This article originally appeared in the 10.30.14 issue of Metroland
When Apple rolled out the iPhone 6 a couple of weeks ago,
most of us were too busy running around yelling about the atrocity of having
the new U2 album rammed down our throats to notice a really important
the introduction of Apple
Pay, a mobile payment app that comes with the iPhone 6.
didn’t pay attention because it’s fairly mundane and obvious:
Apple has partnered with a bunch of credit
card companies, and now you can pay for stuff at participating retailers by
simply waiving your phone in front of a reader.
It’s something we all could see coming a mile away—in fact, it’s already
been around a couple of years with a cellular carrier-backed mobile payment app
for Android users that until recently had the unfortunate name of Isis, but which
has been renamed Softcard.
also Google Wallet.
this is Apple, Apple Pay feels like a tipping point.
It’s safe to go in the water now.
The future is here, etc.
The seamless app is also fairly secure—the
retailer doesn’t get your credit card number or even your identity, so you
don’t need to worry about data breaches, at least at the store level.
And since the app is activated by
fingerprint-sensor Touch ID, you don’t have to worry about someone absconding
with your phone and running up your credit cards, unless they also abscond with
like Apple had gotten past the U2 debacle and Apple Pay was catching fire, when
the CVS and Rite Aid drugstore chains bluntly announced that they would not be
accepting Apple Pay.
The deal is that a
bunch of retail chains, including not only CVS and Rite Aid but also Wal-Mart,
Best Buy and Target, have been busy cooking up their own mobile-pay app,
something called CurrentC.
bypass credit card companies and take money straight out of customer bank
This means gazillions of
dollars to the retailers, who have long complained about credit card fees reaming
CurrentC will also track
consumer habits across all participating retail stores, giving way to an
uber-database of individual and mass shopping behavior.
Unlike the other payment systems, which use
“near-field” contactless communications, CurrentC will rely on scanning QR
Codes, those ugly little bar-codey things that were ubiquitous a few years ago,
adopted by all kinds of business trying to be so with-it and modern, that
hardly anyone ever actually used.
good luck with that.
reaction was damning, with commentators blaming the greedy drugstores for
undermining consumer choice and what’s left of consumer privacy.
Then it was disclosed that these chains were contractually
bound to use CurrentC
exclusively, that when they all signed on several years ago to help develop the
service, they all agreed not to allow competing technologies at their
check-outs, and agreed to pay heavy fines if they did.
Which is a really stupid thing to agree to,
given the rate of change of technology and the tendency for innovation to
produce new, unforeseen solutions to old problems.
So here we
are right now, with a weird kind of stalemate, with all these big retailers
unwilling to allow the super-hot Apple Pay app while waiting for their own
CurrentC app to land, which isn’t supposed to happen until sometime next year.
I have a
hard time choosing sides here.
hand, rooting for Apple Pay necessarily involves rooting for the credit card
companies, and who wants to do that?
They’re usurious and ugly corporations that hopefully will soon get
bitcoined out of existence.
On the other
hand, do we really want Big Retail to be able to track all of your shopping
(I’m not sure about this one; I
like getting tailored info about deals on things I actually buy)
More importantly maybe, do we really want Big
Retail, which has had near-constant issues keeping confidential consumer
information secret, to have a direct portal into our bank accounts?
that the Big Retail players will get together and agree to let Apple Pay and
whatever other mobile-pay technologies come in and compete with CurrentC.
To do otherwise will get people PO’d, and
might even be illegal.
I’m no expert on
anti-trust law, but something about allowing one payment system and barring all
the rest doesn’t smell right.
all these systems are designed to flow through the same back-bone and use
generally the same hardware, so this isn’t a tech problem so much as a business
gloves come off so we can shop the way we want.
C’mon, this is America for crying out loud.
Paul C. Rapp, Esq. is
an often casually-dressed woodsman lawyer specializing in IP law who typically
doesn’t go out shopping for anything other than food, power tools and bourbon.