Google wants to be your wallet

Cash is dead and credit cards are dying. Your new wallet is your smart phone. Get ready for a world where every transaction will be traceable.

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The store, for example, could aggregate that information to determine that a lot of people are buying Modelo and Doritos at the same time, and may display them closer together inside the store. Or it may determine the demand for Modelo and Doritos spikes after 11 pm and institute variable pricing, charging more for it in the wee hours than it does in the afternoon.

(It may also fire that stoner/slacker employee. In the new frictionless economy, we won't need cash register jockeys.)

Google could take that information and, via its new Google Offers service, send you a coupon for your next purchase. Or Google could use its AdMob subsidiary to send your phone ads for competing products like Corona and Fritos. (And Apple, which will surely offer NFC payments at some point for the iPhone and iPad, could do the same with its Quattro mobile ad service.)

This type of thing already happens in a limited way with supermarket frequent shopper cards; soon it will happen with everything.

Your bank could collect that purchase information and sell it to data brokers, who in turn could sell it to whomever might show an interest. Alcohol and high sodium foods are certainly not good for you -- that’s information your health care provider might be willing to pay for (kiss those “healthy eating” discounts goodbye). Wait, aren’t you in AA? Your estranged spouse’s attorney might be very curious as to what you’re about to do with that six pack. And so on.

I’m not saying all of this will happen. I’m just saying there’s nothing to stop it from happening. When all transactions are traceable – and cash payments become the kind of thing only the very poor or the very criminal rely on -- all kinds of things can happen to that data. Some will be highly convenient; others, not so much.

I won’t even get into the security issues this raises, though it’s pretty clear smart phones just became an even more tempting target for hackers.

But, like I said earlier, frictionless tap-to-pay systems are inevitable. Best to go into them with your eyes wide open.

TY4NS blogger Dan Tynan is now dreaming about chips and beer. Visit his eHumor site eSarcasm or follow him on Twitter: @tynan_on_tech.

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