
Square’s Disruptive New iPad Payments Service Will Replace Cash Registers - acrum
http://techcrunch.com/2011/05/23/squares-disruptive-new-ipad-payments-service-will-replace-cash-registers/
======
cwilson
I'm not sure if many HN users are familiar with TabbedOut (there are quite a
few venues in Austin that support it), but there is definitely some cross-over
here with the Square Case. Specifically if this works in bars.

Essentially you can open and close a tab with a bar whenever you want. Forget
to close your tab and realize you're a mile away from the bar? No problem, you
can close it and add tip from anywhere. Forget your credit card often at bars?
You don't give them a CC in the first place because it's stored in your
TabbedOut account.

It also does nifty things like allow you to split checks via the app at
restaurants, which is super useful.

One of TabbedOut's big accomplishments is they have invested quite a bit of
time/money integrating with point of sale systems which is what allows them to
have such a slick user experience. I'm curious if this is something Square has
done as well.

~~~
pbreit
No. Square has built it's own iPad-based POS software.

~~~
jaxn
With an iPhone client for the customers that interacts with the POS, so it is
definitely a feature they could have.

The iPad POS doesn't appear to be in the app store yet.

~~~
pbreit
<http://itunes.apple.com/app/square/id335393788>

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lionheart
My local coffee shop here in Tempe, AZ switched over to using an iPad with
Square instead of a cash register about a month ago.

As a customer I like it. It's fast and slick. The employees seem to like it
too.

Only one thing: if anybody from Square is reading this look into allowing the
option of a bigger, sturdier card reader. The little on you ship now is flimsy
and doesn't work too well if you use it 500 times a day.

~~~
pkamb
That's what I keep thinking every time I see a picture of the thing. Looks
like it would just rotate in the round headphone jack every time you swiped a
card.

~~~
lionheart
It's actually not that bad. And it looks like its perfect if you're using it
for payments on the move. But if you're not going to be moving the payment
station around you should be able to opt into a bigger and sturdier one.

~~~
jmm
Kickstarter campaign, anyone? (to produce an iPad + Square dongle enclosure)

~~~
brianbreslin
Great idea. If I were even remotely an industrial designer I'd build in a
stand as well

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CodeMage
Every time someone talks about Square, they call their service "disruptive".
Sorry if I'm being dense, but what is it that they're disrupting?

~~~
thinkcomp
Nothing. Square further propagates the status quo (plastic cards). There's no
disruption involved. That's why Visa is an investor.

~~~
roc
It looks more like a trojan horse to me.

If they become the new merchant-interface, there's nothing stopping them from
offering an alternate payment mechanism that doesn't rely on credit or debit
cards.

~~~
jes5199
I'm an engineer at Square, so I can neither confirm or deny such speculation
... but in an interview with Wired, CEO Jack said "People understand credit
cards. They know exactly what to expect from them. They’re used everywhere.
But Square is payment-device agnostic. It doesn’t matter how you pay. Some of
our users accept only cash."
<http://www.wired.com/magazine/2011/05/mf_qadorsey/all/1>

~~~
thinkcomp
Why not accept FaceCash then? The rate is 1.5%, much lower than what you
charge now.

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esmevane
Leena,

[http://www.google.com/search?sourceid=chrome&ie=UTF-8...](http://www.google.com/search?sourceid=chrome&ie=UTF-8&q=leena+rao+disruptive+techcrunch)

As you can see, you have published numerous articles on this company with a
blatant formula to your titling strategy.

If I may offer some constructive criticism, I would recommend that you vary
your language just a bit with the next Square article you post.

Thanks :)

~~~
jmm
Disruptive criticism? :)

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inkaudio
I didn't read anything about square providing hardware to store cash. It can't
replace traditional cash register if the system does not accept cash. There
already more mature Mac based cash registers that it would be competing with.

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holman
Really stoked about this. I wish they had more details on the process, though.

At first exposure, the idea sounds really, really cool. But it sounds like
they're breaking the normal purchase loop. Imagine lunch, for example
(assuming you've already set up your tab, which is a lengthier first-run
experience). You go up to pay, and then... what? TC explains it as:

> So once you press that button within two blocks of the merchant, you’ll be
> able to tell the cashier your name and your card will be charged on the
> merchant’s backend Square register.

So do you pay in advance? Afterwards? (In which case, can I just walk out and
screw the retailer?) Do I as the user set up the bill, or does the merchant
and I have to review it? Does either party have to wait for the other to
confirm something? I've already been at Square retailers that have skipped
Square during times of high customer peaks (opting for cash, which was much
quicker).

