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Visa and IBM Watson today announced a partnership to use the Watson IoT platform to extend digital payments to connected cars, wearables, and other devices.
The announcement was made at the Genius of Things Summit in Munich, Germany as part of the grand opening of a $200 million IBM Watson global Internet of Things headquarters.
“We share a vision of commerce-based IoT where any device, from a watch, ring, an appliance, or car, can be used to make a purchase. Our goal is to enable commerce on any connected device anywhere,” said IBM Watson general manager Harriet Green during a press conference today.
Payments will rely on the Visa Token Service, a digital identifier for payment processing that first debuted in 2014. Apple Pay, Samsung Pay, and Android Pay were version one of these tokens. The IBM Watson IoT platform will help Visa scale to the 20 billion wearable and connected devices expected by 2020, he said.
“When we think about the future of IoT, certainly from a connected perspective, we have an opportunity to extend our platform into all sorts of devices where the historic card and terminal just doesn’t work,” said Visa executive VP Jim McCarthy said onstage at Genius of Things Summit today in Munich.
Payments of this kind will require not just innovation from IBM and Visa, but what McCarthy called “the building of an ecosystem” by both governments and businesses to ensure that stores and the parking meter on the sidewalk are equipped to handle payments.
“Most of the physical services providers we see envision themselves selling a service in the future, so instead of selling your device as the only business model, we envision renting it as a service,” IBM Watson general manager Chris O’Connor told VentureBeat in an interview.
Visa and IBM envision a time when all payments at gas stations will be handled before you set foot outside your car, but they aren’t alone in this ambition.
Yesterday, Jaguar and Shell announced plans for in-car gas station payments, and at the Computer Electronics Show (CES) last month, Visa and Honda rolled out a feature that pays for gas and parking meters with a token in a Honda vehicle.
Other use cases IBM envisions include selling new shoes to a jogger after running a specific number of miles, or ordering car parts or maintenance when a warning light switches on in your car.
IBM Watson paid for travel to report on the coverage of the opening of the Internet of Things headquarters in Munich. Our coverage remains objective.
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