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8/30/2014
08:06 AM
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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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melgross
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melgross,
User Rank: Ninja
9/1/2014 | 11:23:41 AM
Re: Umm
If this works the way Apple has been running iTunes, then you won't have to put any money into it. Allpay, and other systems like it, are temporary, short term solutions. Once a reall mobile payment system is in place, and succeeds, they will disappear from the general market. This could be the one, being backed by all three major credit card companies.
melgross
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melgross,
User Rank: Ninja
9/1/2014 | 11:19:50 AM
Re: Umm
Perhaps if you put some thought into this rather that trying to be a platform for your anti Apple bias, you would understand it. Apple has the most experience with micro payments, something that been plaguing the payments industry. They have over 800 million credit cards used with iTunes, which includes the AppStore and their retail ARM. Amazon has less than 200 million, and no credit card company has as many.All three major credit card companies have signed on. PayPal has attempted to have Apple use them. Apple users buy more products through their phones and tablets than anyone using rival systems. Apple will sell over 200 million phones during 2015, and substantially more than that during 2016. Unlike with Android, all of those will have this system available. Retailers have been reluctant to spend thousands for NFC terminals, but are expected to do so once Apple has a system in place. If it's possible, for the first time, one may be able to use their phone for payment for transportation systems using NFC. There are a lot of reasons why this could be successful. And you would see that if you opened your eyes to reality, rather than just kept them squeezed shut, hoping Apple will fail, and your favorite company will succeed.
Li Tan
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Li Tan,
User Rank: Ninja
9/1/2014 | 10:37:51 AM
Re: Umm
Mobile payment is not someting new. I have installed Alipay App on my mobile phone for quite long time and it's very convenient. But I share the same concern with you as well. That's why I will never put big amount of money in my Alipay account.
BillB031
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BillB031,
User Rank: Strategist
9/1/2014 | 8:01:16 AM
Re: question
@mak63.... Probably not many, being this is nothing new, and android phones have had NFC for quite some time.  (Google wallet works great)... Adoption has been slow, since it is poorly understood by the general public.

Maybe Apple can mass market it successfully.  Google hasn't marketed it period.
RobertA768
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RobertA768,
User Rank: Apprentice
9/1/2014 | 3:01:57 AM
Umm
I don't really understand how this is revolutionary marketing for the iPhone 6, I never had a hard time using PayPal on my phone up until now, just makes me think Apple users are the most brain dead consumers out there that will buy anything just because it has an apple on it. I can see this being a bad thing, your phone gets stolen, hacked and then all your money is gone, I like the old methods because they haven't failed me yet, with how easily mobile technology can be manipulated, I would stay away from this one, look at the BitCoin thefts, same thing, except with your real money.
mak63
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mak63,
User Rank: Ninja
8/31/2014 | 11:56:30 PM
question
There's no denying that NFC and mobile payments are certainly a great feature. I was wondering, how many will switch to an iPhone 6 just because of it?

Perhaps it's a good idea to make a poll for it.
jgherbert
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jgherbert,
User Rank: Ninja
8/31/2014 | 11:55:18 PM
Re: Wait, What?
@pcharles09> Well I'll say this - NFC in addition to the iPhone fingerprint sensor could be a powerful combination for secure payments...
shakeeb
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shakeeb,
User Rank: Black Belt
8/31/2014 | 11:27:38 PM
Re: Wait, What?
@pcharles09 – Do you think Apple would be successful this time? It's not an easy challenge to get users onboard. 
pcharles09
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pcharles09,
User Rank: Ninja
8/31/2014 | 10:59:55 PM
Re: Wait, What?
@jgherbert,

If anyone's going to open the door for the big time action, it'll be Apple. No better way to make people think they need something they don't... let Apple introduce it as ground-breaking.
shakeeb
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shakeeb,
User Rank: Black Belt
8/31/2014 | 3:36:30 PM
Re: Fanbois
@jgherbert – Ohh I am sorry to hear you had bad experience with Paypal. Currently I do all my Ebay transactions with PayPal and everything works smooth for me (maybe I haven't seen the bad side of it yet) 
<<   <   Page 2 / 7   >   >>
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