The mainstream tech media seems to think Apple is locked in yet another battle that, inevitably, it will lose, going up against Walmart-backed MCX (Merchant Customer Exchange) in the rapidly growing mobile payment arena.
Here’s the problem with that analysis. It is shortsighted, self-serving, and just plain wrong. Here’s why.
First of all, Apple Pay works on the existing network of NFC systems, which, by this time next year, will be nearly ubiquitous across the U.S., dwarfing MCX, despite the presence of Walmart and other big box store merchants looking to shave a percent or two off their credit card feeds.
Second, for now, MCX is debit card, not credit card, which means it’s aimed more at the lower socio economic strata of card holder– the Walmart folks– and not those with more discriminating tastes regarding purchases, finances, and methods of payment.
Third, NFC-based mobile payment systems have been available in the U.S. for a few years, including Google Wallet, and the tens of millions of Android smartphones with NFC installed. Yet, only now are mobile payments growing because Apple Pay entered the market, and within days became the most used mobile payment system.
Finally, MCX is doomed, at least in the current incarnation, because of the effort required to make a purchase. I base this upon personal experience with all three systems– Google Wallet, MCX and CurrentC (the iPhone app), and, now, Apple Pay and my iPhone 6. Try all three apps and tell me which one you want to use.
Once my bank and credit card were available for Apple Pay it took all of about one minute to get it set up, and almost 15-seconds to make a purchase. I entered my newly approved credit card into Passbook on the iPhone. It took less than a minute to enter and get verified. Then I went shopping. The first purchase took 15 seconds. My purchase was scanned by the clerk. I pointed the iPhone 6 at the NFC scanner. My bank card icon appeared on the iPhone screen. I pressed Touch ID. Transaction completed.
That’s how to buy something, Apple style.
Google Wallet has been around awhile already, as have NFC-equipped Android smartphones, and Apple Pay topped the number of users and transactions on mobile payment systems in a week (and only on iPhone 6 models). MCX is a mobile payment system designed for the retailer to collect information about the customer, and to bypass the major credit cards and their fees. Google Wallet is a mobile payment system designed for Google to collect information about the customer’s usage and buying habits to sell to advertisers.
Apple Pay, already more secure and easier to use than other systems, is also the most private. The merchant does not know who you are. They get their money and that’s about it. Even Apple doesn’t care what you bought or when or from whom or why.
It doesn’t matter much if Apple retains the title of most used mobile payment system in the U.S., as a system that brings delight to tens of millions of customers, it will succeed because it is secure and customer centric. So, I’m a little unclear on the specifics dear technorati elite media writers. How is it again that Apple Pay will fail because of big bad Walmart and Google?