Riding someone else’s horse and claiming victory. Europe.
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World's First Apple Pay Alternative for iPhone Launches in Norway
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Fees are one thing. What's more problematic from the customers perspective is that Apple is really slow with rolling out more advanced features like P2P payments. There is also the issue, that Apple tends to only work within its own ecosystem. When you need to pay someone directly, you want a system that will also work with Android. Why should Norway want to wait potentially years before Apple manages to implement every local payment scheme on the planet? At the current pace this could take decades!
What do you know, the next day they allowed Apple Pay. 2-3 years to late, they've been a joke in Norway
All DnB and SBanken customers will now get Apple Pay:
https://e24.no/privatoekonomi/i/XjEJnB/naa-ruller-dnb-ut-apple-pay-til-24-millioner-kunder <-- Norwegian
DnB has never supported Apple Pay. SBanken customers had Apple pay, but DnB took it away when they bought SBanken (one of many decisions that has made Sbanken go from the best liked bank in Norway, to the most disliked in very short time).
https://e24.no/privatoekonomi/i/XjEJnB/naa-ruller-dnb-ut-apple-pay-til-24-millioner-kunder <-- Norwegian
DnB has never supported Apple Pay. SBanken customers had Apple pay, but DnB took it away when they bought SBanken (one of many decisions that has made Sbanken go from the best liked bank in Norway, to the most disliked in very short time).
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From today DNB, the largest Norwegian bank have started supporting Apple Pay.
https://e24.no/privatoekonomi/i/XjEJnB/naa-ruller-dnb-ut-apple-pay-til-24-millioner-kunder
You don’t need Apple Pay integration to transfer money to another person. You can do so within the app, which is an entirety separate service altogether.
About 8 out of 10 payments are done via BankAxept, which is the national payment processor in Norway, MasterCard and VISA have a minority of the payment processing market here. Hence supporting the payment processor who have the majority of payments processed makes sense, although Vipps support MasterCard and VISA in online payments via the app, just not via Tap to Pay yet.
Apple Pay also support payments via BankAxept as of summer '24, but not many banks have implemented this yet, it relies on MasterCard and VISA for most banks so far.
True. But NFC can also be used to make in-person P2P payments more convenient.
More competition is good for the payments market. Apple Pay is essentially cementing the Visa/Mastercard duopoly because it does not support many local payment networks.
0.15% would be half of the interchange fees allowed (regulated) by the European Union on Visa/Mastercard consumer cards - a regulation which has increased card acceptance substantially.
I’m not against Apple Pay. It works great and I love it.
But I’m all for it competing on its own merits: customer experience, security, fees - not gatekeeping and monopolisation.
They just merely balance things out - against the blind adherents that advocate Apple…
- being just about the of the biggest and most valuable company in the world
- and operating technological platforms highly important to today’s societies
- in duopoly markets with severely limited customer choice (in mobile OS and application stores)
Often flat out denying - or being in denial - that anyone else (except Apple) can provide security, privacy and has consumers’ interests in mind with their products.
👉🏻 The idea that anyone using a piece of software that malfunctions would or should contact the developer of the underlying operating system is ridiculous.
It’s about as much “in the chain” as failing to purchase an item or service from an online store in a web browser - and contacting the operating system vendor for support.
There are many apps that use the NFC chip of the iPhone - no problem at all. So has secure enclave be documented for developers. A payment application could have been made for years with the building blocks Apple provided - it’s just that Apple (again) restricted NFC access for payment transactions in order to monopolise that market (for iOS users).
👉🏻 Also, what do you believe happens today, when I fail to make a payment using my iPhone?
Does Apple provide support - or do they refer me to my card issuer?
One that was (as I understand) established and is owned by the local banks that customers bank with anyway.
Not a foreign technology company from the a country that’s known for its internet surveillance and intelligence gathering around the world.
They’re on equal footing with them for providing payment (intermediation) services.
That’s a separate (though somewhat related) market from mobile phones and their operating systems.
You don’t like Apple ? BUY SOMETHING ELSE. I don’t care about monopoly/duopoly. I don’t care about how many money Apple is making. I buy Apple products because they are what I need/like.
And YES, over this matter I don’t think anyone else can provide same security, privacy and customer’s satisfaction. That’s why I spend money on Apple.
You don’t like it ? Just buy something else.
No I’m not. I’m a very competent and informed customer.
I like the alternatives less.
Why?
You said it yourself:
I don’t like being the product.
Neither for Google (to collect data).
Nor for Apple (in gatekeeping and charging other businesses for providing valuable products or services to me).
I feel Visa / Mastercard have dominated long before Apple Pay, because of the role they play in allowing users to buy items on credit (ie: spend money they don't actually have yet), which in turn drives volume for merchants. This is what makes them popular, not so much that they are available on Apple Pay.
