Walmart and Best Buy Opt Out of 'Apple Pay' as Apple Leverages Required Point-of-Sale Upgrades

[scottwaugh]

Three things. First, the MCX is clearly driven by the desire of the retailers to avoid the processing fees from credit cards. It only works with store cards or your checking/savings account...

Totally on target here. MCX gives the retailer that 2.5% back the credit card companies take each time and supposedly is much freer with giving the retailers access to customer data as well...and ApplePay keeps that 2.5% charge in place.

With Best Buy, its a little hard to see - although that 2.5% take adds up fast for expensive electronic things purchases...so I could see the allure.

MCX also works with existing phones, from what I understand it makes a scan-able bar code image on your phone's display that is "scanned" by the register checkout...the downside is its not ready yet. But it could roll out to a much larger client base quickly.

As a consumer, I prefer Apple's idea.

... Sounds like Walmart are cheaping out on their card readers.

No, I think Walmart wants get rid of that 2.5% charge the credit card companies take (and ApplePay preserves) - MCX does get rid of it. Considering the clientelle that will have ApplePay, I'd guess they'll reconsider in a year or two though.

 

[SeaFox]

No great loss. Every time I go into a Walmart, there 5000 people in ONE LINE and every time I go into BestBuy, I get ignored.

Whoa. Tell me the secret to getting ignored at Best Buy. I'd love to be able to shop without their floor staff trying to "help" me all the time.

 

[tasset]

My guess is walmart doesn't want to lose their massive customer data tracking capabilities.

If the merchant can not see the customer name and only a temporary credit card number (with apple pay), they will lose out on a lot of customer data. Big stores don't want these type of technology gathering steam. They would rather keep the data along with the privacy/hacking risk.

Naaaaaailed it. This is exactly the same situation the magazine publishers took issue with, they did not want to relinquish customer data that they in turn sell/trade for more profit than their actual publishing works. Despicable. But no surprise in a race-to-the-bottom Google-y world of ad men.

 

[downpour]

While I think Pay on the iPhone looks pretty solid. The Watch opens up all sorts of security problems. They really should just make TouchID on the iPhone 5s+ the only way to unlock the watch, rather than giving full, fast and untraceable access to all your credit cards via a single pin.

 

[gotluck]

I got you, I just dont think it's coincidental that they've decided to invest now. of course they're influenced by apple

I would wager that apples decision to implement it now was made with the emv deadline in mind.. or at least that would be intelligent. vendors have to invest by the deadline if the vendor does not want to be liable for fraudulent transactions. fulfilling regulations and looking hip with apple, 2 birds with one stone. more of a no-brainer than it already was with just the regulation

 

[StyxMaker]

I think one of the places I'll use apple pay the most (once I upgrade to 6Plus2 next year), is Starbucks. Often people order their drink and when they pay in cash, often take a while getting it.



Apple Pay will, hopefully, make the line go quicker, as long as their battery doesn't die and they have to plug it in for it to work

I already use my iPhone to pay for my iced espresso at Starbucks.

 

[cjmillsnun]

But isnt that what they're doing?

No. Retailers will be liable for fraudulent mag stripe transactions shortly. EMV transactions will continue with the banks taking liability.

Retailers won't want to take the hit, so investing in EMV is a no brainer.

 

[AllieNeko]

Naaaaaailed it. This is exactly the same situation the magazine publishers took issue with, they did not want to relinquish customer data that they in turn sell/trade for more profit than their actual publishing works. Despicable. But no surprise in a race-to-the-bottom Google-y world of ad men.

Nonsense, Walmart doesn't track nearly as much customer data as, say, Target. Walmart doesn't want to enable contactless because it takes away DEBIT routing choices. Same reason Best Buy disabled it.

 

[ThisIsNotMe]

If you think the technology and infrastructure on the stores end is free your naive.

Instead of outlaying $100,000,000 for the U2 album, Apple should have dropped that $100,000,000 on 1,000,000 NFC enabled terminals for retailers fee of charge.

 

[gotluck]

Instead of outlaying $100,000,000 for the U2 album, Apple should have dropped that $100,000,000 on 1,000,000 NFC enabled terminals for retailers fee of charge.

that sounds like a better idea to me

 

[mazimoyo]

Will Best Buy be around in 2015? LMAO

Exactly! Not opting in leaves them with less to sell off in the end.

 

[hudson1]

In some senses I'm quite proud that Walmart and BestBuy are making a stand. While I'm all for the ubiquity and convenience I'll receive with PAY as an iOS citizen these upcoming security mandates were a real chance for transaction facilitators to come together and unify the crap out of this instead of giving poor old merchants yet another bloody rub.

