Apple Pay promotion

Why Apple Pay Will Win

Apple Pay promotion

When Apple announced Apple Pay as part of the iPhone 6 and 6 Plus, it failed to tell consumers something it clearly knew: Many retailers would prevent iPhone owners from using Apple Pay for quick and simple payments. For the time being, a lot of retailers, especially big ones such as Walmart and Best Buy, will reject Apple Pay. But in the end, Apple is likely to win.

Apple is, in fact, a player caught in the middle of a massive fight over new technology between banks and some big retailers. These retailers have invested heavily in Merchant Customer Exchange, or MCX, and a consumer technology called CurrentC. Banks, which have invested a lot of money over the years in credit card technology, seem OK to let Apple (and the so far not terribly successful Google Wallet) do the work.

The biggest advantage for MCX is a promise to support “new and old” iPhones and Androids, whereas Apple Pay is limited to the iPhone 6 and 6 Plus. But Apple has a number of advantages of its own. The most important is Apple Pay is out there working now and will run through retailers’  existing NFC readers. CurrentC requires the phone to give information through a QR code displayed on the phone screen. It’s not yet known when CurrentC will be available or how well it will work.

So far, Apple Pay seems to be reasonably secure. CurrentC has just been embarrassed by the theft of email addresses from subscribers. It’s not a serious loss and apparently most of the names belong to test accounts, not real customers. But delivering security accounts is an important CurrentC promise and this cannot help it.

The banks and credit card companies, who do not want to see retailers take control of the payment mechanism, were actually smart to trust Apple with the design. In addition to Apple’s security and software design strengths, the arrangement doesn’t leave a place for a lot of fighting over the details, things that seem to be both complicating and slowing the development of CurrentC.

When Apple first launched the iPhone 6, customers discovered retailers with any NFC processor were able to accept Apple Pay transaction. MCX demanded CurrentC participants, including CVS and Rite Aid retailers, cut off Apple Pay, which they promptly did. MCX has made it clear it will enforce contracts prohibiting use of competing payment services on its subscribers, and it’s going to be messy.

The big question for Apple is whether it fundamentally sees Apple Pay as a way to serve iPhone sales or a way to to enhance its role  as the manager of sales technology. The latter would require Apple to supply software to manufacturers such as Samsung or to Android and Windows — and neither Samsung nor Android are on good terms with Apple. Still, it provides a new and potentially lucrative market for Apple.

Published by

Steve Wildstrom

Steve Wildstrom is veteran technology reporter, writer, and analyst based in the Washington, D.C. area. He created and wrote BusinessWeek’s Technology & You column for 15 years. Since leaving BusinessWeek in the fall of 2009, he has written his own blog, Wildstrom on Tech and has contributed to corporate blogs, including those of Cisco and AMD and also consults for major technology companies.

53 thoughts on “Why Apple Pay Will Win”

  1. Steve,

    Great article. Just one typo, In the 3rd paragraph you say “MFC readers” instead of “NFC readers”

    Now my take on the siltation:

    This is a fight that the retailers will not win. No matter how much they want to “screw over Visa” as the architect of this system from Wall Mart has said. Sure, I know that the retailers hate the interchange and other fees that they have to pay to take credit cards and have sued to have those fees lowered to no avail. This MCX/CurrentC system is not going to do that. All it is going to do is delay the inevitable adoption of NFC contactless payment in the USA. With all of the data breaches over the last couple of years from the major retailers (many of witch are part of this MCX cartel) they are now going to ask us consumers to trust them with DIRECT access to our checking accounts, Social Security Numbers and drivers license numbers all to be stored on their “secure” server.

