Australia considers requiring Apple to support Apple Pay rivals
An Australian committee has heard arguments from Apple, Google, and others regarding the opening up of iPhone NFC payment systems to more than just Apple Pay.
Apple Pay
As the European Union has considered forcing Apple to open up its contactless payment technology, so Australia is hearing arguments for and against the same issue. On Monday, an Australian Parliamentary committee heard from Apple, Google, and more.
According to ZDNet, Apple argued that security is the reason iPhone does not support alternatives while Android does. It also said in a written response to the Parliamentary Joint committee on Corporations and Financial Services, that Apple Pay "is available to all banks in Australia on fair and non-discriminatory terms."
"Contrary to some claims in some of the submissions [by rivals], Apple provides banks with access to NFC functionality on Apple devices," it continued. "Apple has developed a technical architecture that comprises hardware and software components and application programming interfaces (APIs) that banks can use to facilitate contactless payments with their cards and mobile banking applications."
"Apple chose to call this architecture Apple Pay... because it allowed Apple to market the service to consumers without having to preference one bank over another," said Apple's response.
"Apple chose a unique architecture to differentiate itself from Android by enabling consumers to easily switch between cards issued by different banks whilst still supporting contactless payments from third party apps and enabling non-payment uses of NFC technology (such as car keys and transit cards)," said the company. "Apple's pro-competitive technical architecture provides consumers and merchants with greater choice, supporting cards and use cases from thousands of providers."
The written response points out that Apple's system is hardware based, using the Secure Element on the iPhone. By contrast, Apple says that the software-based Host Card Emulation (HCE) is less secure.
Google reportedly denies this, and it also refutes Apple's claim that Apple Pay presents a simpler, clearer experience for users.
"Our payments apps are immensely secure," Diana Layfield, Google president of partnerships in the EMEA region, said in a presentation to the committee. "[Our] HCE system, which is used by a very large number of banks all around the world, is audited directly by the banks... [We] would refute the suggestion our HCE environment is in any way insecure."
"I would argue the user experience on Google Pay is equal to that of Apple Pay," she continued.
The committee is continuing to consider the arguments.
Read on AppleInsider
Apple Pay
As the European Union has considered forcing Apple to open up its contactless payment technology, so Australia is hearing arguments for and against the same issue. On Monday, an Australian Parliamentary committee heard from Apple, Google, and more.
According to ZDNet, Apple argued that security is the reason iPhone does not support alternatives while Android does. It also said in a written response to the Parliamentary Joint committee on Corporations and Financial Services, that Apple Pay "is available to all banks in Australia on fair and non-discriminatory terms."
"Contrary to some claims in some of the submissions [by rivals], Apple provides banks with access to NFC functionality on Apple devices," it continued. "Apple has developed a technical architecture that comprises hardware and software components and application programming interfaces (APIs) that banks can use to facilitate contactless payments with their cards and mobile banking applications."
"Apple chose to call this architecture Apple Pay... because it allowed Apple to market the service to consumers without having to preference one bank over another," said Apple's response.
"Apple chose a unique architecture to differentiate itself from Android by enabling consumers to easily switch between cards issued by different banks whilst still supporting contactless payments from third party apps and enabling non-payment uses of NFC technology (such as car keys and transit cards)," said the company. "Apple's pro-competitive technical architecture provides consumers and merchants with greater choice, supporting cards and use cases from thousands of providers."
The written response points out that Apple's system is hardware based, using the Secure Element on the iPhone. By contrast, Apple says that the software-based Host Card Emulation (HCE) is less secure.
Google reportedly denies this, and it also refutes Apple's claim that Apple Pay presents a simpler, clearer experience for users.
"Our payments apps are immensely secure," Diana Layfield, Google president of partnerships in the EMEA region, said in a presentation to the committee. "[Our] HCE system, which is used by a very large number of banks all around the world, is audited directly by the banks... [We] would refute the suggestion our HCE environment is in any way insecure."
"I would argue the user experience on Google Pay is equal to that of Apple Pay," she continued.
The committee is continuing to consider the arguments.
Read on AppleInsider
Comments
"Apple Pay "is available to all banks in Australia on fair and non-discriminatory terms."
Non-discriminatory to banks as long as Apple gets a cut.
That makes it 'discriminatory' for users as they have only one option: Apple Pay.
That is why my wife refuses to use it.
Apple is probably being deliberately obtuse on this one.
Let's see how governments rule on it.
Also not sure what your issue is with Apple getting a cut. Do you have an issue with credit card companies getting a cut?
Also, US banks reported the fraud savings was more than the fee to support Apple Pay.
early on, when chip cards were just coming out in the U.S. I asked my bank which I should use. They told me to use Apple Pay because it was the safest. That was enough for me.
My wife exercises that right of hers but it doesn't change the fact that Apple is closing off a technology that could easily be used by other competitors.
That is what the whole piece is about.
We'll see what happens.
The Australian government may well have legal rights to force Apple to open up.
As a self enclosed platform Apple is on solid ground. The second it opens the door and sticks a toe out of it, things change. As can be observed here.
Apple cannot make a cent out of Apple Pay without first dealing with the banks. They are sitting well out of Apple land. Different operational rules may apply here.
We'll have to see how different investigations play out.
Internet payments are totally irrelevant here. It's about NFC hardware. That's as far away as you can get from online payments.
In the EU particularly things have moved ahead very quickly.
In Spain for example, I believe signature authentication was phased out years ago.
My banking app gives me absolute control over my cards. I can suspend and reactivate them at a touch of a button. I'm informed of every transaction that goes through.
Someone recently tried to open an account using my brother's ID information. That was thwarted by the bank simply communicating with him over a secure channel to confirm it with him.
PSD2 is being implemented across the board (although Amazon and some others seem to have wangled an exception), adding another layer of security to online purchases, although mine go through a virtual card anyway that doesn't have money on it until I 'charge' it.
the organisation that makes those gets a cut of every transaction as well.
Using Safari for online payments has nothing to do with NFC.