What a lot of other mobile payment / wallet apps seem to do is that they let you put money into an account, then you can only spend the money you have, which kinda defeats the whole point. To my (admittedly limited) knowledge, VIPPS doesn't let me spend on credit, or the rewards to be had from using their service seem non-existent compared to what I could earn from using credit cards.
Nor does it seem like VIPPS would open up any new use case that I couldn't already do with a credit card (tipping is one example where small amounts are impractical to do due to merchant fees, but it seems the fees charged by VIPPS is just as prohibitive).
I guess what I am trying to say is that while many people here seem to be cheering that there is evidently more choice, I am not really seeing what VIPPS lets a customer do better or differently that they couldn't already do with Apple Pay (unless you say that there are merchants colluding to support one standard and not the other). So more options, or just more of the same?
Credit card rewards are merely a compensation for overinflated merchant fees (costs of credit card acceptance) that ultimately get passed on to consumers.
Where I am at least, things cost the same regardless of whether I pay with Apple Pay or cash or some other payment standard. So it's not uncommon to own multiple credit cards, and pay using credit in order to rack up points and rewards. I only carry 2 debit and 2 credit cards and consider myself very conservative compared to some of my friends who carry like 6-8 credit cards (like 1 is used solely to pay for petrol), and it's nice to see the few extra hundred dollars deposited into my account every month.
And I don't even spend beyond my means. Everything I buy, I have the means to just pay the full amount on the spot, and I always pay off my credit card bill in full every month. Maybe you are right in that merchant fees get factored into the final price, in which case I may as well play the game, because the alternative is to pay full price for everything while getting nothing back in return.
What I am trying to say is that credit cards often seem to get a bad rep, but they do solve a legitimate problem for merchants and consumers and I really am curious - what does this VIPPS standard do any better or any differently, and when would I use it over Apple Pay?
Visa and Mastercard might be the standard in your country. Many European countries have local payment schemes that compete with the global ones. They are very often co-branded with V/MC to be more useful abroad and online.
Some merchants who are very cost-conscious because of low margins only participate in the local payment scheme. So there is an advantage to use the localized service like Vipps for the customer because they can pay at more points of sale.
Apple has been very slow adapting to local payment markets. They probably don't think it's worth it and prefer to support only the bigger ones. This is really bad for smaller countries, who prefer to keep a payment system that is under their control. With the way the current political environment is developing, I think this is a wise decision.
I mean, isn’t the whole point of Apple Pay precisely that Apple uses leverage to make banks and merchants hop on board (or potentially miss out on sales volume). You just admitted that by opening it up to other standards, there’s now even less incentive for merchants to support Apple Pay, and I assume Apple won’t be getting a cut of VIPPS transactions.
I mean, isn’t the whole point of Apple Pay precisely that Apple uses leverage to make banks and merchants hop on board (or potentially miss out on sales volume). You just admitted that by opening it up to other standards, there’s now even less incentive for merchants to support Apple Pay, and I assume Apple won’t be getting a cut of VIPPS transactions.
But going back to your main concern around consumer convenience, there is no need to use leverage to make banks and merchants hop on board if there is a local solution that is ubiquitous and works. The friction and therefore need to convince anyone only exists because the Apple Pay is the only game in town on an iPhone.
I understand why competition might be bad for Apple here, but I'm not sure why this should be a major concern. Apple Pay is a fantastic solution, but I don't see why it should be protected from competition. This is exactly the kind of leverage both Apple and Google can exert to use their hardware and/or software platforms to push into other markets.
Just so we are clear, I am not suggesting that Apple is some special snowflake which needs to be protected from competition, but perhaps we do disagree on what meaningful competition looks like for Apple. In my opinion, Apple has successfully competed against the competition by sinking billions and literally betting the farm on building an integrated ecosystem where their products play well with one another (no easy feat). To me, their product is the whole ecosystem, not individual piecemeal offerings like the Apple Watch, Apple Music, Apple Pay, the App Store or even the Apple Pencil, which is why I fundamentally disagree with what the DMA is trying to accomplish.
I do also find it interesting that in all this discussion, much is mentioned about Apple, of the banks, and virtually no mention is made of consumers or what they presumably think of all this. It goes back to a point I made many years ago about the fundamental difference between US and EU antitrust law (the former focuses on harm done to consumers, while the latter apparently focuses on businesses). Ultimately, I get that terms like "leverage" seem like dirty words here because they imply that Apple is getting some sort of unfair advantage, and it also ignores how Apple uses leverage to create a great user experience for their customers, who vote with their wallets by buying their products, and this creates a virtuous cycle where Apple is able to generate more leverage to get stakeholders to acquiesce to create a better experience for the end user, and so on and so forth.
