Google vs. Groupon:

 Last year, Google tried to buy Groupon but failed. So Google now hopes to beat Groupon.

Eric E. Schmidt, Google’s executive chairman, said Tuesday that the company would begin testing Google Offers, a Groupon-like service delivering discounts from small businesses, starting on Wednesday in Portland, Ore. The test will be expanded to San Francisco and New York this summer.

As the company indicated earlier this month, Google Offers will be tied to Google Wallet, a mobile application that allows people to use their phone to pay for purchases. Stephanie Tilenius, vice president for commerce at Google, said the company would not charge customers or retailers for the Wallet application or for payments, but will monetize the service by taking a cut of offers or coupons that people buy.

Ms. Tilenius admitted that Google Offers would compete with several other “deals” services, but said that it was the only one combining offers with mobile payments, making it easier to use.

 The announcement of the Portland test was part of Mr. Schmidt’s on-stage interview at the AllThingsD conference in Rancho Palos Verdes, outside of Los Angeles. During the wide-ranging interview, Mr. Schmidt took responsibility for Google’s failure to recognize the importance of social networking.

Mr. Schmidt said that four years ago, he wrote memos about the importance of social identity, but failed to act on them. He said that he repeated the same mistake three years ago.

“I clearly knew I had to do something and I failed to do it,” he said. “I screwed up.”

Mr. Schmidt said that under its co-founder Larry Page, who became chief executive in April, Google reorganized itself to focus more directly on seven product areas. He said he hoped that the new organization would help the company to avoid similar mistakes and to operate faster.