
Walmart and Best Buy Opt Out of Apple Pay – Required Point-of-Sale Upgrades - hyp0
http://forums.macrumors.com/showthread.php?t=1776896
======
deong
The comments there are pretty much why people talk about a "distortion field"
around Apple. It's basically person after person saying, "once all the iPhone
6 users start wanting to pay, they'll have to change their mind."

A few stats (from [http://www.statisticbrain.com/wal-mart-company-
statistics/](http://www.statisticbrain.com/wal-mart-company-statistics/)):
Wal-Mart, as a country, would be the 19th largest economy on earth. Of every
$1 spent in the US, $0.06 goes to Wal-Mart. There are 100,000,000 shoppers in
Wal-Mart _every week_.

NFC needs to become the way you expect to pay for things. Otherwise, it's
Passbook -- that thing you vaguely remember that your phone can do, but that
you don't really use, because in the time it takes to figure out if you can,
you could just swipe your card.

If anyone's going to push it mainstream in one big push, it will be Apple
pairing it with new iPhones. But it's not a given that that's the way it plays
out, and every large retailer who pulls out is important.

~~~
colinbartlett
> Of every $1 spent in the US, $0.06 goes to Wal-Mart.

I do not believe you. How can that possibly be true?

~~~
chrisseaton
In the UK it's often stated that £1 in every £7 spent in the UK is spent in
Tesco - a large supermarket chain.
[http://www.telegraph.co.uk/news/politics/8471807/Its-time-
Te...](http://www.telegraph.co.uk/news/politics/8471807/Its-time-Tesco-haters-
stocked-up-on-facts.html). This similarly sounds impossible. Maybe there's
some extra constraints they don't mention - just supermarkets, or just
consumer spending. I know I certainly don't spend anything like £1 out of
every £7 in Tesco, or any other supermarket. For example I'm sure I've spent
many times more on buying my house than I will in Tesco in my entire life.

This is the sort of thing that More or Less should look at
[http://www.bbc.co.uk/programmes/b006qshd](http://www.bbc.co.uk/programmes/b006qshd).

~~~
justincormack
That must be wrong.

Tesco turnover is £63bn, UK GDP is £1550bn, so it is 4% of GDP, which is equal
to total expenditure.

Your house is misleading, as assuming you borrowed the money, that is other
people's deferred expenditure (saved money) which you will pay back later, so
that nets out when you pay the money back.

~~~
tim333
Apparently it's "Tesco is expected to confirm this week that one pound in
every seven that is spent in British shops goes through its tills." So house
sales not included.

[http://www.telegraph.co.uk/news/uknews/1548742/1-in-every-
se...](http://www.telegraph.co.uk/news/uknews/1548742/1-in-every-seven-now-
spent-in-Tesco.html)

------
coreymgilmore
I have two thoughts on Apple Pay:

1) Android has had cardless payment for 2+ years now via Google Wallet. That
being said, Japan has had similar technology for way longer. While the
marketing machine that is Apple made sure to let everyone know how
magical/revolutionary/awesome/brilliant this form of payment it, Apple is late
to the game. Similarly, other products such as Softcard/ISIS exist too from
non-smartphone companies. Thanks Apple for finally catching up.

2) Apply Pay will, however, finally give cardless payment the push it needs.
Apple has the market power to get retailers to start (read: more than rarely)
embrace this technology (for example: Passbook & tickets). That I can fully
support Apple for as the iPhone is the single best selling phone and will get
NFC into the hands of millions very, very quickly. And with the volume of
devices + Apple's marketing of Apple Pay = great news for payment.

~~~
DCKing
I don't think your first thought is relevant for all of this.

It has been quite clear for quite some time that mobile payments was not a
technology problem but a policy problem. The technology was not just ready for
it with the release of the Nexus S - it was ready for it for years before
that! The problem was getting people to actually use it. Since most vendors
were trying to use mobile payments for their own short-term gain, things were
going nowhere.

Apple has not "caught up" in that sense at all since they weren't behind in
any meaningful way. There was no important reason for smartphones to have NFC
as there did not exist many use cases for it _without_ payments. Although I
had high expectations of NFC when I bought my current Nexus phone two years
ago, things simply never got off the ground in that area.

The contribution that Apple Pay makes to the market is quite unique if you
look beyond technical merit. It provides an intuitive user interface for
_anyone_ 's payment product for use in mobile phones. It isn't tied to your
prepaid Google Wallet card, it isn't tied to your SIM card, and it isn't tied
to propietary point of sale hardware. Furthermore, it is being pushed

I'd argue that Apple is the only one with the required leverage to push
something like this into a market obsessed with conservatism and self
interests. They have the power to convince shops and banks to cooperate with
it, moreso than Google. Moreover, because they have their own hardware, it is
easier for them to integrate a secure element and a user-friendly
authorization method (the fingerprint scanner) to have an integrated solution.

It's not as if Apple has reinvented the wheel or anything, and I hope nobody
is claiming that. But their execution of this idea seems very good. And it is
the execution of the idea, your second point, that is the important part here.
I hope that Google can fight off its own and carrier interests, and follow
suit with a similar application. Many Android phones already possess all
required hardware.

