Apple counters Australian banks' call for iPhone NFC access, cites handset security

Posted:
in iPhone
Rebuking overtures from Australia's big-three banks looking to break in on Apple Pay's success, Apple in a letter to the Australian Competition and Consumer Commission this week said requests for access to iPhone's digital wallet technology would fundamentally undermine the handset's security safeguards.




Apple went further in its three-page letter to the ACCC, likened the three banks -- Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corp -- to a cartel that wants to suppress new, potentially disruptive financial market innovations, reports The Australian Financial Review.

In July, Australia's three biggest lenders filed an ACCC application seeking approval to collectively negotiate the installation of third-party digital wallets on iPhones. Currently, Apple restricts touchless NFC payments to its in-house Apple Pay solution, a limitation the company says is meant to protect consumers.

"Apple upholds very high security standards for our customers when they use Apple devices to make payments," Apple said in its statement to the ACCC. "Providing simple access to the NFC antenna by banking applications would fundamentally diminish the high level of security Apple aims to have on our devices."

For their part, the banks claim compatibility with third-party digital wallet software will give consumers choice beyond Apple Pay, adding that Apple's single-source solution amounts to anticompetitive behavior.

Apple's letter asserts much the same, but in reverse.

"Unfortunately, and based on their limited understanding of the offering, the [banks] perceive Apple Pay as a competitive threat," Apple's statement reads. "These banks want to maintain complete control over their customers. The present application is only the latest tactic employed by these competing banks to blunt Apple's entry into the Australian market."

Interestingly, the document was signed by Marg Demmer, a former executive at ANZ Banking Group. In April, ANZ became the first major Australian bank to break rank and ink a deal to bring Apple Pay to its customers, a decision that drove a 20 percent increase in online credit card and deposit account applications.

Apple continues to negotiate with Australia's banks in light of the proposed Apple Pay boycott. Apple said it needs support from the big-three institutions in order to roll out Apple Pay on a "meaningful" basis, but the company appears to be facing an uphill battle.
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Comments

  • Reply 1 of 61
    kevin keekevin kee Posts: 1,136member
    So the three major banks would like to have Apple Pay for themselves while on the same time refusing Apple Pay to use their services. I understand that all business want profits, but if by "any methods necessary" means jeopardizing the consumer's security (and we're talking their money here) AND neglecting the consumer's choice to use ApplePay by forcing their own products (using Apple Chip while throwing out Apple Pay token tech), I think there is a big problem here - in which does not lie on Apple side.
    ronnrobertwaltertopper24hourslolliverjahbladejbdragonDan Andersenlostkiwibadmonk
  • Reply 2 of 61
    gtrgtr Posts: 3,231member
    After perusing the statements from both sides and much reflective, deliberate, and thoughtful consideration I have come to the following conclusion:

    F*ck the f*cking banks.
    edited August 2016 Deelronzeus423ronnlatifbppscooter63ericthehalfbeejony0damonfwaverboycreek0512
  • Reply 3 of 61
    mattinozmattinoz Posts: 1,148member
    Not a good day for any Australian Organisation to make the claim "Trust us" we are doing this you the Consumer/Citizen. 
    Deelronlatifbpdamonfjbdragonlostkiwibadmonk
  • Reply 4 of 61
    prokipprokip Posts: 150member
    If you live in Australia, everyone knows that the Big 4 banks are just outrageous bastards.  Stick it to em Apple.  Up your, boys !
    latifbpEsquireCatsrobertwalteranantksundaramjbdragonDan Andersenbadmonk
  • Reply 5 of 61
    cnocbuicnocbui Posts: 3,613member
    kevin kee said:
    So the three major banks would like to have Apple Pay for themselves while on the same time refusing Apple Pay to use their services. I understand that all business want profits, but if by "any methods necessary" means jeopardizing the consumer's security (and we're talking their money here) AND neglecting the consumer's choice to use ApplePay by forcing their own products (using Apple Chip while throwing out Apple Pay token tech), I think there is a big problem here - in which does not lie on Apple side.
    The banks are not proposing to force their customers to do anything.  They want to be able to offer  Apple Pay alternatives.  How would the banks proposals jeopardize their customers security? They seem to manage to handle AU$2 Billion in contactless payments a week in Australia without the sky falling down: http://www.smh.com.au/business/retail/110bn-australias-contactless-boom-20160805-gqmg7j.html

