"operator-led NFC payments system"
No. Just no. Operators are among the least trusted actors of the Internet economy. People would prefer anything rather than a payment system they control.
Weve, the bonk-tastic joint venture between EE, O2 and Vodafone to “create and accelerate the development of mobile marketing and wallet services in the UK”, has abandoned plans to launch a digital wallet. This follow on the heels of having lost £25m, on revenues of £13m in its first year, doing the mobile marketing stuff – as …
I'll stick with my bank and their NFC solution. Why put another middleman in there at all?
If Maestro and Visa can get their NFC from cards onto smartphones as well, it would be a better alternative than either operators or a single smartphone manufacturer...
Apple finally join the party only to morph into an MS-style 'embrace-extinguish' party-pooper. It is a real shame that NFC never really got going but I guess the mobile world is almost evolving too fast for it's own good.
Maybe in 30 years or so when it stabilises and the whole financial world uses the Cayman Conch shell as it's currency we could have another crack at this.
Why do they have to panic and drop everything just because a new phone does something similar? The marketshare of this phone is currently tiny and will always remain small compared to Android.
Couldn't the operators set up a similar NFC pay-by-bonk system for Android with non-fingerprint driven authentication via an app? They could also charge 0.15% or thereabouts. Can't see what the problem is.
What i want to know (if a little off topic) is will the NFC in the new iPhones do anything other than the iPay stuff?
Useful things like tap to pair Bluetooth speakers, use of RFID tags, that sort of thing,
As far as i can tell, nothing of that sort has been mentioned, and it wouldn't surprise me if it was iPay only, but that would be a bit like including a Bluetooth stack and limiting it to hands free kits only.
Which is why I would have nothing to do with anyone who doesn't simply offer me a network pipe that I can use from my device to the Internet. I can then choose what to run on that device (in my case just a browser -- I've no idea about these 'app' things of which people speak) and I can get on with my life.
If I want to buy something I use my credit card via a web page on the browser. And I do this through the cheapest Internet pipe I can find.
An Internet pipe please -- and you can fight amongst yourselves about price, thus making it cheaper for me. I don't want any 'value add' services (aka shite).
I want to spend my money where I want -- not be forced to give chunks of it to a fucking greedy mobile operator.
It's not about iPhone vs. Android, it's about iPhone vs. anything else. It only supports a limited number of profiles - HFP handsfree, HSP headset, A2DP audio streaming, AVRCP remote control, PAN tethering, SPP serial which is no good when I'm e.g. trying to send files or vCards via Bluetooth.
If we compare that with a Symbian s60r5 phone from 2010, it supports A2DP, AVRCP, BIP, DUN, FTP, GAP, GAVDP, GOEP, HFP, HID, HSP, OPP, PBAP, SAP, SDP, SPP.
Or the Xperia Z1 which is an Android phone supports a similar set (see P10).
You could almost say the iPhone's Bluetooth is already low energy, it hardly interoperates with anything else. Not even, funnily enough, a Mac.
Look at the iPhone abysmal bluetooth profile support compared to Android, and you have your answer to what NFC on iPhone will support. ApplePay, that is all,
That's all that Apple can make revenue from. There is no reason for them to add other features, if they can't monetize it.
"Useful things like tap to pair Bluetooth speakers"
No need, Bluetooth 4.1 includes tap to pair and doesn't require NFC to do so. Apple have the hardware in iPhone 4S and above to achieve this and will probably update iOS to allow it as soon as the standard is complete later in the year.
NFC is for Apple Pay only.
Apple wants you to use Bluetooth Low Energy (BT 4.0 Smart) for all the use cases you describe. You can pair your phone with your AppleTV that way, for instance. They probably put in NFC under duress as that was the only way to interoperate with payment terminals already out there, which support NFC but not BLE.
However, until the banks, retailers etc show that they have actually learned something about security with the systems that are already in place it will be a very cold day in hell before I touch NFC/phone-based payments with the thin end of a very long barge-pole. Oh and no, I do not care if that makes me seem like a Luddite.
"But what Apple will do except skim the cream????"
Apple wrote the software stack, spent years researching how people want to use their phone to pay, designed the hardware and brought to market a working solution where many, many others have failed. They will also do the ongoing support of the system and possibly reduce the number of cards the credit card companies need to issue, thereby saving them some money.
The banks on the other hand simply change two lines in a database...
