Apple Pay under scrutiny by EU for possible anti-competitive payment practices

Posted:
in General Discussion edited December 2019
European Union antitrust investigators have begun asking payment companies for feedback on Apple Pay, potentially signaling the launch of an investigation into anti-competitive practices.

Apple Pay scrutinized by EU for anti-competitive payment practices


The European Union has once again turned a critical eye toward Apple. This time, their main focus is on Apple Pay. The European Commission is concerned that Apple's choice to limit Apple's built-in Near-Field Communication chip to Apple Pay makes it impossible for third-party companies to break into the mobile payment market.

In an attempt to gather more information prior to the launch of a formal investigation, EU antitrust investigators have begun asking payment companies for feedback on Apple Pay, according to MLex.

Some banks and rival payment services have claimed that these restrictions make alternative payment services less attractive.

Apple has argued that limiting access to the NFC chip provides tighter security, especially when handling sensitive banking data. They also argue that this is one of the reasons consumers choose Apple Pay in the first place.

EU competition commissioner Margrethe Vestager has said she is aware that Apple had been limiting access to the iPhone's NFC chip. She points out that other companies, such as Google and Samsung, have not triggered a probe. This is because smartphones running Android operating systems allow all payment apps access to the device's NFC chip.

In December, Apple had settled a complaint with a Swiss payment company, TWINT, to avoid such a probe.

Australian banks had also taken issue with Apple Pay for similar reasons, but ultimately resulted in them backing down and adopting Apple Pay support.

Apple is still in the midst of another anti-trust probe regarding their self-preferential practices, centered largely around their long-running spat with Spotify.
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Comments

  • Reply 1 of 40
    These stupid thumb-twiddlers who can't innovate to save their asses, going after US tech again...

    Payments now. Pathetic. And ridiculous.
    chaickajbdragond_2SpamSandwichberndogtmayrazorpitlkruppbshankGG1
  • Reply 2 of 40
    banks: we can’t rip off our customers, punish them for tapping on another bank’s terminal, and make their lives complicated

    apple:

    gov: thank you for the lovely lunch, it is just terrible how apple is making it harder for you to give me and my friends invites to lunch as often.
    kuraibeowulfschmidtchiawatto_cobra
  • Reply 3 of 40
    chaickachaicka Posts: 238member
    Just withdraw Apple Pay service from those markets. Let’s sit back and watch how things turn out.
    agilealtitudeberndograzorpitbshankcornchipanantksundaram
  • Reply 4 of 40
    jbdragonjbdragon Posts: 2,246member
    If I have to load up some other company app so that I can then pay using it and NFC, why bother? I just want to hold the phone over the terminal, or for my mostly my Watch and BAM, just pay. So if Apple opened NFC access up for others in this area, it changes nothing.

    Now if Apple opened it up for other type of things, great. This is typical EU sticking there nose into yet another American Company to steal more money. Seems the EU just can't innovate on their own. I guess it's rolling back to Apple's turn once again.

    Here's a idea, you BANKS go out and release your own phone for people to buy and do whatever YOU want with your own product!! Oh wait, you want someone else to do all the word, and Innovate and spend tons on R&D and then just benefit from it.
    edited October 2019 d_2razorpitbshankwatto_cobrawonkothesane
  • Reply 5 of 40
    sergiozsergioz Posts: 338member
    Of course EU would say that! Also love the black theme on AppleInsider! 
    watto_cobra
  • Reply 6 of 40
    larryjwlarryjw Posts: 834member
    Does it seem that when Apple gets it right, after everyone else has failed, they get hit with anti-competition investigations?


    JustAnotherLonelyVoicerazorpitbshanklolliverwatto_cobra
  • Reply 7 of 40
    g3.g3. Posts: 2member
    These stupid thumb-twiddlers who can't innovate to save their asses, going after US tech again...

    Payments now. Pathetic. And ridiculous.
    Limiting usage of NFC for 3rd parties is clearly anti-competition behavior. It’s like to say you will use only Safari at your iPhone because of security. It will not go like that forever. It can’t. Apple is just milking NFC payments and keep all generated on iPhone for themselves. 
    More to say, apple pay didn’t improve “payment culture” in Europe much. When US was using swipe and sign, EU was doing chip and pin payments (more secure) and contactless payments were pretty common long before apple pay. In general, acquiring and payment services as such are more developed in EU - that’s for the innovations.
    Main point is that Apple is really limiting developers to make use of NFC and deliver additional services on top of apple pay...
    hydrogenavon b7darkvaderxyzzy01
  • Reply 8 of 40
    These dummies are the ones who’ve kept Apple Pay OUT OF THEIR MARKETS. They’re the ones who have used protectionism to prevent competition.
    cornchipanantksundarammonstrositywatto_cobra
  • Reply 9 of 40
    g3. said:
    These stupid thumb-twiddlers who can't innovate to save their asses, going after US tech again...