In this case, VIPPS is just forcing its way in (with the help of the EU) without needing to make any concessions at all. Think back to how Apple used leverage to sell music for the iPod, then to block carrier meddling for the iPhone, and now this. Ultimately, the DMA is an attack on Apple's integration and the superior user experience that tends to result as a result of this vertical integration, and this forum seems pretty convinced (or is at least hoping) that the theoretical promise of competition will result in banks (of all businesses!
) creating a better consumer experience than Apple.
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To add what @Abazigal said, I also have have fundamental disagreement with forcing a company to do things like "change your Operating System to allow others to use hardware you put in your hardware devices" without a compelling reason, and given that the smartphone platform with 75% marketshare already allows full access means there isn't a compelling reason in my mind. I really feel like the EU isn't going to be happy unless iOS turns into a prettier version of Android.
While I'm not up in arms about this (like I am with other potions of the DMA) I still view it as government overreach. I know many disagree, but the EU experience regulating tech to date should show everyone that they really should do as little as possible - see Crowdstrike, GDPR, etc. It is absolutely, abundantly clear that the EU rather have consumers have a worse experience so that businesses have it easier. I think consumers should be put first, not companies.
EU is making life hard also for Google… Something is good, but many battles are just witch hunting.
Where would Apple be today, if back in 2007 network operators forced smartphone makers to operate in a certain way, because it's better for the "ecosystem" and because network operators know what's in the best interest for consumers?In this case, VIPPS is just forcing its way in (with the help of the EU) without needing to make any concessions at all. Think back to how Apple used leverage to sell music for the iPod, then to block carrier meddling for the iPhone, and now this. Ultimately, the DMA is an attack on Apple's integration and the superior user experience that tends to result as a result of this vertical integration, and this forum seems pretty convinced (or is at least hoping) that the theoretical promise of competition will result in banks (of all businesses!) creating a better consumer experience than Apple.
Who gets to pick which companies only have the best interest of the consumer in mind when they integrate vertically and use their dominance and leverage to change the marketplace to their advantage?
Just because Apple tended to make decisions that aligned with our interests, does not mean that this will be true going forward.
Which was precisely what carriers did back then (not just the US ones). Notice how android phones are somehow always the ones with come with a ton of preinstalled apps and carrier bloatware out of the box, or signed the user up for half a dozen services that were not very easy to cancel at all, or had software updates blocked because carriers couldn't be bothered to process them? While the iPhone came all clean and pristine out of the box, and you were always assured of updates on day 1 without issue.
And Apple was able to break the carriers' hold over smartphones by famously refusing to compromise on the user experience, even when it meant the iPhone initially not being on Verizon (the then dominant carrier in the US). Instead, Apple went all in with AT&T, who were losing in market share and therefore more willing to compromise in terms of branding and user experience, and so Apple was able to launch the iPhone on AT&T on their specifications.
The rest as we know it is history. Apple controlled the user experience of the iPhone, which led to people willing to switch carriers to own one, which in turn gave Apple more power and more leverage. Eventually, even Verizon had to agree to the exact deal they had initially rejected in 2007, because they were bleeding subscribers to AT&T. The unwavering loyalty of iPhone users gave them little choice in this matter.
Apple would then repeat this playbook in other countries. Insistence on total control, marketing investments, guaranteed number of units sold, all because Apple was willing to go with the second or even third largest carrier if need be (eg: Softbank in Japan saw a 50% growth in market share in 2008 after agreeing to carry the iPhone, but on Apple's terms). All because Apple had a loyal user base who cared more about owning an iPhone than they did about which carrier they were on.
And we were better off for it.
In an ideal market, the customer. Which is precisely what we have done, when we voted with our wallets to make Apple one of the most successful companies in the world, in spite of their minority market share in all the industries that they operate in.
If being closed and restrictive and having fewer options and being unable to sideload apps was such a massive turn off, users and app developers alike should have abandoned iOS long ago and fled to Android. That Apple still commands the lion's share of profits in this market shows that tight integration can lead to a superior user experience that consumers can "feel" and appreciate and which therefore matters enough for them to be willing to pay a premium for.
Why do Sony and Nintendo and Valve have the success that they do? The Switch and PS5 too have closed app ecosystems that take 30% from developers. You can't sideload apps or run emulators (readily) or install third party app stores (like Epic), yet developers still actively seek them out (and I don't see Tim Sweeney complain about this). Same goes for the Steam App Store. PC gamers are free to download games from the web directly (which would allow developers to keep 100% of revenue, minus payment processing fees), yet users prefer the superior experience that Steam provides, which in turn means that game developers have to sell through Steam (and pay Steam their cut) or not sell at all.
This integration, IMO, is worth protecting.
And users are free to move to Android if and when they feel that Apple no longer meets their needs or if the user experience is no longer special or "good enough".
And why could Apple get a foothold in the smartphone market? Because there was competition among network operators and because there were standards that made it possible to make an interoperable phone.
Apple is the network operator today. The only one in town by the way. They try to dictate how other businesses should operate.