Best Buy is expected to be among a group of 14 merchants that will launch a… (Justin Sullivan/Getty…)
A group of 14 merchants is expected to announce a joint venture to create a mobile payment app that would compete with Google Wallet, start-up Square and others, according to a report.
The group, which includes Wal-Mart Stores Inc., Best Buy Co. and Target Corp., is expected to announce the news Wednesday, and the service is expected to be called Merchant Customer Exchange, or MCX.
It's unclear how much each company is contributing to the effort, but the network of merchants also includes 7-Eleven Inc., Alon Brands Inc., CVS Caremark Corp., Darden Restaurants Inc., the HMSHost unit of Autogrill Spa, Hy-Vee Inc., Lowe's Cos., Publix Super Markets Inc., Royal Dutch Shell PLC, Sears Holdings Corp. and Sunoco Inc.
The network has yet to set a launch date for MCX or find a chief executive, but the merchants are set on jumping into the market, which is expected to balloon to $600 billion by 2016 compared to $172 billion this year, according to the Wall Street Journal, which broke the news.
The news comes about a week after Starbucks announced it was partnering with and investing in Square, one of the leaders in the market. That news was seen as a huge break for the mobile payments start-up, which uses a card reader to accept payments.
But MCX will now not only give Square more competition but it likely also takes away 14 companies that it could have partnered with, including some major players.
MCX is also bad news for Google, which has been expanding its Google Wallet business slowly over the past year. Google Wallet uses a technology called near-field communication, or NFC, to make payments by just placing a phone near another NFC-enabled device that takes the payment.
The new merchant group plans to use MCX to give customers personalized deals and promotions, like some of its competitors do or have plans to do, according to the report.
Swedish firm's Apple hoax shows gullibility of online readers
Pinterest makes a big mobile play, rolls out Android, iPad apps
Microsoft Surface with Windows RT to sell for $199, report says
Follow Salvador Rodriguez on Facebook, Twitter or Google+