    As you have correctly noted in the article the server has already been hacked and the system is not live yet. Just wait until it does go live and you will see a real reason for the hackers to go after it as there will be lots of juicy information there for them to exploit. Not only that but what happens when there is a breach. Who do we call to get our money back in our checking accounts after they have been wiped out? How long will it take to get resolved? What sorts of fraud protections will we have? From the reading I am seeing it will be all pushed down to the consumer. At least with Credit Cards when they are compromised we are not liable for the charges and there is a financial firewall between our Credit Cards and our bank accounts. So while it is an inconvenience to get a new Credit Card issued it is way less risky.

    To be clear, I do understand the pressures many retailers are under and how every dollar does count but this is a fight between the credit card companies and the retailers. If they do not like the fees then they may want to try to stop taking credit cards and see how that works for their bottom line. I bet they would find out real quick that many people going in to their stores do not have the money on the spot to pay full price for all of the goods they are selling. So the benefits of taking credit cards outweigh the fees. If they want to save money they could try turning off the air conditioning during the summer and see how that works. I bet they would see a drop in sales as well. The point is that there are some costs for doing business that are just not negotiable.

    The way I see this playing out is already happening. You have iPhone 6/6+ and Android Google Wallet users boycotting the retailers who are part of the MCX cartel. It is a weird world where you get both Apple and Google fans united together. This shows how bad of a deal this is. Not only is this happening but I bet you will see the CurrentC app pulled from at least Apple’s app store and also hopefully the Google Play store as well. Both vendors have no obligation to host that app in their store. If the MCX has a problem with it they can take it up with the feds.

    Another possibility is that the credit card companies decide to show their power by slowing down or stopping authorizing credit card transactions from the MCX cartel. They could claim “server upgrades” again. The MCX cartel looses. Even if it is for a short time. Yes I am sure there will be lawsuits over this but I suspect we are going to see this brought to court or there to be new laws on the books over this fight as it is of national importance.

    1. Brian,

      Nice comment, but…

      Leave the picayune editing (MFC) till the end. It’s not good to start with a distraction.

      “Now my take on the siltation:”

    2. I fail to understand why anyone would allow direct access to their checking accounts. With a credit card, I have Visa, MC, Amex or whomever acting as a firewall between charges to my account and the payment of said charges. I would much rather have Visa, etc. as the 800lb gorilla on my side when it comes to disputing charges with vendors. That, plus the anonymity of Apple Pay, make it a hands-down winner as far as I’m concerned.

      Needless to say, I don’t use debit cards for the same reason.

      1. This is one area I think MCX could make a difference for some customers. Not everyone (as credit happy as some banks seem to be) can get a credit card.


        1. But everyone and anyone can get a debit card with a Visa or MasterCard logo so MCX doesn’t offer any advantages.

          In fact it’s a million times more intrusive than Apple Pay. I encourage everyone to read through CurrentC’s privacy policy and do your best not to puke on your computer screen ’cause the policies will make you sick to your stomach.

          The privacy policy uses the term “third-party” so much I thought it was the name of the product/company. They share SO much information with third-party vendors and merchants it’s almost sickening.

          The CurrentC app even requests health data. Why in the world would I want to give Wendy’s access to my health information?

          1. CurrentC privacy may be bad (and I agree that it is, but what do I know?), but there are already cases where people don’t seem to care, such as with Google services and Facebook. It is currently not even implemented well with a QR code. But that doesn’t mean it can’t find a use, especially with loyalty rewards and incentives.

            The market may be small but there are banks with restrictions on debit cards as well. Unless you travel in those circles, you probably don’t know the people who bank there.

            What’s crazy is for MCX to think that this is a viable alternative to a credit card. I guess they think just because it is on a smartphone that makes a difference. CurrentC is not more convenient than a credit card. People who use Apple Pay are probably not interested in using CurrentC for all the reasons that make it a bad idea (which, thanks to their recent stunt, even MORE people now know). If they didn’t have Apple Pay, they would probably just use their credit cards anyway. In which case, how does CurrentC make sense for companies with store branded credit cards?

            If CurrentC is released in any resemblance to what we know about it now, it will fail. But then, how much does it have to work to succeed? Even if less than 1% of their customers use CurrentC, that is more than they had before.


