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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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tzubair
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tzubair,
User Rank: Ninja
8/31/2014 | 11:26:33 AM
Re: Rapid deplyment of NFC by Apple
"Google is wasting too much energy on useless projects like Google Glass and Google barges.  Android has too many users still stuck using Gingerbread the Dinosaur."

@steffenjobbs: I don't think that's entirely useless of them to do so. Google has been known for experimentation and that experimentation leads to innovation and new products. If you curb that, they may stop growing as a company. For every successful product, there are several failed projects and that's a norm everywhere.
tzubair
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tzubair,
User Rank: Ninja
8/31/2014 | 11:22:58 AM
Re: Apple's already destroyed market share
"For example, since Android doesn't screen apps in the app store, there have been many that are reported to be either fake, misleading, or downright malware."

@sotheco: Unfortunately that is a downside of having an open market place where everyone can be a developer and put their apps up. If they start screening it may compromise on the freedom that people have and appreciate.
tzubair
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tzubair,
User Rank: Ninja
8/31/2014 | 11:20:49 AM
Re: Apple's already destroyed market share
 

"Apple's active userbase is more than enough to support a mobile payments system for their users.  Apple isn't targeting the whole world - their own platform which will shortly hit 1 billion, was large enough years ago."

 

@rocwurst01: I agree with you. Apple has a huge user base to support the mobile payment system. I think it's a good move to start with that. Later on they can look for cross-platform support and try to integrate with the android platform. For now, I think it's a good start.
WaqasAltaf
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WaqasAltaf,
User Rank: Ninja
8/31/2014 | 11:07:17 AM
Re: Apple's already destroyed market share
Rocwurst01, I meant comparatively from the past few years when Apple was almost the sole king of the smartphone industry, now it has lost a considerable market share. Getting it back will be difficult. Let's see if mobile payments become that reason which I don't think will become. We can't deny that Apple has a loyal customer base; just that it is contracting.
WaqasAltaf
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WaqasAltaf,
User Rank: Ninja
8/31/2014 | 10:45:57 AM
Re: Apple's already destroyed market share
Stotheco, yes I agree that Apple has this positive compared to Android and when it comes to payments, security becomes a critical factors. We can also say that if Android wants to attract users interested in mobile payments, then it must take some harsh decisions regarding screening of apps based on its strength to fight viruses and malware.
Rocwurst01
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Rocwurst01,
User Rank: Apprentice
8/31/2014 | 10:45:37 AM
Re: Apple's already destroyed market share
"Apple's already destroyed market share .... The matter of concern is that Samsung and other brands have already taken many Apple's loyal customer to their smartphones"

Er, no.  Apple now has around 700 million active iOS devices only 30% less than the 1 Billion active Android users that Google reported recently.  Apple sold 238 million iOS devices last year and is on track to sell well over a quarter of a Billion iOS devices this year.

That is vastly more than the 50,000-100,000 Google Wallet users out there and is larger than the user-bases of Amazon, Paypal, NetFlix, Pandora, Zynga, Spoitfiy and eBay put together.

Apple's active userbase is more than enough to support a mobile payments system for their users.  Apple isn't targeting the whole world - their own platform which will shortly hit 1 billion, was large enough years ago.
stotheco
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stotheco,
User Rank: Ninja
8/31/2014 | 10:33:39 AM
Re: Apple's already destroyed market share
You have a good point, although it's interesting to note that confidence in app stores aside from Apple is not exactly high. For example, since Android doesn't screen apps in the app store, there have been many that are reported to be either fake, misleading, or downright malware.
stotheco
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stotheco,
User Rank: Ninja
8/31/2014 | 10:32:24 AM
Re: Fanbois
Apple's integration of iTunes with their devices can be credited much of their success. It will be interesting to see what these other providers will do in order to stay competitive.
ToniS383
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ToniS383,
User Rank: Apprentice
8/31/2014 | 9:08:18 AM
Pioneer???
I currently do mobile payments with TD Bank and my Blackberry.  How does apple claim to be a pioneer?
stotheco
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stotheco,
User Rank: Ninja
8/31/2014 | 6:27:11 AM
Re: Fanbois
Apple would benefit to open its doors for a chance, but I don't honestly see that happening soon, given the culture with which they operate. Many countries, first to third world, are adopting to mobile payments, so definitely expect to see abd hear more about it soon.
<<   <   Page 5 / 7   >   >>
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