Depends what you're comparing to - Credit cards charge around 3%*, but as others have mentioned, there are advantages to the user such as fraud insurance. Banks currently charge a lot less for debit card transactions, but I don't know if that's comparable to 0.15% (anyone know??).
Cash transactions also have a cost - business expense to handle cash with banks, and added security requirements. Again, I'm not sure about the extent of that, but if I recall correctly I read somewhere that cash handling costs for businesses heavily exceed debit card transaction costs.
The real question here is, are banks also charging something over and above the 0.15% that Apple takes? Or is Apple paying them for access to their systems from it's 0.15% cut?
* Technically the charge is to the vendor, but when all vendors are accepting credit cards for such a long period of time it's clear that this is factored into the rice of all goods and services that CAN be paid for by credit card even when they are not. And others such as 'cheap' airlines explicitly pass that charge on to consumers, so I'm only looking at the amount charged.
Before you reach for the "what about the nude celeb gate"...
Apple is using the new "EMV" standard that sends a virtual credit card number instead of the real one, so the retailer will no longer have the real credit card number. Thus an exploit of the retailer's systems will no longer be an issue. This incurs a lot of cost from consumers calling in to dispute charges, having to issue new cards to millions of people, dealing with retailers to recover costs of fraudulent charges, etc.
The banks will probably save that 0.15% Apple is taking in the long run - if not specifically from Apple Pay, from Apple Pay helping set the new standard for how banks want NFC transactions to be completed. All the current NFC efforts (in the US at least) will be binned in the coming months, as banks won't play ball except with those who work like Apple Pay does.
Apple does not store the credit card numbers used for Apple Pay on their systems at all (they must store the card used for iTunes, but not the new ones that users may add) so even if they were compromised it wouldn't hurt anything. The card numbers on your phone are stored in the "secure element", which is a special area of the chip that is only accessible via the OS, not by apps. Absent a complete and total ring 0 p0wning of iOS, the actual card numbers won't be compromised on the phones either.
It isn't perfect, nothing is, but it is a far more secure implementation than Google Wallet or any of the carrier NFC schemes. That's why the banks are willing to pay Apple 0.15%. Apple was willing to work with them to do it how THE BANKS wanted, not with an eye towards data mining the users like Google wants or taking the full 2% markup like the carriers wanted.
Certainly here in the UK, amongst all my friends and acquaintances, I have found little or no demand for NFC payment capability.
It seems rather like 3DTV - hyped and drooled over by 'analysts', but in reality it's a technology looking for a demand.
Of course, your friends and acquaintances might feel differently...
> It seems rather like 3DTV - hyped and drooled over by 'analysts', but in reality it's a technology looking for a demand.
I never have understood why the manufacturers are trying their damnest to feck up a simple (and working) experience where you press a button and the thing displays a picture. Killing off the best display technology we had for a reasonable price in process (yeah, I'm a plasma fan). If I want to browse internet, watch porn or catch-up I will use my laptop, my tablet and my cable providers perfectly adequate box (thank God they haven't tried to put a Pentium 4 so they could offer 'premium services' in these boxes yet).
These things need to be run by banks, not by mobile operators, and not by equipment manufacturers.
It's not that we trust banks any more than we trust the others, just that the banks already have our identities and our money and we're not going to be losing any more privacy or suffering any more risk by using a payment system they operate.
I do think a single bonk should not be regarded as sufficient authorisation to make a payment, though, even for trivial amounts. I'd like to see a PIN or a biometric required as a secon factor in all cases. Anything less will only encourage misuse.
Well, Apple Pay doesn't (as far as we know so far) just require a single bonk - it needs for you to hold your iPhone to the reader while you pass Touch ID verification.
I'd argue that is probably as secure as Chip-and-PIN, which most everyone is happy with (at least compared to swipe/sign).
I add the "as far as we know" caveat because things may change with the Apple Watch. Perhaps with that, you can bonk with the watch and have your finger on the Touch ID sensor on your phone in your pocket, or perhaps you pre-authorise the Watch with a Touch ID verification when you put it on (remember - the watch monitors all the time, so it knows when you take it off, and locks itself and presumably won't do Apple Pay while off your wrist or until you verify with Touch ID at least once per "wrist session").
Anyhow, the short version is that a biometric is required for each transaction with Apple Pay as we know it now.
