more secure transaction (i.e. pin/password required to be enter into my own phone -- i.e. essentially extending two-factor to my credit card transactions). i.e. better protection than stealing my physical wallet. I'd also love to get itemized receipts emailed or whatever instantly in some sort of standard markup format for analysis and record keeping.

I don't actually have a NFC phone until xmas, so I don't know if it does all of that already anyway.

For reference, square gives me the heebie-jeebies. Oh sure, swipe my card into the freaking audio jack your cell phone running who-knows-what software you've got on there and let me smear my finger to make some sort of unintelligible mark on your screen that counts as a "signature". So basically all you need is an audio chirp played over 3.5mm and some indistinct finger dragging to make a purchase. Right. Sign me up...

> if I could get a more secure transaction (i.e. pin/password required to be enter into my own phone -- i.e. essentially extending two-factor to my credit card transactions)

Google Wallet has a PIN code on open.

My problem was that I could not find any place in town to use it. The one pharmacy that had a machine and was selling amazon gift cards did not have its nfc reader working. I finally contacted google and asked for a refund for my $10.

A refund for the free money they offered you? How is that going?

Google has a process set up for doing exactly that. It's less outlandish than it sounds.


> Verizon won't let phones access their network if Google Wallet can be installed. That is significantly different from every other network.

That's not true. I use a sideloaded Google Wallet on a Verizon Galaxy Nexus just fine.

Google Wallet is in Google Play on my phone. It isn't on Verizon phones. There is a distinction.

Semi-related question:

How difficult would it be to disrupt the cell phone market? I used AT&T for a few years and now I have been using Verizon for 2 years, in my dealings with these companies I have found them to be much more scummier than almost any other industry out there. They have the most complicated policies where even if you try to do everything right, you will still get dinged with fees every now and then.

Are these companies really scummy or is it just the nature of the business? I know certain industries are very difficult to operate due to specific issues like scammers and online payments (I believe PayPal were the first ones to get it right and they are one of the most hated companies).

Is it possible for a company, let's say Google, to provide an unlimited data/calling plan for a reasonable cost without all of the hidden fees and charges?

> How difficult would it be to disrupt the cell phone market?

Well, to start you'd have to do is build a couple of hundred thousand cellphone towers, at a couple of hundred thousand dollars apiece.

You're leaving out the part where you purchase a swatch of spectrum for billions of dollars from the US government.

Well I understand that but I guess my main question can be condensed into the following: Do the big cellphone companies appear to be scummy because the industry is difficult to turn a profit in, or are they just 'poorly' run companies?

I don't think a non-evil carrier could compete against Verizon and AT&T. Human psychology is so susceptible to "pay less now but more later" and "shiny widgets that don't work" that companies cannot afford to do the right thing. Just look at how T-Mobile is considered too weak to survive by many analysts.

Is it possible for a company, let's say Google, to provide an unlimited data/calling plan for a reasonable cost without all of the hidden fees and charges?

It's possible in the sense that Google could become an MVNO (virtual network operator) and piggy-back off an existing network.

Except that network would have to allow them. And charge them a large price for it. So in effect, no, it isn't possible.

It certainly works for some. Giffgaff in the UK use O2's network, but have lower (and more predictable) prices.

There are a lot of MVNOs in US too. Also GiffGaff is owned by Telefonica (O2).

This didn't seem to stop them with Google Fiber, though.

It's always possible to lay new fiber. Wireless requires spectrum, which is finite and heavily regulated.

I have no idea why you'd think that would stop them given how they've been involved with it off and on since at least 2008.


As far as I know they Google is using it's own network for Google Fiber.

It's the network effect, AT&T and Verizon have the biggest networks, therefore the most valuable.

Apparently there are lots of pre-paid plans that do what you want using the big networks, not to mention T-mobile and Sprint with their smaller networks.

That's not a network effect. A network effect is a growth pattern related to having other users on the network adding value to you. In this case, it wouldn't matter if I was the only AT&T customer, they'd be more valuable simply because of coverage area.

I suspect that competing with cell service providers in the USA is very difficult, but slightly easier than competing with the Post Office for providing first-class mail service, competing with the US Mint by minting your own currency, or competing with the US military for providing national defense.

I can't help but think that NFC and the technical implementation differences between Isis and Wallet are a total red herring as far as consumers are concerned. Isis have already stolen the momentum but have wasted it with inaction. Non-NFC fully-online payment systems (square, Starbucks) have meanwhile grown successfully.

Google pushed hard for adoption from terminal providers and retailers while Isis have done very little to develop a real platform until very recently. The result, frankly, is that you aren't likely to need to tap your phone to conduct business, instead you'll press a button on your phone. And no consumer will care.

