I ran across an interesting article this morning in Mobile Payments Today that makes a pertinent point about the Apple Pay system versus other, similar payment processing mechanisms. Apple’s approach, which includes both a hardware and a software element, takes the so-called digital out of the wallet, and really creates a cardless system of payments (albeit after the initial card is loaded into the phone); their system makes the device the key element, instead of the card data (Apple is using tokenization at the device level). The only problem with that was brought to light last week when TechTimes and other news outlets reported that a restored iPhone 6/6+ would not load cards into Apple Pay following the restore.
Google had many problems initially with its Wallet launch – most of which (in my opinion) centered around the fact that they didn’t realize what they had in Android and therefore gave away too many things to the carriers to get their phones into the retail lineup. The ISIS/Softcard debacle (that ongoing useless mess of carrier owned digital payment via SIM card) cost Google a lot of time and digital real estate, and left them on the hind foot perpetually. Apple, realizing the timing would never be more right, decided to shelve the Healthbook app temporarily and make a payments play while the entire US merchant transaction processing system was in flux, due mostly to the required adoption of EMV cards by October of this year.
Apple’s dominance in the hardware markets’ where they operate is insane. I’m typing this post on a MacBook Pro (retina edition), with my old Macbook (used for checking migration updates), an iPhone 5c, and an iPad Air all within arms reach. No one – carrier, retailer, you name it, messes with the Apple hardware. This is not Microsoft, Android, Chrome, or Samsung, and Apple does not have a booth or sponsor a party or anything else at CES (starting today) but yet they will be one of the most dominant companies (again) at CES.
Of course my HTC M8 is my daily phone; I just wish that Google would get on board with the realization that designing things that look good and function well from a graphics/UX standpoint is going to be just as important for making their wallet product popular as anything else they might be doing.
We don’t (and merchants really should not) care, at this early stage, what wallet is going to shake out to be the dominant species — it’s too early in the game to pick sides, and the smart money is on making in-store (or mobile) purchasing experiences work equally well with anyone who has a decent, secure product and enough market share to make it worth integrating. Then the cards can fall as they may, and smart retailers will be ready (and already accepting) the currency of the realm without too much extra effort.