          2. “The market may be small but there are banks with restrictions on debit cards as well. Unless you travel in those circles, you probably don’t know the people who bank there.”

            Here’s what I do know: anyone that can afford an iPhone 6 has access to a debit and/or credit card. So in that regard anyone that wants to use Apple Pay has the necessary resources to use it.

            I do, however, agree that merchants must be off their rocker to believe that people will opt for a direct bank account draft over a credit card, many with special offers like cash back rewards, road side assistance, rental car advantages, loss-of-income coverage, identity protection, sky miles, concierge service, etc.

            In merchants’ haste to rid themselves of credit card fees they’re more likely to rid themselves of customers first.

          3. “Here’s what I do know: anyone that can afford an iPhone 6 has access to a debit and/or credit card.”

            That’s why I think it is unfortunate that most everyone seems to be thinking of this as one loses and the other one wins (including the retailers). There is certainly room for multiple solutions (just like there are multiple credit card companies) that serve different markets and don’t add much cost, at least no more than already currently in use. That doesn’t mean the MDX app is great.


          4. never let the bleedin’ obvious get in the way of greed. These businesses can’t be that marginal that this seems like a good idea can they? If they are, we’re in much bigger trouble than I feared.

          5. I can’t take credit for this comment but merchants heard “no credit card fees” and grabbed their ballpoints without thinking twice.

            I’m still largely perplexed by CVS and Rite-Aid’s decision to disable their NFC readers. In Wal-Mart and Best Buy’s case they never had NFC readers so they get a pass but to willingly deny customers the ability to pay in an acceptable format boggles the mind.

            I’m trying to figure out what the meeting looked like:

            “Mr. CEO, people are buying things in our stores using the NFC readers that’ve been operational for a couple years!! They’re paying for prescriptions, candy bars, gift cards, and impulse items at the register.

            Actually, we’ve seen a slight uptick in traffic ever since Apple Pay was released the other day and I’d like to think that iPhone users will tell their other iPhone owning friends to come by the store even if it’s just to try it out. And there’s a chance they’ll come back because they know we’re a store that accepts Apple Pay. What should we do sir?!”

            “Shut those NFC readers down!!”

            “Outstanding, sir!! That’s why they pay you the big bucks! A bonus is that we’ll be cutting off Google Wallet users too!! We’ll get right on it sir…oh by the way, when will that other system, CurrentC, be available?”

            “No idea but we can’t have people with iPhones running around our stores trying to buy stuff! It’s uncouth. Shut those terminals down. With any luck they’ll boycott the store and we’ll be rid of those despicable iPhone users and all their disposable income.”

            “Again, brilliant sir. Brilliant!”

          6. As I understand it, it is reportedly because of contractual obligations to MDX and not allowing competitor contactless formats. That is not to say it isn’t a convenient excuse, but it can still be a legitimate a reason.


          7. “…it is reportedly because of contractual obligations to [MCX] and not allowing competitor contactless formats.”

            This isn’t entirely accurate because Google Wallet has been in place since 2011 and stores like Rite-Aid and CVS were accepting this payment method until only recently once Apple Pay made its debut.

            Because Google Wallet has been largely unsuccessful MCX didn’t see it as a threat (understandably so since both Verizon and AT&T, two of the nations largest carriers, did everything in their power to block it from being used in favor of their own largely unsuccessful mobile payment systems) they didn’t see a need to force any member of the MCX and CurrentC to disable NFC-enabled payment devices.

            MCX clearly sees the value and power of Apple coming into the mobile payment space and their knee-jerk reaction to the disabling of NFC terminals is a clear sign that CurrentC is a wholeheartedly inferior and infantile system by comparison.

