Mobile Wallet means many things .The future is here& how !

Google Inc. Chief Executive Eric Schmidt said Monday that the smart phone will eventually supplant the credit card – and showed off just the handset that could do it.

During an interview at the Web 2.0 Summit in San Francisco, he took out what he called the “unannounced device I carry around with me” onstage and demonstrated its ability to use Near Field Communication. The wireless standard allows consumers to make a payment, or accomplish other tasks, by waving a device over an electronic reader.

“This could replace your credit card,” he said during the discussion moderated by Federated Media CEO John Battelle and O’Reilly Media Inc. founder Tim O’Reilly.
Schmidt added that even credit card companies believe the technology is more secure than traditional plastic.

The logo on the smart phone was taped over, but it was widely believed to be the much anticipated Nexus S built by Samsung Electronics, photos of which emerged earlier this month on the tech blog Engadget. It was running the next version of Google’s popular Android mobile operating system, known as Gingerbread, which Schmidt said will become available in the coming weeks.

Google, of course, isn’t alone in pursuing the mobile-payment market.

Apple Inc., maker of the popular iPhone, is also believed to be working on so-called contactless payment technology for coming mobile devices. The Cupertino company recently tapped Benjamin Vigier as a product manager of mobile commerce, who previously focused on the NFC during stints at mFoundry and SanDisk Corp.

Meanwhile, a collection of big name telecommunications and credit card companies are testing various mobile-payment technologies, including AT&T Inc., Verizon Wireless, Visa Inc. and MasterCard Inc.

“All together, they add up to significant change,” Aaron McPherson, practice director at IDC Financial Insights, said of the trials in an earlier interview.

The Nexus S is the follow-up to the Nexus One, the powerful Google-designed and branded smart phone from HTC that came out in January. Google initially only sold the phone itself through an online store, which limited sales despite a generally warm reception among reviewers. The company pulled the plug on the device in July.

It’s unknown how the company will sell and market the new phone, or who its partners will be. It was visually clear that Schmidt’s device was operating on the T-Mobile USA Inc. network.

Schmidt spent much of the rest of the interview responding to various controversies surrounding Google and himself, including privacy complaints surrounding the images taken for its Street View product and his past statements like: “The Google policy on a lot of things is to get right up to the creepy line and not cross it.”

He joked that, from now on, he will more clearly indicate when he’s joking – suggesting that past quips have been misinterpreted as serious in the press. But he did acknowledge that the company has sometimes adopted an overly engineering-driven mind-set, releasing products without taking time to consider how they would be perceived.

“There is clearly a line that we should not cross,” he said. “What we learned is people disagree on where that line is; it’s not up to Google to decide.”

Schmidt was the biggest name speaker during the opening day of the popular technology conference at the Palace Hotel in San Francisco, produced by O’Reilly Media and UBM TechWeb.

The next two days will include talks by Facebook Inc. CEO Mark Zuckerberg, Yahoo Inc. CEO Carol Bartz and Twitter Inc. co-founder Evan Williams.

E-mail James Temple at jtemple@sfchronicle.com.

This article appeared on page D – 1 of the San Francisco Chronicle

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