Google Inc. unveiled a service to let consumers pay merchants and download coupons with a tap on their mobile phones, as the Internet search giant seeks to expand in the growing market for mobile advertising, Bloomberg reported.

Google’s new service partners with MasterCard Inc. and Sprint Nextel Corp. to let customers pay and receive coupons on the go using their handsets. The system, based on a technology called Near Field Communication, is available on the Nexus S handset, which runs on Google’s Android operating system.

The new service is expected to help Google compete for retail marketing dollars that now flow to daily deal sites such as Groupon Inc., in-store display advertisers, business directories and newspapers.

It will also help the company capture more information about consumers’ shopping behavior off the Internet, building on its knowledge of consumers’ online-buying habits.

Google is teaming up with retailers including Subway, Macy’s Inc. and American Eagle Outfitters Inc. to let customers pay for products and redeem coupons with their phones.

“For Google, it is about advertising and enabling commerce,” said Chetan Sharma, an independent wireless analyst in Issaquah, Wash., in an interview with Bloomberg. “Google wants to become the personal concierge for the consumers.”

ISIS, a joint venture of AT&T Inc., Verizon Wireless and T-Mobile USA Inc., plans to introduce a similar service in two cities in early 2012.

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http://www.bloomberg.com/news/2011-05-26/google-unveils-mobile-payment-service-to-expand-in-advertising-coupons.html