It must be a slow news week already. I had to laugh at some of this morning’s headlines regarding Apple. Now that Google’s CEO is gone from Apple’s Board, is Apple plotting to build its own search engine? The Register thinks it’s possible. Another headline says Apple wants to build a PayPal killer. Apple’s good at leveraging one ability to create another. Does Apple need to become a bank, too?
How many ways can you buy what you buy on the web? Generally, I use one of three credit cards accepted by most sites I visit to make purchases. AMEX, Visa, MasterCard.
Some sites, like the iTunes Store, keep my credit card information, most do not. That’s fine by me because it’s obvious that’s the way God intended online purchases to be.
Sure, it seems logical that there be a single sign-in service which lets us purchase whatever and however without entering in the same user information again and again, but that idea hasn’t caught on.
Remember Microsoft’s Passport? How about OpenID? There are plenty of ways to collect my money, spend my money, but no universal system that works well for everyone except to enter credit card information and click Buy Now.
Apple vs. PayPal
I’m intrigued more by the idea of an Apple-branded bank to compete with PayPal than an Apple search engine to compete with Google. Why?
Apple has about 80-million iTunes Store customers already, vs. 75-million for PayPal, so, for all intents and purposes, Apple has something to leverage into another business. PayPal, while not as ubiquitous as plain old credit cards, is all over the web, and makes it easy to purchase online.
iTunes users already buy music, TV shows, and movies from the comfort of their Macs or Windows PCs. iPhone and iPod touch users can buy apps, utilities, games right from their devices.
BusinessInsider propagates the potential and throws together a slag heap of rumors to pit Apple against eBay’s PayPal. We love a good fist fight between giants, right? In this case it’s not so much a brawl as Apple throwing a sucker punch.
Two Step Tango
Apple has both the technical expertise and money to pull a Muhammad Ali shuffle, a technical two step tango, to leverage into a complimentary business.
Apple displays, distributes, and collects money for music, TV shows, and movies. Apple also updates Mac OS X users via Software Update. Apple also handles transactions right from within the iPhone and iPod touch.
Whip all those pieces together and offer the following Apple-style amalgamation: 3rd party software developers would get their own store, ala the Apps Store, for Mac OS X apps, utilities, and games. Apple keeps a cut of the proceeds and builds the software, Mac and Windows, to deliver purchases and updates to buyers.
Apple expands the territory, ala PayPal style, for iTunes users to be able to purchase goods and services elsewhere on the web with a branded purchase mechanism, a one click way to buy online.
To be fair, it’s complicated, but hardly different than what Apple does already with the iTunes Store. They would merely spread the capability to other software developers; probably Mac only (at least at first).
Apple, always quiet about the future, made some future noise by planning to build a multi-billion dollar data farm in North Carolina.
Why would Apple need such additional data capacity unless they were planning for additional revenue streams? Apple won’t build a PayPal clone, but they are building something.