I was at the Fiserv Analyst Day on Monday and enjoyed an excellent session by Tom Roberts on social payments and the evolution of Popmoney. One slide Tom displayed has two columns of companies he categorized as "contenders" and "curiosities" for the role of social payments. Top of the column of "curiosities" was Square, which led to a conversation around the future of Square and what it will need to do to evolve.

I posed that Square's days providing card payment capture for small merchants may be numbered with the transition of the US to EMV, meaning that the increased cost of EMV hardware vs. mag stripe will make their current business model unsustainable. Given the pressure to adapt and survive, Square will have to broaden into other areas such as P2P, or an online payment gateway. My spider senses were not wrong, but the news came a little earlier than I expected.

The announcement of Square's online store telegraphs that their roadmap is increasingly virtual. Not that the world may need another online store - Etsy and EBay have done a fairly good job thus far of providing small business owners with the tools they need. However, this move expands Square's reach and quite likely complements small business owners desire to have both offline and online stores, with a one-stop-shop payment gateway for both.

A shrewd move, IMHO. What may be even more interesting is the Square / Twitter relationship, potentially enabling small merchants to facilitate transactions within tweets about their products - a synergy that seems obvious and infinitely more viable with Square's move to online storefronts. I am excited to see where this goes. I argued that Square was always a contender based on their sheer audacity in the face of the payments norm and I hope that they continue to innovate and grow. Payments needs upstarts.


About Nick Holland

Nick Holland leads JAVELIN’s Mobile practice area, working with clients to gain strategic insights into mobile trends. He oversees and tracks mobile banking initiatives, mobile infrastructure to support mobile banking, mobile marketing and mobile imaging trends.

Before joining Javelin, Nick worked at Mercator Advisory Group, Pyramid Research, Aite Group and most recently with Yankee Group heading their Mobile Money Strategies practice.

He has spoken and chaired a variety of conferences and events, including GSMA Mobile World Congress, Rutberg Wireless Innovators, Money2020, SXSW and 4GWorld and has appeared in publications and shows including The Wall Street Journal, CNN Money, NPR's "Marketplace", Forbes, Fortune, Business Week, Time Magazine, The Economist and the Financial Times.

Nick holds an MSc. degree with Distinction in Information Systems Management from the University of Stirling, Scotland (Master’s Thesis in 2001 was on Bluetooth as a payment technology), and a B.A. Honors degree in Art and Design History from De Montfort University in England.


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