“Apple is again looking to revolutionise an industry with Jobs’ successor Tim Cook revealing this week its entry into the finance sector with Apple Pay,” The Financial Times reports. “Payments, he said in language reminiscent of Jobs’ original comments, is a ‘huge business,’ with $12bn worth of daily transactions in the US alone, restricted to using an ‘antiquated’ card swipe system. The banks, technology companies and retailers that have ‘dreamed of replacing’ the wallet with the smartphone have ‘all failed,’ he declared.”
“Such is the sway of the tech company that JPMorgan, Visa and the other banks and payments networks sent senior executives to Mr Cook’s presentation on Tuesday to pay homage. Bank chief executives fawned about the ‘exceptional customer experience’ and the ‘exciting move,'” The Financial Times reports. “They are also paying hard cash for the privilege of being involved: 15 cents of a $100 purchase will go to the iPhone maker, according to two people familiar with the terms of the agreement, which are not public. That is an unprecedented deal, giving Apple a share of the payments’ economics that rivals such as Google do not get for their services.”
“Banks are willing to lose a slice of revenues in the hope that Apple Pay will become ubiquitous. That would drive up transaction volumes – and therefore overall revenue – and could reduce losses to fraud through its tighter security. MasterCard and Visa now cover the cost of card fraud, but from next year will hold retailers responsible if they do not use the ‘chip and PIN’ technology that is widespread in Europe but nearly unheard of in the US. The new retail terminals often allow both PIN and NFC transactions. That could speed uptake of Apple Pay,” The Financial Times reports. “‘What Apple really announced was the end of the plastic credit card, but not the end of paying by credit,’ says Jason Oxman, chief executive of industry group Electronic Transactions Association… Just as the iPod killed the CD, Apple hopes to see off plastic and paper payments.”
Much more in the full article here.
MacDailyNews Take: Mo’ money, mo’ money, mo’ money! Great news for Apple and AAPL shareholders!
When it comes to Apple Pay, Eddy Cue certainly looks to have done an exemplary job of getting the ink.
The future of Apple TV continues to await the icing of deals (perhaps more for Jimmy Iovine than for Eddy).
Lastly: Google’s going to rue the day they got greedy by deciding to try to work against Apple instead of with them. – MacDailyNews, March 9, 2010
[Thanks to MacDailyNews Readers “Brawndo Drinker” and “Bill” for the heads up.]
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