    singularity
  • Reply 6 of 61
    The big four Australian banks are absolutely cartel thugs. Commonwealth just posted $7.1billion USD profit for the year. The other three aren't far behind. The Commonwealth bank never leads with new products. They only respond when they absolutely have to. The profit of Australia banks are almost 3% of GDP. 
    Its great ANZ broke ranks, there is hope yet. 
    ronnsennenEsquireCatsrobertwalterlolliveranantksundaramjbdragonDan Andersenlostkiwi
  • Reply 7 of 61
    latifbplatifbp Posts: 544member
    cnocbui said:
    kevin kee said:
    So the three major banks would like to have Apple Pay for themselves while on the same time refusing Apple Pay to use their services. I understand that all business want profits, but if by "any methods necessary" means jeopardizing the consumer's security (and we're talking their money here) AND neglecting the consumer's choice to use ApplePay by forcing their own products (using Apple Chip while throwing out Apple Pay token tech), I think there is a big problem here - in which does not lie on Apple side.
    The banks are not proposing to force their customers to do anything.  They want to be able to offer  Apple Pay alternatives.  How would the banks proposals jeopardize their customers security? They seem to manage to handle AU$2 Billion in contactless payments a week in Australia without the sky falling down: http://www.smh.com.au/business/retail/110bn-australias-contactless-boom-20160805-gqmg7j.html

    Says the Euro-turd supporter
    apple ][stevehjony0lolliverpacificfilmjbdragonnolamacguybestkeptsecret
  • Reply 8 of 61
    Gee, who do I trust ...... Apple, which refuses to invade / monetize my privacy, or these parasitic, thieving bankers? Tough call ...not! 
    loquiturdamonfEsquireCatsmattinozrobertwalterlollivercintoslatifbpanantksundaramjbdragon
  • Reply 9 of 61
    sirlance99sirlance99 Posts: 1,157member
    kevin kee said:
    So the three major banks would like to have Apple Pay for themselves while on the same time refusing Apple Pay to use their services. I understand that all business want profits, but if by "any methods necessary" means jeopardizing the consumer's security (and we're talking their money here) AND neglecting the consumer's choice to use ApplePay by forcing their own products (using Apple Chip while throwing out Apple Pay token tech), I think there is a big problem here - in which does not lie on Apple side.
    The don't want to use Apple Pay, they want to use the NFC. Apple pay is Apple Pay. It's not the Apple chip as Apple doesn't have exclusive rights to it because it's a standard NFC. It's also not Apple Pay token tech as all NFC payment's use the same standard token tech. 

