As expected after the announcement of the purchase of key assets by Google last month, carrier-backed mobile payments initiative SoftCard (nee Isis) has announced that it will shutter the service at the end of this month and is suggesting customers move to Google’s Wallet service as a replacement. The SoftCard app and service will be available until the end of the month, but will be forced offline afterwards.
The carrier-backed SoftCard initiative was a money losing venture from its establishment in 2010 as a competitor to Google’s then-new Wallet mobile payments service. While the service was announced after Google announced Wallet, the actual rollout of SoftCard lagged Wallet by almost 2 years, with service trial dates being continually pushed back into 2012 before being soft launched in three markets starting in 2013 and suffering from low adoption by retailers, card issuers and banks as a result.
It wasn’t until last year that SoftCard reached some semblance of national visibility as McDonald’s, Subway, Wells Fargo and American Express began to support SoftCard on a national basis, but that increase in visibility did little to stem the massive losses incurred by the venture, as it lacked a coherent strategy, no doubt caused by the multiple carriers being involved and failing to agree on aspects of the venture and leaving those working on SoftCard in the dark as a result, leading to millions in losses over the life of the venture.
With Google Wallet soon receiving official, if begrudging support from Verizon, T-Mobile and AT&T through the updated Wallet and Android Pay platform later this year, SoftCard serves as a very expensive lesson for carriers that attempting customer lock-in to maximize revenue per customer is a recipe for disaster with the existence of Google Wallet and Apple Pay.