These are probably just early questions that will look obvious and boring once
it's all figured out and public, but right now I'm scratching my head a
little.

~~~
puls
When you open a tab, your name just shows up next to the "charge a card"
button. You pay when you normally would. It's not really breaking the normal
purchase loop so much as removing all of the crap from it.

~~~
holman
So you open a tab prior to going to a place, and then the retailer sees all of
the customers with recently-opened tabs?

~~~
puls
Yep.

~~~
holman
Cool, that makes more sense. I'm satiated!

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cssmith
>500,000 Square card readers shipped, 1 million Square transactions in May

So, half a million card readers have been shipped and they've each been used,
on average, twice in this month? That seems really low to me. Do a lot of
merchants get the reader and not use it at all?

~~~
dangrossman
A lot of people asked for a reader simply because it's a neat gadget and it's
free, never intending to use it in a business.

~~~
jamesjyu
Yep. That's exactly the reason I got one.

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kenjackson
What's the innovation here? I mean its great if I already have an iPad at
checkout. But why would I buy a $500 device to sit next to my cash register?
Or if I'm going all credit and debit, there are already services that work
with $250 netbooks. And beyond that you can just lease the little boxes for
like $20/month+some surcharge.

It seems cool for techies, but is it really going to change the game?

UPDATE: Although this seems like more of a win for door to door sales and
maybe mall kiosks.

~~~
roc
> _"What's the innovation here?"_

I think you're getting hung up on the form-factor of the iPad and missing the
novel part: the software.

It not only gives every merchant the advantage of loyalty-card-type data
streams, but gives tools that leverage that data to the customers as well.

Cash register software is notoriously bad. Even the big shops that spend
millions on it. It really wouldn't take much to upend that business.

~~~
kenjackson
If you're looking at just SW, how's it compare to Quickbooks POS?

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baptistepicard
This is another brilliant call from Square. NFC technology is not yet
developed and many problems still exist for the implementation (the iPhone 5
might not have the appropriate chip for example), whereas square seems to make
it easy for both customers and merchants. The only problem I see is that this
square technology is suitable for the US market but I'm not so sure about
Europe.

~~~
iloveponies
NFC's problem is not technology - it's the lack of implementation.

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kellyreid
I run a small retail biz and do a lot of trade shows. Square is the best thing
to happen to my business since finding funding to start it. It's THAT good.

I don't know if it's even on the table, but I agree with the article; there
should be bids out for this company. I'm hoping that Dorsey et al do not sell
it. I could see Visa buying them and doing something destructive -
intentionally or not.

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grandalf
Why is the magnetic stripe reader necessary? Why not just use the camera to
OCR the card itself?

~~~
danilocampos
Because the magnetic stripe contains a security code that's not otherwise
represented on the card. Including that code in the transaction gets you a
better rate, since the physical presence of a card may signal a lower risk of
fraud. (2.75% flat for a swipe versus 3.5% and 15¢ for keying in the number,
according to Square's site)

~~~
grandalf
Does it follow from this that manual carbon copy "imprint" machines are not
eligible for card present rates?

This may sound dumb, but why not just put this additional security code in a
bar code or QR code somewhere on the surface of the card to allow for the
equivalent security using a camera to read the card?

~~~
pbreit
No, the opposite. A manual imprint is even more indicative of card-present
than a mag-stripe read (which can be easily faked).

Reading QR or other codes with a smartphone's camera is extremely cumbersome
whereas swiping a mag-stripe is simple and reliable.

~~~
grandalf
I totally don't agree with your assessment of what is simple and reliable.
I've had the mag stripe fail on numerous hotel room keys and a few credit
cards over the years. A QR code is readable even if somewhat scuffed, etc.

It would seem that with a small investment in a magnetic stripe writer and a
plastic mould, any scammer could create cards that could fool an imprint
swiper or magnetic stripe reader.

Further, wouldn't a signature make all of the above close to equivalent?

~~~
pbreit
I can't even remember the last time my credit card couldn't be swiped. What do
you do to them?

True, but still even easier to duplicate a QR code.

Signatures don't help very much since the fraudster can sign his own fake
card. That's why more stores are asking to see drivers licenses which is
annoying.

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mattvot
No it won't, for one good reason.

I can buy a Cash Register for around $50, whereas iPads start from $500

~~~
patr1ck
Actually most cash registers start at between $100-$200, and don't do credit
card processing, much less SMS receipts, Google-analytics style sales data
tracking, etc etc etc... The value of Square + iPad beats the pants off what
sort of cash register you can buy for $500.

Not to mention that when the day is over, _you have an iPad._

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seikatsu
Wonder if all the Square attention is good for the broader "POS disruption"
space?

For example Erply (<http://www.erply.com/>), an award-winning startup,
recently made news with porting their web based POS solution to iPads
recently. Any others you know?