    I'm not siding with the banks here but you're making it sound as if Apple owns all rights to the NFC payment's token tech, which they do not.
    cnocbuisingularity
  • Reply 10 of 61
    bigbig Posts: 36member
    I realize this article refers to something happening in Australia, but based on what happened less than a decade ago in USA with the pathological banking system that nearly destroyed the economy and did destroy countless lives, I have nothing but mistrust, disgust, and contempt for banks. Furthermore, some comments above would indicate that the Aussie banks are no better! I hope Apple wins this one! And if they can't win it, I'd say it's not worth them doing business there.
    robertwalterJanNLjbdragonDan Andersenlostkiwibadmonk
  • Reply 11 of 61
    I hate the aussie banks with their outrageous profits gained by rorting customers with ridiculous fees rather than actually providing a good service or product. They have never put the customer first. I want Apple Pay but only if it comes directly from Apple. I will never use an aussie bank app instead, even if it uses the same technology.
    lolliverbadmonk
  • Reply 12 of 61
    dunksdunks Posts: 1,247member
    I did the sensible thing and moved my banking over to ANZ. I literally set up Apple Pay an hour ago.
    robertwalterlolliverjahbladelostkiwibrakkenbadmonk
  • Reply 13 of 61
    Looking at the existing options from the likes of commbank, it's quite clear consumer security isn't high on the list. Any access to NFC would result in the banks typical bumbling efforts to produce a minimally-working model that neither supported recent security advancements nor held any meaningful advantage to the consumer - the banks want one thing, for everything to stay the same so they can keep being the MOST PROFITABLE CONSUMER BANKS IN THE WORLD.
    robertwalterDan Andersenlostkiwibadmonk
  • Reply 14 of 61
    sennensennen Posts: 1,466member
    kevin kee said:
    So the three major banks would like to have Apple Pay for themselves while on the same time refusing Apple Pay to use their services. I understand that all business want profits, but if by "any methods necessary" means jeopardizing the consumer's security (and we're talking their money here) AND neglecting the consumer's choice to use ApplePay by forcing their own products (using Apple Chip while throwing out Apple Pay token tech), I think there is a big problem here - in which does not lie on Apple side.
    The don't want to use Apple Pay, they want to use the NFC. Apple pay is Apple Pay. It's not the Apple chip as Apple doesn't have exclusive rights to it because it's a standard NFC. It's also not Apple Pay token tech as all NFC payment's use the same standard token tech. 

    I'm not siding with the banks here but you're making it sound as if Apple owns all rights to the NFC payment's token tech, which they do not.
    Apple, whatever fingers it may want to have in the pie, is still providing the most secure solution for it's customers. I'll take that over whatever service Australia's banks want to push onto me.
    robertwalterlolliverlostkiwibadmonk
  • Reply 15 of 61
    I opened an ANZ Visa on the day of launch 3 months back and have only pulled an actual card out of my wallet about 3 times since then. I love Apple Pay on the Apple Watch.

    The other 3 big banks have requested from the ACCC 3 YEARS to work together as a cartel to negotiate against Apple. 

    For those of you waiting, for CommBank, Westpac, NAB to get ApplePay, it's 2 weeks before the ACCC gives it's interim decision. Then I think another 5 months before it will give it's 'considered' decision. Then, if they say 'Yes', do we really think Apple will open up their NFC before they are good and ready? And would you expect, when you hold a locked iPhone up to an EFTPOS terminal that it's going to open a banks app or it's going to open the Apple Wallet app? If the ACCC say 'no', I wonder if the banks would stall on ApplePay out of pride. They could just cave immediately but we're still talking at least 5.5 months away. 

    I encourage you not to wait. I don't work for ANZ, I'm a fan of ApplePay and I think the banks stalling on it should be made to feel the pain of customers switching for it. I can't wait till a huge number of people are using mobile as wallets and putting pressure on other companies to make their cards digital (i.e. Driver Licence). 


    iwoodlandlolliverJanNLDan Andersenlostkiwibadmonk
  • Reply 16 of 61
    dagazdagaz Posts: 15member
    I am an Aussie and an Apple user. In Australia Samsung users have the option of using the Banks' contactless system through NFC or using Samsung Pay. Apple users have the option of neither of these (unless with ANZ) because Apple won't let the banks access the NFC (which is standard practice everywhere else) or demand that banks pay them 18c for every $100 in transaction, more than double what they are charged by Visa and Mastercard. There is no reason that Apple won't let the banks use the NFC except Apple want complete control over it - which is their right, but is not good for us as consumers.
    croprcnocbui
  • Reply 17 of 61
    lolliverlolliver Posts: 356member
    douglas bailey said:
    I encourage you not to wait. I don't work for ANZ, I'm a fan of ApplePay and I think the banks stalling on it should be made to feel the pain of customers switching for it. I can't wait till a huge number of people are using mobile as wallets and putting pressure on other companies to make their cards digital (i.e. Driver Licence). 


    I agree. For anyone who is currently with one of the other three big banks and wants to use ApplePay you should make the switch to ANZ now. I still have my mortgage with my previous bank at the moment but set up an ANZ account to use for ApplePay. The very small amount of trouble I had to go to in order to set it up (can all be done online in minutes) has more than paid off in being able to use ApplePay for the last few months.