Apple have strong market share but they aren't the only smart NFC device provider and with their locked in proprietary nature, not playing nice with the other guys (Android, for one) is going to lead to some stupid AT&T vs Verizon type split for coverage and support, all at the cost of precious resources.

Good on Walmart and BestBuy for choosing a solution that supports all customers, send a message to these overly rich executives that some things need not be a competition.

(Google Wallet + Apple Pay) Future Ca$h support POS for the win.


[Edit: Have since discovered that Apple Pay only requires the merchant/vendor to support NFC to work. Vying for MacRumors to do some kind of an editorial on the matter so we have less confusion and unnecessary posts in the forums. My last point still stands - Future Ca$h support POS for the win]

Just going through this thread for the first time and I found the first post based on logic. Congrats.

 

[jehrler]

Merchant's don't "sign up for Apple Pay".



It's not a "new" system. It's the NFC functionality in existing PoS terminals, which is already deployed by many retailers.



Retailers have to deploy an EMV chip reader PoS by 10/2015, or they will have to assume liability for any fraud. Unless they have already specified and tested a custom system, all they have to do is deploy one of the many merchant terminals that also have NFC support.

This is all exactly correct. Thank you for reinforcing these points to counter really uninformed guesses/speculation.

 

[nsayer]

I mean right now. When you use your credit card, BB stores the card number, name, info, etc. They send it to a company called TMC which tracks all your purchases and ensures you do not exceed an x amount of returns.

Oh and sells info to other companies. Obviously not CC info, but purchase history, etc

Yeah, but the way you worded your original statement implied (by my reading at the time) that you thought that their supposed inability to do that with Pay had something to do with them opting-out of it. Perhaps I misread. But I have no illusions that the per-transaction revolving virtual card number system would prevent customer behavior tracking. I would actually be shocked if a fixed customer identifier (akin to a hash of your SSN, but probably not that) weren't part of the payload delivered to the merchant from the CC back-end (at least for merchants with sufficient clout) to disambiguate all of the "Mark Smiths."

 

[Trapezoid]

I would wager that apples decision to implement it now was made with the emv deadline in mind.. or at least that would be intelligent. vendors have to invest by the deadline if the vendor does not want to be liable for fraudulent transactions. fulfilling regulations and looking hip with apple, 2 birds with one stone

But why not do it with Google? You bring up good points, but I think it's fairly obvious that apples influence has a lot to do with this. Again, this is not new tech...far from it. When, not if, we see the huge explosion of nfc in the coming year, it's a little incredulous to say it wasn't influenced by apple.

Incidentally, when is the emv deadline if you know

 

[jklps]

I'm not a hipster, but why would I go to the closest Walmart that is 25 minutes away that in driving would also pass two Targets?

Best Buy is just sad every time I go in there. Huge space filled with 50% of the stock it used to carry, and 90% less customers. I'm confused how they can even afford to make rent or property payments.

 

[AllieNeko]

But why not do it with Google? You bring up good points, but I think it's fairly obvious that apples influence has a lot to do with this. Again, this is not new tech...far from it. When, not if, we see the huge explosion of nfc in the coming year, it's a little incredulous to say it wasn't influenced by apple.

Incidentally, when is the emv deadline if you know

US EMV deadline is 1 Oct 2015

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Exactly! Not opting in leaves them with less to sell off in the end.

Best Buy is like Target, they have the hardware for both NFC and EMV, it is just disabled. They have had it much longer though (Target JUST got it).

 

[gotluck]

But why not do it with Google? You bring up good points, but I think it's fairly obvious that apples influence has a lot to do with this. Again, this is not new tech...far from it. When, not if, we see the huge explosion of nfc in the coming year, it's a little incredulous to say it wasn't influenced by apple.

Incidentally, when is the emv deadline if you know

of course apple is making it mainstream

I just feel like you are downplaying the significance that vendors really have no choice other than to oblige with upgrading to emv terminals, most of which support nfc. Forget apple and google, vendors would have to upgrade even if paywave with a credit card was the only way to use nfc.

Apple is mighty, whatever they do is household knowledge, Im not questioning that - I don't know if they are mighty enough to get all of corporate retail to upgrade their POS units though

 

[jehrler]

You're getting far too granular. I never mentioned anything that nitty gritty for you to refute.

