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8/30/2014
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Apple iPhone 6: Mobile Payments Pioneer?

Apple's latest iPhone could help bring mobile payments to the mainstream.

8 Things We Want In iPhone 6
8 Things We Want In iPhone 6
(Click image for larger view and slideshow.)

The tech industry has made a number of attempts to ignite interest in mobile payments, and so far all have fizzled out. Sure, Google Wallet is still around, and Isis is available on a wide range of smartphones, but almost nobody uses them to pay for real goods in real stores. Apple, which might add such functionality to the iPhone 6, could change that.

The company has scheduled a media event for Sept. 9, when it is widely expected to debut two new iPhones and a smartwatch. The next-gen iPhone will differ from previous devices in many ways. Though many consumers may fixate at first on the larger screens (4.7 inches and 5.5 inches), others will be thrilled to learn the iPhone 6 adds NFC for the first time. NFC and mobile payments "will be one of the hallmark features of the device," according to Wired, which cited sources familiar with Apple's plans.

Not only will the device have the necessary components for mobile payments, but Apple is also well positioned to debut its own mobile wallet. As Wired points out, Apple has more than 800 million credit cards on file through iTunes. Further, it has invested in its Bluetooth-based iBeacon technology and has a massive user base eager to adopt new technology. Apple has patented ways for NFC and Bluetooth to communicate with a "secure element" -- needed to protect user identity and bank account data -- within the device, and Apple has held discussions with payment companies in recent months.

[Will Apple's upcoming smartwatch also give the wearable device market some much-needed disruption? LG, Samsung Debut Smartwatches, Apple Lurks.]

These signs all point to one logical conclusion: Mobile payments are about to take off.

Today's solutions are laudable but clunky. Google Wallet, for example, requires NFC and a Google Wallet account to function properly. Sadly, few retailers accept Google Wallet at their terminals. The same is true of Isis (which is rebranding for obvious reasons). It launched in November and is available on millions of devices throughout the US. The effort is backed by AT&T, T-Mobile, Verizon Wireless, and a growing number of retailers. But those retailers are still too few and far between -- "Pay with Isis" signs are hard to find in the real world.

Visibility is a real problem for mobile payments, and that's where Apple can differentiate and possibly succeed.

Consider its own retail stores. Apple Stores are found throughout the world, and Apple could easily allow iPhone owners to enter one and make a purchase by simply tapping their iPhone to another device. Then there's Passport, Apple's loyalty card account management system. Apple could give Passport-enabled apps preferential treatment when it comes to making mobile payments, or even just gently remind iPhone owners that they can use their device at the register. Apple has already given the iPhone a fingerprint sensor for security. The iPhone 6 will surely carry that feature over to help reassure iPhone owners that their data is safe and protected with their unique biometrics.

All the pieces of the puzzle are lining up for Apple and mobile payments. If Apple is able to convince iPhone users to make mobile payments, perhaps other mobile payment services will see a boost, too.

If the world wasn't changing, we might continue to view IT purely as a service organization, and ITSM might be the most important focus for IT leaders. But it's not, it isn't and it won't be -- at least not in its present form. Get the Research: Beyond IT Service Management report today (free registration required).

Eric is a freelance writer for InformationWeek specializing in mobile technologies. View Full Bio

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SteffenJobbs
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SteffenJobbs,
User Rank: Apprentice
8/31/2014 | 6:06:43 AM
Re: misinformed!!
If Apple gets mobile payments to drastically increase using the iPhone 6 and NFC then they are geniuses.  They keep saying that Android has had NFC for years and I agree.  So why the hell doesn't Google take advantage of all that market share and clout and get mobile payments going?  Apple is going to take advantage of those 800 million iTunes accounts/credit cards and set the mobile industry on fire with NFC.  It will prove that Google and Android aren't capable of doing anything worthwhile despite all those high market share numbers.  Apple and iOS will be considered the geniuses and Google and Android will be numbskulls.
WaqasAltaf
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WaqasAltaf,
User Rank: Ninja
8/31/2014 | 4:24:04 AM
Re: Fanbois
Fanbois, you do make a point about regional share of Apple and not global one. That being said, may be Apple's iphone 6 can use this feature to get back its global glory. But I just can't buy it at the price at which Apple offers usually.
WaqasAltaf
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100%
WaqasAltaf,
User Rank: Ninja
8/31/2014 | 4:21:40 AM
Apple's already destroyed market share
Eric, due to already established market of online payments as a result of itunes, I agree that mobile payments will also gel in good with Apple's service. The matter of concern is that Samsung and other brands have already taken many Apple's loyal customer to their smartphones so even if iPhone 6 offers this there will not be a large user base to adopt this payment mode. And the price factor will deter more customers because one thing is inevitable; Apple cannot charge a low price.
Rocwurst01
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Rocwurst01,
User Rank: Apprentice
8/31/2014 | 3:37:13 AM
Re: Fanbois
And yet NFC and mobile payments have been a failure in the rest of the world with Google Wallet only managing to garner a dismal 50-100,000 users.  Even PayPal only has 123 million users, Amazon 243 million, eBay 112 million.

Apple's worldwide userbase of 800 million active credit card enabled iTunes/App Store users utterly dwarfs these other solutions in terms of take-up.
jgherbert
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jgherbert,
User Rank: Ninja
8/31/2014 | 12:16:01 AM
Wait, What?
I keep hearing that if there's NFC (and mobile payments) in the iPhone 6, this will signal the start of the mobile payment revolution. It's funny though, Android is by all accounts the biggest selling mobile OS and sells the most handset units, and so forth. Many Windows Phones also support NFC. Despite that, mobile payments haven't made it big yet. Is it really just because Apple hasn't caught up yet? I don't see quite how that works.
PedroGonzales
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PedroGonzales,
User Rank: Ninja
8/30/2014 | 10:02:44 PM
Re: Fanbois
there may be a usability issue with electronic payments in the U.S.  I read articles that in many developing countries they already have electronic payments available.  The problem will be that if apple electronic payments take off, it will fragment the market because it would leave android users outside its system.  Unless, other companies collaborate with apple.  I think it will be difficult to become dominant payment system   
hiram01
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0%
hiram01,
User Rank: Apprentice
8/30/2014 | 4:56:14 PM
Re: misinformed!!
That's because the party is dull and boring until Apple arrives! If Apple doesn't come to your party, it's a flop.
StubbornOx
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StubbornOx,
User Rank: Apprentice
8/30/2014 | 2:57:11 PM
Fanbois
American's sure are excited about the prospects of Apple and NFC.  The rest of the world yawns as it's been around for years on other phones.

Of course the same people excited about this probably think Apple invented the mouse and the tablet PC.

Enjoy your Galaxy S4 Fanboi's.
Bobbydig
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Bobbydig,
User Rank: Apprentice
8/30/2014 | 1:53:11 PM
Re: misinformed!!
It's funny that Blackberry and Android introduces features that no one uses. Same had with USB, until Apple entered the game. It's not about being first, its coming to the market at the right time. Sorry folks, this is where Apple is a genius and where as the rest fail. 
mrsinisterlefty
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0%
mrsinisterlefty,
User Rank: Apprentice
8/30/2014 | 11:38:53 AM
Re: misinformed!!
Same old same old. Apple comes to the party late and the Tech press hails them as geniuses.
<<   <   Page 6 / 7   >   >>
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