~~~
dhagz
As mentioned in the article, Apple is taking advantage of required changes in
POS systems to help make this push.

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jusben1369
Apple Pay will have slow adoption simply due to it being tied to new phones
and/or the US. That's tiny in global payments. Then I think its early traction
comes via in app mobile payments. Things like Lyft and Uber. From there it'll
branch out into physical retail. Short answer is the battle at retail is still
2-3 years away at least and that's OK

~~~
WorldWideWayne
I'm a techie and there's no way I'd consider using NFC until it's as simple as
swiping my credit card. If it got that simple though - what would be the
point? My credit card works fine.

Do I need another middle-man between me and my money expenditures? Nope. I
already have trouble with Amex being overly secure and blocking my purchases
at certain sites and locations.

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abritishguy
If the technology that Walmart is backing only requires a software update to
existing phones then it is not nearly as secure as apple pay.

A lot of people are comparing Google wallet and apple pay like they are the
same thing - they are not. A phone with compromised firmware could leak
sensitive data with Google wallet but not with Apple pay.

~~~
drdaeman
Depends on implementation.

NFC has that "secure element" thingy, that is, a TPM, like a SIM card.
Implementations may vary. I'm unaware on actual Google Wallet NFC
implementation, but I heard rumors (which are not certain by any means) at
least Samsung had some hardware-assisted keystore. And I doubt Visa or
MasterCard would permit Android vendors to do things on a phone's base OS a
manner that could be exploited with a software hack.

~~~
abritishguy
The card details were stored on the secure element but the pin was not and
because the authentication is not done using the secure element it is trivial
to bypass: [http://cybersecurity.mit.edu/2012/10/google-wallet-
overview-...](http://cybersecurity.mit.edu/2012/10/google-wallet-overview-
threats-and-security-measures/)

The current implementation of Google wallet stores your card details in a
google server which protects against these attacks but is not a viable
business model (google are making a loss on every transaction since they pay
it and then bill the customer themselves).

~~~
stephenr
I suspect they consider it a worthwhile cost to get their hands on a persons
complete transaction history

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invisible
It's pretty weird that both Walmart and Best Buy will probably be required to
advertise Apple Pay and yet won't support it at their registers that is going
to burn a lot of customers. If they don't want to support the NFC payment
movement they shouldn't sell the products that have NFC. They are just going
to regret this decision at some point when NFC is the norm and they have to do
yet another round of POS upgrades.

~~~
WorldWideWayne
The phones doe a lot more than NFC payments. Why _shouldn 't_ they take a
customers money just because they're betting that NFC payments will never
achieve widespread popularity.

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sandGorgon
is the fundamental act of a card swipe broken ? On on hand, I can clearly see
the value of Square... and on the other hand, I can also see the value of
business models like LevelUp (that commoditize mobile payments and leverage
marketing budgets).

But is a disruption of mobile wallets vs credit cards even possible ? Why
would a 19-year old college student prefer it ... or why would a 30 year old
professional switch to it _over credit cards_ ?

~~~
Istof
I recently switched from magnetic stripe card to chip card and it is far
slower to do a transaction... and by the end of 2015 most cards in the US will
be chips probably... so I guess this could be one reason.

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therealidiot
I'm not up-to-speed with Apple's new shiny things, is Apple Pay compatible
with existing contactless payment systems over here in the UK?

~~~
gergles
Yes, it is. djhworld is laughably wrong.

All the contactless systems Visa/MC/Amex are deploying in the world are
variants of PayPass/PayWave which are all based on an international standard
and will work no matter what. The article djhworld linked to is talking about
how users _in_ the UK won't be able to add cards to Apple Pay because Apple
doesn't have any deals with UK banks. If you go visit the UK and have an
already-enrolled Apple Pay account, it will work at contactless terminals.

------
ghaff
One general issue I would have with Apple Pay is that I use credit cards that
give me specific rewards such as money back or airline status-related
benefits. Of course, there's no reason that Apple Pay couldn't be tied into
similar reward programs but until it is, anyone who currently uses a reward
card is likely to keep pulling out the plastic rather than bump the phone.

~~~
pktgen
According to [http://www.apple.com/iphone-6/apple-
pay/](http://www.apple.com/iphone-6/apple-pay/):

> Apple Pay works with most of the major credit and debit cards from the top
> U.S. banks. Just add your participating cards to Passbook and you’ll
> continue to get all the rewards, benefits, and security of your cards.

~~~
ghaff
Ahh. Thanks. I realized it worked with the existing credit card processing
networks but didn't know it worked with the actual already issued cards--but,
thinking about it, it makes sense that it would have to. (Given that it's the
actual card issuers that determine credit worthiness, etc.)

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rgrieselhuber
I'm guessing that Walmart customers are more likely to use Android vs. iOS.

~~~
joesmo
All customers are more likely to use Android vs iOS, even in the US as its
marketshare is much greater. Unless you just mean to imply that people that
shop at Walmart are poor, which whether true or not, is irrelevant.

~~~
pessimizer
Why would it be irrelevant to Wal-Mart that Apple's marketshare is even lower
amongst their customers than in the general population? I think it's crucial
to note that price-conscious bargain shoppers and luxury fashion phone buyers
may not overlap as much as the general numbers would indicate.