The merchants/retailers are the ONES WHO ARE BEING ASKED TO ADOPT this Apple product/service. Period. The retailers are essentially on the hook for a lot of possible problems and general adoption issues. Period. Your reply is similar to me calling ATT and stating the service stinks and they tell me I should really call company ABC whose chips are on the cell towers. No. I pay ATT and I don't care how ATT services me. Ditto with Apple Pay...at the end of the day Apple is pitching this product/service to the retailers...and so far (for all if not more of my reasons) the retailers are not going forward with Apple.

My original post is valid.

Actually you are totally INCORRECT and INVALID. The retailers are being asked to adopt NFC terminals for use by NFC enabled Cards, Google Wallet on Android Phones, Whatever it is on Windows Phones and Pay.

Apple is simply saying that they are going to, like Google Wallet, support NFC just via their back channel system.

Who is Apple actually working with? The banks and card issuers because they need their "virtual card #s" and one time tokens to be matched to already existing credit and debit card accounts. THAT is who Apple is working with.

 

[nt5672]

Best Buy is teetering on the edge of extinction you'd figure they'd do everything they can to make their costumers er... customer happy...

i'm guessing they can't afford the upgrade.

 

[hudson1]

This has nothing to do with Apple Pay per se. Its all about who controls the upcoming mobile payment revolution and profits the most out of it.

The telcos like Verizon and AT&T already tried to control it -- but failed. So now some large retailers are trying to control it and hope to make $$$$ off of it.

But if Apple Pay takes off in many other outlets, these retailers will have no choice to accept it. Just like they accept many credit cards (not just one) , they will likely eventually have to accept many mobile payment systems, including Apple Pay.

Apple's solution is akin to them asking retailers to install a new credit card device (granted, much more secure) and then saying it will only accept one credit card. The best way for Apple to make money on this is to open the protocol so all smartphones with NFC can take advantage. THAT will get the attention of retailers. Let's remember, Apple only has a 15 - 20% market share of smartphones. Retailers know that quite well.

 

[dontwalkhand]

Targets new Verifone terminals do support NFC, AND chip cards. They are waiting on new register software in early 2015.

Walmart's new ones do too, but older stores need upgrading.

Even Arizona grocery store chain Basha's now have NFC, ITS HAPPENING PEOPLE

 

[kilcher]

Couple of things here.

1. have not heard from Costco yet, bet they get on board ASAP due to the relationship with AMEX- watch for that.

2. A lot of folks on this thread seem to be under the impression that it is just as easy to whip out a CC from you wallet. Time wise, that is accurate- but you are all missing the point. This is about SECURITY for you.

Just recently, I had my debit card breached (I always use it as a CC btw). Someone ran up 380.00 in groceries at a store near my primary residence. Weird thing (or good thing), I was in another state at the time, and was able to prove it to get my money back quickly. Re-issued me a new card, all was ok. Who knows how it was skimmed, but to make the purchase, the thief had a duplicate card made from my #'s.

Point being is that with the Home depot breach, Target, PF Changs, etc... I am worried currently what can show up in the next 12-24 months from that problem. Fortunately I only carry AMEX for a CC, so I feel pretty protected and rightfully so.

TLDR, I love this security feature and will use it to protect myself from any thief earning a living stealing my data without my knowledge.

Yeah, but from what I understand this won't stop any of that. If someone has your card # or a fake card they can still use it as they could before. All the fingerprint sensor does is stop them from using your PHONE as a credit card and really who would do that?

Ex. I had three charges to my debit card last week, 2 in Mexico and 1 in Texas (I'm in Illinois). Even if I had my debit card linked to Apple Pay that would not have stopped that person from obtaining and using my information (unless they somehow got the information directly from my card and not elsewhere, which is possible).

The only way I could see this really working 100% (or close to) is if you could somehow only authorize transactions from your phone and deny any transactions that use your card or card #.

I could be way off though.

 

[dontwalkhand]

i'm guessing they can't afford the upgrade.

What upgrade? Their terminals have this ability, just turned off. It is Best SUCK

 

[aloshka]

Yeah, but the way you worded your original statement implied (by my reading at the time) that you thought that their supposed inability to do that with Pay had something to do with them opting-out of it. Perhaps I misread. But I have no illusions that the per-transaction revolving virtual card number system would prevent customer behavior tracking. I would actually be shocked if a fixed customer identifier (akin to a hash of your SSN, but probably not that) weren't part of the payload delivered to the merchant from the CC back-end (at least for merchants with sufficient clout) to disambiguate all of the "Mark Smiths."

You are probably right. Although Apple does seem to care or at least appear to care more about privacy security than everyone else.