    Payments now. Pathetic. And ridiculous.
    Limiting usage of NFC for 3rd parties is clearly anti-competition behavior. It’s like to say you will use only Safari at your iPhone because of security. It will not go like that forever. It can’t. Apple is just milking NFC payments and keep all generated on iPhone for themselves. 
    More to say, apple pay didn’t improve “payment culture” in Europe much. When US was using swipe and sign, EU was doing chip and pin payments (more secure) and contactless payments were pretty common long before apple pay. In general, acquiring and payment services as such are more developed in EU - that’s for the innovations.
    Main point is that Apple is really limiting developers to make use of NFC and deliver additional services on top of apple pay...
    Then EU should stick to chip and pin. They dont have to get apple pay....nobody is twisting them to use apple pay
    razorpitanantksundaramwatto_cobra
  • Reply 10 of 40
    kuraikurai Posts: 16unconfirmed, member
    If Apple is forced to open up NFC, they do have the ability to design an API and rules (via App Review) to continue to protect customer privacy. Additionally, they could enforce a quid pro quo via that API with entities, like banks, to ensure that Apple Pay support needs to be added before their apps/payment methods can be enabled. These are two areas, privacy and customer choice, that the EU wouldn't push back on.
    darkvader
  • Reply 11 of 40
    g3. said:
    These stupid thumb-twiddlers who can't innovate to save their asses, going after US tech again...

    Payments now. Pathetic. And ridiculous.
    Limiting usage of NFC for 3rd parties is clearly anti-competition behavior. It’s like to say you will use only Safari at your iPhone because of security. It will not go like that forever. It can’t. Apple is just milking NFC payments and keep all generated on iPhone for themselves. 
    More to say, apple pay didn’t improve “payment culture” in Europe much. When US was using swipe and sign, EU was doing chip and pin payments (more secure) and contactless payments were pretty common long before apple pay. In general, acquiring and payment services as such are more developed in EU - that’s for the innovations.
    Main point is that Apple is really limiting developers to make use of NFC and deliver additional services on top of apple pay...
    Well, if Apple didn’t improve much then why are you saying it’s anti-competitive behavior? That doesn’t make sense to me. Are you arguing that the EU is making a poor choice in investigating Apple limiting NFC? Since contactless payment was common before Apple Pay then what’s the issue? Can’t people and companies just continue to do what they did before Apple Pay was available?
    chiarazorpitSpamSandwichlarryjwlollivercornchipanantksundaramwatto_cobra
  • Reply 12 of 40
    tjwolftjwolf Posts: 398member
    g3. said:
    These stupid thumb-twiddlers who can't innovate to save their asses, going after US tech again...

    Payments now. Pathetic. And ridiculous.
    Limiting usage of NFC for 3rd parties is clearly anti-competition behavior. It’s like to say you will use only Safari at your iPhone because of security. It will not go like that forever. It can’t. Apple is just milking NFC payments and keep all generated on iPhone for themselves. 
    More to say, apple pay didn’t improve “payment culture” in Europe much. When US was using swipe and sign, EU was doing chip and pin payments (more secure) and contactless payments were pretty common long before apple pay. In general, acquiring and payment services as such are more developed in EU - that’s for the innovations.
    Main point is that Apple is really limiting developers to make use of NFC and deliver additional services on top of apple pay...
    You're entitled to an opinion, of course, but to me there's a difference between "anti-competitive behavior" and "anti-competitive" side effects.  Apple's mantra on the iPhone has always been security/privacy.  The company - and the customers who buy its products - believe that the integration of hardware and software and the careful curation of access to this hardware/software leads to a safer product.  That's why Apple has always insisted on a single App Store - and has always limited access to its chips, including the NFC chip.  Yes, this decision has the effect of limiting or not allowing "competition", but that's the whole point - Apple and its customers believe 3rd-party alternatives in those areas will decrease the security of the whole system.

    The EU and large software developers can bitch and moan about this "anti competitive" arrangement, but they really don't have a stool to stand on.  First of all, the moaners could simply ignore the Apple platform - after all, Android has 90% of the market - so simply limit your payment system to Android!  Same with large software vendors tired of Apple's 30% cut.  If you don't like it, don't develop for it!  But they don't want to do that because its a much more lucrative platform than Android.