I think it's needed someone independent of the banks & mobile operators to focus their thoughts. They were too interested in protecting their own turf rather than providing a service that the person on the street wanted.
Apple (for better or worse) have the muscle to say to the banks & operators: This is how it's going to be done. (And the operators seem to have lost)
All we can hope for now, is that the specs for this are opened up and other people can implement it.
If Apple Pay proves to be a big success, which I suspect it will, my guess is that other mobile devices will be able to do the same thing with the same kit. Why? Well, it seems that Apple Pay will be making use of an existing tokenising technology devised by the payment processing industry, and there's no good reason why other parties can't get involved in principle.
The big card issuers / payment processors trust Apple's implementation of fingerprint authorisation and cryptogram production (for a variety of reasons, including the use of a secure element outside of OS space). As I see it, the likes of Samsung, for example, could devise their own similar capability and form agreements with the banks in order to use the same terminal equipment.
I don't see a technical barrier, other than the manufacturer's ability to convince the banks that it's secure. As for any legal barriers (e.g. exclusivity by contract), I don't know.
I just don't. I'm fed up with more and more middle men taking a cut and in the long run, this is only going to push up the prices I'm paying for my everyday goods.
People who use cash are effectively still going to be subsidising the people who use credit cards and all the rest of it.
I can see the day where the services that charge you an extra 1.5% for paying by credit card, over the phone, also spread to the high street in a way to encourage shoppers back in to stores and finding ways to cut shops operating costs ... but even then banks charge businesses for putting cash and cheques in to business accounts. The whole thing is a bloody mess if you ask me. We need another way of going forward because financial houses are bleeding us dry.
What will people give me for these here two chickens and a goat? .. don't laugh, I believe even the tax man would be after the eggs on a barter transaction.
You do realise that there are costs involved in cash transactions as well? Banks charge businesses to deposit and withdraw cash. The only way around it is if the shop owner uses some of those takings to pay their staff in cash. And you can imagine how common that is these days. Other wise it gets deposited in the bank and they charge for it. They charge to provide card services. They've got retailers coming and going! The end consumer will always be paying for those services in the long run
Cash is expensive; businesses have to pay for cash to be transported, they have to pay for insurance based on the amount of cash they may be holding, they have to pay banks to count it etc.
So the cost advantage of using cash versus cards is actually small, or nil, or a disadvantage.
Cards have some risk to businesses, through fraud, but better than having a gun shoved in your face.
Cards also have advantages to consumers as well as businesses, they're convenient and widely accepted and if you inform your bank promptly then even losing them or having them stolen doesn't cost you anything.
I'm not convinced about NFC payments though (via card or mobile) how is this safer than Chip and PIN?
I'm not convinced about NFC payments though (via card or mobile) how is this safer than Chip and PIN?
NFC payments are not safer than EMV (known in Britain as "chip and pin"). Cards use basically the same messaging protocol over the wires and over radio. NFC is equally safe, but more convenient.
"The mobile payments world has hailed Apple Pay as the start of the mobile payments revolution, something which happens about as often as Voyager 1 “leaves the solar system”, but it could be the death of the technology. Apple Pay is (surprise!) an Apple-only system and doesn’t offer any way in for the operators.
On the NFC side, Apple Pay is standard EMV over NFC, like the bank-issued contactless cards. And like Google Wallet. If proliferation of Apple Pay makes the merchants rise their collective back-side from the chair and upgrade POS terminals, that will be a boost for all other NFC payment systems.
I'm far more interested in if this will have any impact on the services Zapp are supposed to be bringing to market.
For those unaware they are working with most major banks to bring contactless payment support into the banks own mobile apps, thereby allowing you to make contactless payments direct from your current account rather than having to top up a third party wallet.
For me this will be the most useful implementation of mobile NFC payment.
Apple's contactless payment service also works direct from your current account rather than having to top up a third-party wallet. Assuming that contactless is contactless is contactless, I would think Apple's push will help Zapp. Once a vocal 10% or whatever it is now of phone owners can do something, such other latent demand as existed will be realised.
Unlike the dopey first generation RFC cards, there's no 'bonking' with Pay iOS Devices. You put the device in proximity to the RF field and push a button on the device. All done. On the iPhone you push the fingerprint sensor. On the Watch, if you've entered your PIN, you press on the watch face.
It will be a happy day when the cruddy, insecure first generation of RFC chips is dead and gone.
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