~~~
tbgvi
My company, Cashier Live (<http://www.cashierlive.com>), is in the same space
as Erply and some others. We haven't ran into Square competitively at all, as
Square is getting their business traction from mobile businesses & small quick
serve restaurants/coffee shops/bakeries etc.. Cashier Live (and Erply, from
what I can tell) is targeted towards retailers with inventory on the shelves,
something Square isn't good for.

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46Bit
A problem that's immediately been raised by shop owners I know is that of
theft - regardless of how much of a brick it might be to them (strong non-
numeric passcode etc). You can't just walk off with a cash register, or at
least fence it easily & for much.

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petervandijck
Jack Dorsey is practicing to take over the reins from Steve Jobs. Not bad.

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rawsyntax
I don't see this replacing cash registers. Think of places like the grocery
store. Porting all that coupon / discount code?? Too much work

~~~
RobMcCullough
Grocery stores in my area all seem to be going towards the DIY POS systems.

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ROFISH
Does anybody know how programmable their POS is? (ie. if there's a sale, is
there a webhook that can be called?)

~~~
jes5199
No public APIs yet, but we'll get there. (I'm an engineer at Square)

~~~
ROFISH
Thanks! We use Square to handle credit card payments for conventions, but it's
quite annoying to swap between an in-house iPad webapp that handles inventory,
receipt printing, and sending the order data to a master database.

Allowing simple iOS protocol handlers like
"square://pay?product1=Mug&price1=20.00&product2=Shirt&price2=22.00&callback=inventorify%3A%2F%2Fsquare_callback"
and it callsback to url
"inventorify://square_callback?success=true&paid=42.00" would be amazing as I
don't have to have the awkward step of "Exit the inventorify app and charge
the customer for $42.00 through the Square app" and then the cashier forgets
the amount to charge for.

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kgermino
Is it just me or does the CrunchBase entry for Square read like it came
straight from their PR team?

~~~
pitdesi
<http://www.crunchbase.com/company/square>

Most crunchbase entries do come straight from the PR team... Users can edit
them, so most companies do and Crunchbase says what you want it to. It's sort
of like a moderated wiki.

~~~
kgermino
Interesting, I didn't realize it was community edited. Thanks.

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creativeone
Do they have an affiliate program? Or can I become and outside sales rep in
another country?

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thinkcomp
If anyone is interested, FaceCash Register works with cash, credit cards, and
FaceCash payments too.

<https://www.facecash.com/register.html>

It's JavaScript-based so it works on just about every platform, not just iPad.

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nextparadigms
Won't Square be affected by NFC payments when they arrive?

~~~
danilocampos
That's a big when. But in the end, NFC is a hardware issue. Square is adding
the most value on the software and financial side of the equation. If
anything, Square strikes me as the best positioned party, other than Apple, to
capitalize on NFC once it sees some broad adoption.

If Apple makes the NFC APIs private, though, that could put the hurt on Square
given their heavy iOS investment.

~~~
dangrossman
Square would just build an NFC reader into the Square hardware. The phone
doesn't know what's being transmitted down its headphone jack, right?

~~~
danilocampos
Sure!

But Square enjoys a tremendous user experience advantage. It's easier for
everyone to use.

Now, in my theoretical universe where Apple is a bunch of dicks and decides
that they'll keep the NFC APIs to themselves, and assuming they run a service
that competes with Square...

Who's going to want to attach a plastic weiner to their phone versus just
having the "magical, it just works" action that Apple will provide with their
service?

Of course, it may well be that Apple wants a usurious fee for their service
(30%!) and Square could still compete on price. Still – a world where Square
can harness NFC directly on an Apple device is a much better deal for them
than one where they can't.

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pitdesi
This is fantastic news for small coffeeshops etc everywhere.. This makes for a
very compelling use case. It is now far cheaper than a merchant account or
verifone for smaller merchants, when factoring in that you get a free POS
system. Hopefully this will stop the insanity of some payment processors
giving out "free pos" systems but raping merchants on the credit card
processing. We've seen restaurants paying as much as an effective rate of 7%!
because they were going with the company that gave them a "free" POS system.

relevant: <http://feefighters.com/square-calculator> \- a reminder of how good
Square's pricing is (relative to a merchant account) for coffeshops, etc.

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dr_
There was an article suggesting that Apple should purchase a carrier, like
Sprint. Wrong. Square is the company they should really focus on buying.

