Even if Starbucks has no use for the Square card reader or Register app as-is, Starbucks may influence future iterations of those products, says industry analyst Todd Ablowitz, president of Centennial, Colo.-based Double Diamond Group, LLC.

“Starbucks could adopt the Square technology and just modify it to meet their needs in a new store setting,” Ablowitz says. “If they ever have a need to walk around [and sell coffee in a mobile setting], they could plug in the use of the card reader as well.”

Even though Starbucks is picking and choosing which elements of Square’s technology it uses, this is a “big shot in the arm for mobile payments overall” because of the size of the rollout, he says. “A number of other verticals could turn over [to mobile pay] quickly.”

Ablowitz says he has been impressed with Square since Dorsey introduced the company and its concept three years ago.

From the start, naysayers criticized Square’s technology, its knowledge of the payments industry and its business model. But with Starbucks adding its support, “now what can the naysayer say?” Ablowitz asks.

Payments Source, August 8, 2012
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