    Apple has always been up front with everything it offers.  Nobody forced people to buy their phones and nobody is forcing s/w or payment companies to be on Apple's platform.  The EU (or any other entity) has the right to retroactively tell Apple how it should design its products or platforms.
    stompychiacornchipanantksundaramwatto_cobra
  • Reply 13 of 40
    uraharaurahara Posts: 585member
    I am from EU. And I am ashamed of this news. WTF, really. 
    Let’s sue Visa for not offering AmEx in the Their service list. /s Or if Apple wouldn’t be offering NFC, would they be anti-competitive because they didn’t provide the tech at all?
    How is it anticompetitive? Every company wants to build and hold some level of competitive advantage. And this is very competitive!
    Just to give everyone a free lunch is anti-competitive. 
    EU needs to stimulate the entrepreneurship more! Not this: you are earning money - you are automatically bad. 

    This is unacceptable. 
    We need EU commissioner Margrethe Vestager  to resign!
    JWSCchiaSpamSandwichGG1lollivercornchipanantksundaramwatto_cobra
  • Reply 14 of 40
    uraharaurahara Posts: 585member
    g3. said:
    These stupid thumb-twiddlers who can't innovate to save their asses, going after US tech again...

    Payments now. Pathetic. And ridiculous.
    Limiting usage of NFC for 3rd parties is clearly anti-competition behavior. It’s like to say you will use only Safari at your iPhone because of security. It will not go like that forever. It can’t. Apple is just milking NFC payments and keep all generated on iPhone for themselves. 
    More to say, apple pay didn’t improve “payment culture” in Europe much. When US was using swipe and sign, EU was doing chip and pin payments (more secure) and contactless payments were pretty common long before apple pay. In general, acquiring and payment services as such are more developed in EU - that’s for the innovations.
    Main point is that Apple is really limiting developers to make use of NFC and deliver additional services on top of apple pay...
    Apple spends money to build NFC into iPhones. I would say it’s just wrong to request them to give it away go free. 
    If I build a house, I am not going to keep the door open so that everyone could stay overnight. At least I will be taking money for that. But... that would limit the developers....
    lolliveranantksundaramwatto_cobra
  • Reply 15 of 40
    g3. said:
    Limiting usage of NFC for 3rd parties is clearly anti-competition behavior. It’s like to say you will use only Safari at your iPhone because of security. It will not go like that forever. It can’t. Apple is just milking NFC payments and keep all generated on iPhone for themselves. 
    More to say, apple pay didn’t improve “payment culture” in Europe much. When US was using swipe and sign, EU was doing chip and pin payments (more secure) and contactless payments were pretty common long before apple pay. In general, acquiring and payment services as such are more developed in EU - that’s for the innovations.
    Main point is that Apple is really limiting developers to make use of NFC and deliver additional services on top of apple pay...
    As long as these banks will let Apple, and anyone else, make a debit card for their accounts. I mean a direct debit card that takes from the accounts directly without the bank being involved.... heck, let me make a debit card for other customers if I want. That will improve the "payment culture" in Europe. And that would in no way be abused.
    Or is that not an option because of security?

    cy_starkmananantksundaram
  • Reply 16 of 40
    gatorguygatorguy Posts: 23,174member
    tjwolf said:
    g3. said:
    These stupid thumb-twiddlers who can't innovate to save their asses, going after US tech again...

    Payments now. Pathetic. And ridiculous.
    Limiting usage of NFC for 3rd parties is clearly anti-competition behavior. It’s like to say you will use only Safari at your iPhone because of security. It will not go like that forever. It can’t. Apple is just milking NFC payments and keep all generated on iPhone for themselves. 
    More to say, apple pay didn’t improve “payment culture” in Europe much. When US was using swipe and sign, EU was doing chip and pin payments (more secure) and contactless payments were pretty common long before apple pay. In general, acquiring and payment services as such are more developed in EU - that’s for the innovations.
    Main point is that Apple is really limiting developers to make use of NFC and deliver additional services on top of apple pay...
    after all, Android has 90% of the market - so simply limit your payment system to Android!  
    Only if you include the forked non-Google Android versions used by all the OEM's in China, and more sparingly but still frequently used in other areas worldwide. Even then the split isn't quite that high.
  • Reply 17 of 40
    jcs2305jcs2305 Posts: 1,216member
    g3. said:
    These stupid thumb-twiddlers who can't innovate to save their asses, going after US tech again...

    Payments now. Pathetic. And ridiculous.
    Limiting usage of NFC for 3rd parties is clearly anti-competition behavior. It’s like to say you will use only Safari at your iPhone because of security. It will not go like that forever. It can’t. Apple is just milking NFC payments and keep all generated on iPhone for themselves. 
    More to say, apple pay didn’t improve “payment culture” in Europe much. When US was using swipe and sign, EU was doing chip and pin payments (more secure) and contactless payments were pretty common long before apple pay. In general, acquiring and payment services as such are more developed in EU - that’s for the innovations.
    Main point is that Apple is really limiting developers to make use of NFC and deliver additional services on top of apple pay...
    Limiting NFC usage on it's own devices is not the same as a web browser? What next the EU will demand Apple load chrome and Firefox on their devices to make things fair for competition ?  Stop with this nonsense..