So Verizon ultimately loses out on a massive transaction market by trying to fight Google.

Correct me if I'm wrong, but the "secure element" is ARM's TrustZone [1], that is found on every ARM Cortex-based device out there, right? Or is there anything special they are adding to some of the latest ARM SoC's in phones? If it's TrustZone, then Verizon has been lying about this from the very beginning.

[1] http://www.arm.com/products/processors/technologies/trustzon...

Application Examples for TrustZone:

• Secured PIN entry for enhanced user authentication in mobile payments & banking

• Anti-malware that is protected from software attack

• Digital Right Management

• Software license management

• Loyalty-based applications

• Access control of cloud-based documents

• e-Ticketing Mobile TV

No, typically it's a separate chip, like the NXP PN65

The secure element is typically on the NFC chip.

Actually, this is untrue, and I know of no NFC ASIC with an integrated secure element (not NXP, nor Sony); the ASICs are typically just transceivers (the exception being an NXP ASIC with embedded MiFare). The SIM has been identified for a long time as the probable security element for NFC. However, this has long been a point of contention, and Gemalto (the largest SIM provider in the world) has been playing both sides quite evenly.

Hmm, I had this in mind:


"Featuring a NFC radio controller and an embedded Secure Element, the PN65N is also fully validated and integrated on the latest release of Android™ 4.0."

Admittedly, my knowledge is a little bit out of date, but that is one chip out of several that I know over the last 7 years. You used the word "typically," and as you can imagine, the telcos have a preference for treating the SIM as the secure element because they control it; in the US the telcos dirve the majority of mobile sales.

This is a slightly sore subject as I worked for a startup that is now a zombie, having attempted to wait out the fight over who would control NFC payments (telco vs. credit card company).

Look at the just announced chip from Broadcom which supports "multiple secure elements to ensure all payment business models are supported for today's market.": http://seekingalpha.com/news-article/5050981-broadcom-launch...

Can you use Google Wallet on a rooted phone?

I don't believe you even need to root to sideload Google Wallet. I installed and regularly use Google Wallet on my Verizon Galaxy Nexus. I'm running the Bugless Beast ROM which comes rooted but I don't think I needed to be rooted to do it. In fact Google Wallet displays a warning saying your device isn't supported if you are rooted (the app still works fine though). Verizon just blocks it in the Play Store. If you get your hands on the APK it should install fine like it did for me.

As far as I know it works perfectly but Wallet will complain about the security implications of the phone being rooted.

If you are using Verizon, no. I have a rooted Galaxy Nexus Prime running CyanogenMod 10, and the Play Store has always said, "Your device isn't compatible with this version." when attempting to install/upgrade Google Wallet.

When I first got this phone, before rooting it, I had found a "sideloaded" apk of the app which worked for awhile, but I was unable to upgrade to newer versions of the app easily.

> If you are using Verizon, no. I have a rooted Galaxy Nexus Prime running CyanogenMod 10, and the Play Store has always said, "Your device isn't compatible with this version."

I'm assuming you were running a pre-release build; Google Play/Google Wallet payments have always had a spotty track record on non-stable releases of CM. I was able to run Google Wallet just fine when I was running an older version of CM (rooted).

But you don't need to root to sideload it, either, even if you're on Verizon.

My only successful Google Wallet experience was before both rooting and installing CM, with a sideloaded apk, using the build that shipped with the phone.

No offense, but just having root doesn't magically change the behavior of the store.

I hope I didn't inadvertently imply a correlation between phone rooting and Play Store behavior. It doesn't work for me now because Google wants me to upgrade my currently installed sideloaded version of wallet in order to function at all, but the Play Store won't let me and I'm tired of sideloading the app.

Yep. That combined with the fact that every single checkout counter in my city has their NFC receiver disabled, I just gave up. It's a long rant and I'm on mobile but NFC for payments in its current form was dead on arrival in my opinion. It could be done correctly but it's not.

I wish that it wasn't do risky and capital heavy to get into the payments game...

My AT&T HTC One X has NFC, but it will absolutely not install Google Wallet, even when rooted.

You can't install it from the play store but side-loading works fine with or without rooting the phone. You have to continue to side load all updates though so keep that in mind.

It's Android, you don't need root to install apps that Verizon doesn't want you to get from the Play store.

Hm.. All this sounds really wrong (as well as having 4 major internet/cell/phone/tv providers for the whole USA)

May be something like internet/infrastructure regulation similar to Israel could help to solve this problem. http://www.iasps.org/bezekisp.htm

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