Despite the controversy over bending handsets and a broken iOS update, Apples iPhone 6 remains the must-buy addition to the smartphone sector, continuing to draw in the crowds.
One of the most discussed new additions to the latest device is the companys first foray into mobile payments with its Apple Pay feature, the iPhones popularity amongst loyal Apple followers may not be enough to ensure its success in the final frontier of e-commerce.
The reason for this bold move to enter an already crowded mobile payments market is obvious, with the e-commerce landscape in mobile payments expected to be worth more than $1,6 billion by 2017. However, the sector is already saturated by a variety of different players including banks, retailers, and technology companies all offering their own solutions, leaving companies and merchants with a bewildering array of options.
Consumers are finding themselves increasingly swamped by mobile payment apps. They dont want thousands of different apps that can each be used in a couple of different placesthey want one universal app they know they can use anywhere. Just as wallets are stuffed with store cards, users are being asked to fill their smartphones with individual payment apps they will rarely use.
Retailers are likewise faced with the difficult decision of which mobile payment service to choose, with no assurance that the system will go the distance and be worth the investment. Without a clear and universal choice, how can they be sure they have picked a VHS and not a Betamax?
Apple Pay is at risk of becoming just one more easily overlooked choice within this ultra-competitive space, especially as it has made a number of choices that severely limit its ability to stand out above the crowd. With the service limited to just the latest models, retailers introducing Apple Pay face a very limited audience. Despite its universally recognisable branding, Apple is also still just one of many smartphones on the market, facing up against Android, which has a market share of 84.7% cent, up from 36.1% just three years ago.
The decision to limit Apple Pays capabilities to Near Field Communication (NFC) technology also drastically limits its scope to those retailers with the technology installed. Although many in the US are expected to include NFC as they upgrade their POS systems to incorporate chip and PIN, some, such as retail giant Best Buy, have already decided against it due to the high cost of installing and maintaining NFC systems.
Technology aside, Apple Pay is, as the name suggests, simply another way to pay, offering customers another option to paying with their cards at designated POS points and the handful of other use cases where NFC has been deployed. To stand a chance, new entries into the mobile space need to offer much more than just payments.
Dan Wagner is CEO and founder of Powa Technologies.
