It's hard to believe the iPhone 6 was released nearly three months ago.
Apple is finally getting into the mobile payments arena after years of sitting on the sidelines. With more than 500 million iPhones already in circulation, the company is no stranger to payments made within its closed iTunes ecosystem. Apple Pay now offers mobile payment features at other online and retail stores, which could revolutionize the shopping landscape.
The company has partnered with the major credit cards and most large banks to begin offering contactless payments using near field communication (NFC) technology. In addition, Apple's iBeacons could allow mobile payments to happen through Bluetooth Low Energy (BLE) — a new technology whose data signal reaches 150 feet.
But will Apple's mobile payments really change the industry?
No one can say for certain — not even Apple. But the company has a number of advantages that other mobile payment providers lack, including:
1. Large User Base
Apple already has over 800 million iTunes users with pre-existing, registered credit cards linked to the store. Tapping into this user base represents a huge opportunity as Apple transitions into mobile payments. These are customers who are already primed and ready. Even if the company can only leverage 10 percent of these numbers, that's still 80 million new mobile payment users.
2. Flawless Execution
Google wallet already exists, as do other mobile payment technologies offered jointly by AT&T, Verizon and T-Mobile (e.g. ISIS Mobile Payments). But these payment options have enjoyed relatively limited success — largely due to technical glitches and diminished consumer confidence.
By contrast, Apple has a fairly solid track record for new product launches (GPS maps and antenna issues aside). The company invests heavily in R&D to ensure seamless integration with pre-existing software and hardware within its product line. In fact, this might explain why Apple has delayed mobile payments for so long — it wanted its execution to be 100 percent flawless.
3. Industry Trendsetter
Although Apple may not be a pioneer in mobile payments, it usually sets the pace in all other aspects of entertainment, technology and telecommunications. With each new product release, the company places the bar very high, forcing others to play catch-up.
So even if mobile payments don't excite consumers, it's fairly likely that payment providers, software developers and mobile manufacturers are taking note. In fact, it was probably iPhone 6 mobile payment rumors that prompted Amazon to release its own smart phone.
What Does All This Mean for You?
In 2012, mobile payments totaled $163 billion. By the end of 2013, that number had jumped to $235 billion. The technology is clearly on the rise, and Apple will almost certainly play a pivotal role in speeding up mobile payment adoption worldwide.
It’s worth looking into updating your payment infrastructure so that you can ride this global trend — rather than playing perpetual catch-up. For more information, be sure to read Mobile Payments at BluePay.