            Also consider that Meijer, a mid-west grocery store chain, decided NOT to disable their NFC readers claiming they’ve been accepting contactless payments for several years and didn’t see any reason to cut their forward-thinking customers off by the knees by disabling a currently working and stable system in favor of a system (CurrentC) that’s been on the white board since 2012 and won’t be ready until “some time” in 2015.

            I’m sure the hack didn’t help matters.

          8. Makes Google look like your best friend. Too much information is never enough. It’s a virtual mugging where you find the mugger.

        2. Thanks to the world famous capitalist system, those people just don’t count, so are invisible, till they shoot people or blow stuff up.

    3. MCX might have a chance if they actually wanted to help consumers by providing a safer more convenient payment method that might even save them some costs, but all they want is to screw their customers and provide a bizarrely more insecure and customer aggressive experience. They have obviously learned nothing and appear to having a psychotic break with reality and the blindingly obvious.
      It’s only a matter of time before their house of cards collapses, but it will cause great pain to their customers and will further entrench their enemies (credit card providers).
      I’m sure apple and the banks can’t believe their luck, even if it delays adoption of the new systems slightly, it’s likely to reinforce it the long run.

      1. The problem is that MCX can not provide a safer and more convenient payment method than what Apple is doing with Apple Pay or even Google with Google Wallet. The key to why Apple Pay is already a hit with the 1st 1 million users is Apple doing all the right things by pre-setting up the deals with the existing credit card companies, banks and a number of forward looking retailers. By Apple baking Apple Pay right in to iOS and the iPhone 6/6+ hardware Apple has the advantage to make it the most easy and secure payment system in the world.

        There is no way a 3rd party can do that today. Maybe in a later version of iOS like iOS 9 when Apple opens up the NFC radio to 3rd party payment systems but not now. I do think that Apple will eventually allow others to come in with their own payment solutions as well but Apple wants to give their own Apple Pay system a head start and not allow 3rd party’s like PayPal to have the same advantages yet. I assume you read that Apple was going to work with PayPal and have them be a part of Apple Pay but when they found out that PayPal was in talks with Samsung they smartly kicked them to the curb.

        From everything I am reading it does look like all MCX wants to do is screw the credit card companies out of their fees and get better tracking data on their customers. To do this they are willing to risk millions of customers checking accounts, Social Security and Drivers License numbers in the process.

        You are correct that it is only a matter of time before their house of cards collapses under its own weight. All it is going to take is one hack of the live system and that will be it. The FDIC/DOJ/FTC will have it shut down so fast it will make their heads spin.

        There is no question that Apple and the banks have timed the launch of Apple Pay brilliantly. It is right in the 4th quarter where most of these retailers are really looking to make their money and it gives the merchants that do take Apple Pay and other contactless payment systems a great competitive edge. I am loving how Walgreens is getting the world out that they are happy to take Apple Pay while their 2 biggest rivals are not.

        1. I million CARDS. Not 1 million people. Apple talked about having a million cards of which many people signed up multiple cards. So it’s not all that many. I myself signed up 3 cards. Many friends did the same. Now do the math on how many people are using it. Not 1 million.

  2. Funny how far many more Android users are impacted by this, but most of the screaming is coming from Apple users.
    Every Android flagship phone of the past two years (at least) has had NFC.

    1. While that is technically true that many more Android users are impacted by this. Most users on Android did not setup and use Google Wallet. Now part of the problem is that as I understand it with Google Wallet you have to pay extra to use it. Also Google Wallet was blocked by Verizon for a while and you have most users of Android that did not know it was even possible.

      You are also correct that most users (even iPhone users) do not yet have an iPhone 6/6+ Of course part of the reason why is that there are supply issues for now. Of course those issues will be resolved soon but for now even for the die hard fans they are waiting on getting an iPhone 6/6+.

      In regards to purchasing an iPad or even iPhone with cash in an Apple Store. I can see why they would do this around launch times when supplies are limited to keep the gray market at bay. They want to make sure the actual owners are getting 1st dibs on the iPhone and iPads.