    The more people who make the switch the bigger message it will send to the banks that they have to provide the services the consumers want and not just doing what is best for their bottom line.
    Dan Andersenlostkiwibadmonk
  • Reply 18 of 61
    lolliverlolliver Posts: 356member
    dagaz said:
    I am an Aussie and an Apple user. In Australia Samsung users have the option of using the Banks' contactless system through NFC or using Samsung Pay. Apple users have the option of neither of these (unless with ANZ) because Apple won't let the banks access the NFC (which is standard practice everywhere else) or demand that banks pay them 18c for every $100 in transaction, more than double what they are charged by Visa and Mastercard. There is no reason that Apple won't let the banks use the NFC except Apple want complete control over it - which is their right, but is not good for us as consumers.


    Correction - It's great for us as consumers. I don't want to have to unlock my phone and open a banking app before I can pay for something. The ApplePay solution allows me to make a payment from the lock screen by simply holding my thumb on the Home button. Why would I want the banks to come up with their own more convoluted method when Apple already provides what I want. These three banks don't care about what's best for the consumer, they care about what's best for them.

    radarthekatDan Andersenlostkiwibadmonk
  • Reply 19 of 61
    kevin keekevin kee Posts: 1,136member
    sirlance99 said:
    kevin kee said:
    So the three major banks would like to have Apple Pay for themselves while on the same time refusing Apple Pay to use their services. I understand that all business want profits, but if by "any methods necessary" means jeopardizing the consumer's security (and we're talking their money here) AND neglecting the consumer's choice to use ApplePay by forcing their own products (using Apple Chip while throwing out Apple Pay token tech), I think there is a big problem here - in which does not lie on Apple side.
    The don't want to use Apple Pay, they want to use the NFC. Apple pay is Apple Pay. It's not the Apple chip as Apple doesn't have exclusive rights to it because it's a standard NFC. It's also not Apple Pay token tech as all NFC payment's use the same standard token tech. 

    I'm not siding with the banks here but you're making it sound as if Apple owns all rights to the NFC payment's token tech, which they do not.
    It is true that Apple Pay token tech is not unique among NFC payments, but the combination of token and touch-id security distinguish it from others. Apple will not taking further risk by giving the banks away the complete control of their security system (remember the FBI case), not even Apple can touch the secure chip within.

    dagaz said:
    I am an Aussie and an Apple user. In Australia Samsung users have the option of using the Banks' contactless system through NFC or using Samsung Pay. Apple users have the option of neither of these (unless with ANZ) because Apple won't let the banks access the NFC (which is standard practice everywhere else) or demand that banks pay them 18c for every $100 in transaction, more than double what they are charged by Visa and Mastercard. There is no reason that Apple won't let the banks use the NFC except Apple want complete control over it - which is their right, but is not good for us as consumers.
    People often misunderstood that Apple Pay is only NFC chip. What Apple protect here is their implementation of transaction or surprise, consumer's security. If you read how Apple Pay works, Apple has no access to transaction whatsover. Bank still keeping the controls of all transaction and tokenization. Apple simply play as a conduit, but a very secure conduit, compare to Samsung Pay. Which is why I stated, by giving away that particular control to bank, Apple is jeopardizing consumer's security, not something that Apple design Apple Pay for.
    edited August 2016 frantisekrob53anantksundarammelodyof1974Dan Andersen
  • Reply 20 of 61
    I believe this is a technical limitation. The main reason Apple Pay is reasonably secure is that it stores its private secrets in a non-read section of memory in the secure enclave, which is really just a JavaCard chip made by NXP. When I say non-read, I mean the phone cannot ask the secure enclave "tell me the Apple Pay secret." Instead, it says "please sign this request from the payment terminal with the Apple Pay secret." Big difference. Now, there is very limited memory in that secure enclave (think kilobytes), probably enough to put maybe 3 to 10 different payment solutions programs, called applets, on it. So until NXP starts making chips with alot more memory in them, Apple has a solid argument in my opinion.
    edited August 2016 latifbpbadmonk
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