    Also on that note I personally only use safari on my Devices because of the exact reason you mention.. Security, as well as speed and working across all of my devices. Same goes for using Apple pay on my Apple device.. I do so because I trust the security.

    There are a ton of other phones available that allow for different payment options via NFC or magnetic secure transmission if that is an option you need.  iPhone isn't the only phone sold in the EU.
    chialolliveranantksundaramwatto_cobra
  • Reply 18 of 40
    g3. said:
    Main point is that Apple is really limiting developers to make use of NFC and deliver additional services on top of apple pay...
    I used my Apple Wallet to pay for my Car Charging today using NFC/RFID and TouchID. The app wasn't supplied by a bank or other financial services company but the Charger Operator, 'chargepoint'. To me, that seems as if the app has access to not only the RFID subsystem and possily at least part of the secure enclave.
    If that is correct then what is stopping others from doing the same? It isn't ApplePay (or is it? I don't know)
  • Reply 19 of 40
    g3.g3. Posts: 2member
    tjwolf said:
    g3. Limiting usage...
    You're entitled to an opinion, of course, but to me there's a difference between "anti-competitive behavior" and "anti-competitive" side effects.  Apple's mantra on the iPhone has always been security/privacy.  The company - and the customers who buy its products - believe that the integration of hardware and software and the careful curation of access to this hardware/software leads to a safer product.  That's why Apple has always insisted on a single App Store - and has always limited access to its chips, including the NFC chip.  Yes, this decision has the effect of limiting or not allowing "competition", but that's the whole point - Apple and its customers believe 3rd-party alternatives in those areas will decrease the security of the whole system.

    The EU and large software developers can bitch and moan about this "anti competitive" arrangement, but they really don't have a stool to stand on.  First of all, the moaners could simply ignore the Apple platform - after all, Android has 90% of the market - so simply limit your payment system to Android!  Same with large software vendors tired of Apple's 30% cut.  If you don't like it, don't develop for it!  But they don't want to do that because its a much more lucrative platform than Android.

    Apple has always been up front with everything it offers.  Nobody forced people to buy their phones and nobody is forcing s/w or payment companies to be on Apple's platform.  The EU (or any other entity) has the right to retroactively tell Apple how it should design its products or platforms.
    I got your point. It’s about where you see the line of integration of sw and hw. If you could withhold some services to yourself or not and when its damaging consumer because of monopoly practices. I don’t believe that NFC would be any security risk for ios if opened. But that is my opinion. If you keep it closed, than on top of fees for card associations, issuer and acquirer you also have fee for apple. On all levels of the chain there is a competition (VISA, MC, banks...) except just introduced tech companies... apple wont let anybody there and I understad why. of course take it or leave it, but apple base of hooked users is just too big and gives him huge bargain power. I don’t agree much with other stuff what is EU doing but in this case I’m not sure if they are looking for the easy buck.
    one more thing... its not just about apple pay, but also other non payment services that can use NFC chip.

    To other comments: Contactless payments (NFC) was in EU before apple pay and terminals were pretty common. Which made the adoption much smoother than in the us where nfc terminals were not available that much... apple pushed retailers to get them/ accelerated the adoption. So i guess for US consumers it was big move forward. On the other hand in europe people got used to contactless cards long before and they keep using them even if you can use apple pay. Apple pay is basicaly emulating card and encrypting the data/communication - ok better, i can have slimmer wallet.
  • Reply 20 of 40
    g3. said:
    These stupid thumb-twiddlers who can't innovate to save their asses, going after US tech again...

    Payments now. Pathetic. And ridiculous.
    Limiting usage of NFC for 3rd parties is clearly anti-competition behavior. It’s like to say you will use only Safari at your iPhone because of security. It will not go like that forever. It can’t. Apple is just milking NFC payments and keep all generated on iPhone for themselves. 
    More to say, apple pay didn’t improve “payment culture” in Europe much. When US was using swipe and sign, EU was doing chip and pin payments (more secure) and contactless payments were pretty common long before apple pay. In general, acquiring and payment services as such are more developed in EU - that’s for the innovations.
    Main point is that Apple is really limiting developers to make use of NFC and deliver additional services on top of apple pay...
    Me: let me add a bolt and a few locks to my store’s doors and windows FOR MY SECURITY and to keep my business safe, and thieves out
    EU: that is anti-competitive because it doesn’t allow other store owners to use your store to sell their stuff
    Me: *slap forehead*
    chiaanantksundarambshank
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