      Not accepting NFC now I do think is the bigger story because it relates to some real security and liability issues that could impact millions of people if they end up foolshly trusting the MCX/CurrentC cartel.

      1. It’s not clear how many Android _users_ are affected by this. Certainly a larger number of Android handsets are affected. But it seems so few Android users were using the payment system that no one cared. Apple implements something and it matters because it _will_ be used. This is why everyone has wanted and been waiting for Apple to enter the NFC circuit. It is the only way NFC would gain significance.

        Unfair to the rest of the industry who have been working hard to make something of NFC? Sure. Typical Apple procedure of not actually creating a _new_ market, but redefining it once they participate? Yes. But only Apple users are screaming? That’s not what I’ve read. But then there are so few Android users using NFC, maybe it just doesn’t matter.


        1. The reason we did not hear that much from the Android camp about this is because even though Google Wallet has existed for a while and many Android handsets do have NFC radios in them most people did not know it was possible. All I have seen in the marketing from Samsung and others as a use case for NFC was to share pictures by tapping phones together. Also, let’s not forget that with Google Wallet the users have to pay extra to use it whereas on Apple Pay those charges are taken care of on the back end and your price at the register is the same if you use a credit card or Apple Pay.

          So of course you are going to see lower adoption rates on Android than on Apple. Also as you have said correctly, Apple is unique as the way they roll out a product they get all the parts working together 1st and then market the crap out of it. So when their users go to use it “it just works” as the saying goes. This is in direct contrast to the way that Android and even Windows operate as you as a user is expected to put all the pieces together and hope it all works well. Also for many things that are not included the user is expected to bear the costs to get them going.

          As for who is complaining now, I would say that you have the hard core geeks on Android and it is more normal people now on Apple. This is one of those odd cases where both Apple and Android users needs are aligned against the common enemy MCX. That should tell anyone who is watching from the outside how bad MCX’s CurrentCs system is. It will also be what brings the whole MCX cartel to an end.

          1. I live in a major US metropolitan area. There is a huge scarcity of NFC terminals. Even now. Why would there be familiarity, and why would it catch on? This is regardless of the platform.

          2. We’ve had PayWave (nfc) terminals so long here that the chip in my card failed months ago and needed replacement. I can’t believe how far behind the U.S. is in some areas, especially in Internet providers and coverage. Talk about Balkanised. When visiting the States last year, I was forced to go with T-mobile after AT&T couldn’t get their sim working in my ipad. I thought our secondary networks were crap (they are) but T-Mobile was almost worse than useless with huge holes even in your major cities, never mind outside them, but AT&T was almost always there, even though I couldn’t use it.

  3. The big question for Apple is whether it fundamentally sees Apple Pay as a way to serve iPhone sales or a way to to enhance its role as the manager of sales technology.

    My understanding is that Apple Pay is based on a tokenization technology that was developed mainly by credit card companies and banks. Although Apple was probably heavily involved, the payment scheme itself is not something that Apple owns.

    I assume that Google, Microsoft, and maybe even Samsung or even Xiaomi, Alibaba could implement it. Whether the experience would be as good as Apple Pay of course may depend on factors like hardware-integration, etc.

      1. To be more correct he could have titled it: Why NFC Contactless Payments Will Win but most people have no idea what that is. So calling it Apple Pay makes more sense. But you are correct!

        1. I think rather recently, Apple executives have mentioned that Apple Pay may be more significant for online payments (that do not use NFC) than for payment via NFC. Also consider that Apple Pay is available in the new iPads which do not have NFC (at least officially).

          NFC-enabled payments are only a subset of Apple Pay.

        1. It still has made little to no impact. It does have potential. I’m glad for all the outcry, because it brings awarwness. In the long run we’ll either use what suits us, or the winner, or neither.

    1. Thats right. Apple is NOT going to provide Apple Pay for Android users. They have their own solution (Google Wallet) that works just fine for them. As for if it will ever be as good as Apple Pay we will have to see but so far it does not look like that is the case as only Apple is able to do what they do. With Android you have many layers to the situation. You have the phone OEM, the cell phone carrier and Google. So getting them all to agree and promote the same things is next to impossible as they all have different goals when it comes to the sale of an Android phone. This is why many Android users may have NFC radios on their phones but either are not aware of it or even if they are they could be blocked from using it because the carrier like Verizon wants to push their own technology or get a cut of the transactions.

      So I see Apple Pay being one of the keys for Apple to sell new iPhone 6/6+’s, Apple Watches and other future devices. Apple has seen the writing on the wall that they have to bake their advantages in to silicon as they can not rely on the courts to back them up. Even though they won the court case against Samsung it was too little, too late.

      1. I suspect that there are a lot of intricacies in payments, and I’m not sure if banks and credit cards will embrace Google Wallet in the way they have Apple Pay. We’ll have to watch.

        Otherwise, I totally agree. Although it’s still a bit early to tell, it could very well be the case that the silicon based advantages that Apple is building may be a much stronger deterrent of Android competition. I’m thinking of what Android 64-bit performance is going to be like.

      2. Why would they need the courts on payments? Is Apple Pay patented? If it is it’s in a very specific, thus limited, way.

        1. No, I do not think that Apple Pay is patented in a way that Android vendors cannot create an Apple Pay-like solution. That would not be in the interest of the banks and credit card companies.

          Instead, what is interesting is that very few Android OEMs have successfully created a good and convenient biometric authentication mechanism in their phones. Samsung’s fingerprint scanner is not very well received in reviews either.

          Also, if you look at 64-bit CPUs in smartphones, they have only just started to come out on Android phones, and performance-wise, although there aren’t many benchmarks yet, they don’t seem to be too competitive against Apple’s chips.

          It appears that Android OEMs are having a bit of trouble replicating Apple’s silicon and hardware.

          This suggests that Android OEMs may struggle to make their payment schemes as convenient as Apple Pay, even without patents owned by Apple. Google may come up with a solution that circumvents the need for biometric sensor hardware without sacrificing convenience, but we don’t have one yet.

          1. While it’s possible another vendor that makes Android phones will develop a biometric reader as competent and reliable as TouchID I don’t see it happening.

            Most vendors have switched to capacitive buttons for the sake of additional screen real estate. You can’t blame them for moving from physical buttons but it does show a lack of vision for what a “traditional” home button can do.

          2. I think it was Google itself that pushed for removing physical buttons so it would be interesting to see if they reverse direction or not.

            Google is of course adding software based (face recognition, etc.) authentication schemes to Android so the question is whether that will be enough to get the banks on board, or whether Android users will still have to use a PIN.

            I personally hate the PIN. At least in Japan where we often use phones in crammed trains, it’s all too easy for a pickpocket to first see you enter your passcode, and then steal your phone.

          3. exactly. I also hate the pin concept, especially for credit/debit cards and the phone, so jumped on board, if I may, with the 5s on launch day after using only the 4 for the previous 3 years (which I also scored on launch day. Who could pass up the new screen and great camera?). I’m always suspicious when banks force new systems on users as they like to transfer responsibility and costs.
            I suppose criminals are less likely to to remove your head than a finger to access your phone, but I think I’ll stick to iPhone fingerprint sensors for the time being.

          4. I don’t know about the situation abroad, but in Japan, people take PIN theft seriously. There were incidents where small cameras were embedded by criminals close to the keypads on ATMs, and this lead to actual theft. Also, Japanese ATMs typically have a “back mirror” so you can see if the person standing behind you is peeking as you enter your PIN. Cashiers at chip & PIN terminals often turn their head away to make it 100% clear that they are not trying to steal your PIN.

            Although Apple Pay may struggle to gain broad acceptance with our proprietary NFC terminals, I’m sure that the Japanese consumers would welcome a PIN-less and secure payment system.

          5. I still don’t trust the “not looking” cashiers as there are “security” cameras everywhere being observed by “security” staff that may or may not be trustworthy or reliable. ATM’s are also a bit of a worry, hence my preference for credit cards, in spite of their issues. Definitely looking forward to apple pay, hopefully with the watch, till they improve the Plus.

  4. Unfortunately this is really a case of one system does not have to lose for the other system to win. The retailers can easily target the MCX system to a loyalty program and/or special offers.

    The problem is that the two-fold goal (cut credit card fees and gather an Amazon level of customer info) of the MCX system is not to help the customer, it is to help the retailer. As one company officer put it “As long as Visa loses”. How does that help the customer? With that attitude, the retailers are the ones who will lose.


    1. Frankly, I’m mischievously daydreaming of writing an App that makes it ‘harder’ to spend money. I know it would be allowed on Android. On iOS, I’m not so sure.

      Look at us, falling all over ourselves on how to make one corporate behemoth richer over another. I’ve seen lot’s of people elsewhere posting that they will only ‘shop Walgreens’ from now on. I like Walgreen’s, but really?! These same people don’t mind being curated though. Perhaps it’s precisely because they don’t mind being curated? Hmmm….

      1. Odd. I thought you were all about choice. Here are people expressing their choice, yet you still want to cut them down.


        1. Yes, they can choose an App to help them curb their spending, or to persuade them to pay cash. No one ever had their identity stolen with cash. I wouldn’t impose it, they can choose.

          Until a month ago, ‘NFC sucked!’. What if it still sucks? What if MCX sucks worse?

          1. It is the MCX cartel that sucks much worse. NFC never was a bad thing but people forget that what Apple users had issues with was that the use case was not there before. Thats the key, it was sold as a gimmick to share photos by bumping phones together. Now that we have a use for it in Apple Pay it makes sense.

          2. All of them. Yes, including you know who.

            Customers are these companies pawns. Sure not rooting for any of them.

          3. Are you dense? NFC has way more capabilities than bumping phones. Have you looked at Bluetooth wireless speakers lately? Almost all of them have NFC built in. There are a ton of things to do with NFC beyond payments and bumping.

  5. “When Apple announced Apple Pay as part of the iPhone 6 and 6 Plus, it failed to tell consumers something it clearly knew: Many retailers would prevent iPhone owners from using Apple Pay for quick and simple payments.”

    Pretty sure you made that up.

    How could Apple foresee the MCX rejecting Apple Pay? Considering Google Wallet’s been around for over 3 years — and uses the same technology that Apple was taking advantage of — there was no reason to suspect merchants would flat out reject Apple Pay. Maybe take a few months to a year to account for and upgrade their pay terminals to NFC readers but I don’t think ANY merchant planned to flat out snub Apple Pay over a competing service.

    No merchant interested in selling things would deny their customers the ability to purchase goods using an acceptable form of payment.

    What I find interesting is that CVS and Rite Aid’s NFC readers have been taking Google Wallet payments for years but suddenly they cut them off when Apple Pay arrives. Why is that? Why isn’t Google a threat to mobile payments but Apple Pay is?

    The answer is obvious but it’s a clear sign that Apple is a threat in the mobile payment space and Google isn’t.

    1. I am not sure if Apple knew it or not, either. I imagine one of two things. If it was knowable pre-Apple Pay launch, it would have been a lack of thoroughness on Apple’s part, which is not a good sign. My guess is #2, even the participants either didn’t know, misunderstood, or forgot about the “no competitor’s” clause and it was MDX who reminded/threatened everyone after Apple Pay started getting traction.

      #3, of course is that Apple knew, but either didn’t care because this is not meant to supplant payment systems for anyone but Apple customers (which every keeps saying is not a majority of people) or, since they are working with the banks, didn’t see it as much more than a variation on credit card payments which the retailers were already accepting.


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