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"Apple (AAPL, Tech30) gets just 15 cents for every $100 in Apple Pay transactions, according to Gillis."[1] In addition to the minor surcharge, there is the (o

by oneJob 11y ago

"Apple (AAPL, Tech30) gets just 15 cents for every $100 in Apple Pay transactions, according to Gillis."[1] In addition to the minor surcharge, there is the (opportunity) cost of Apple's hardware, the costs to vendors of supporting (yet) another platform, the consumer provides value to Apple in the form of consumer information, the consumer now has their fingerprint tied to payments, and then there is everything that goes along with the terms and conditions. Regarding the security, I'm not sure what the details are, but it seems that the attack surface is increased substantially. I'd personally prefer to have Visa, AmEx, etc reviewing and resolving fraud and other claims, seeing as how they've been doing it for decades and their bottom line depends on it, whereas Apple is relatively new to the game and Apple's bottom line does not depend on it. Apple Pay might be awesome. Idk. But it's not "just a nice frontend for Visa, AmEx, etc., with better security". [1]http://money.cnn.com/2015/01/26/technology/apple-pay/ http://money.cnn.com/2015/01/26/technology/apple-pay/

joebolte 11y ago
You are very misinformed about Apple Pay, and the poster you are replying to is correct. CC networks pay the Apple Pay surcharge, not customers or vendors. To vendors, Apple Pay looks like a regular NFC transaction, except with a one-time card number, so there is no danger of the kind of hacks that happened to Target, Home Depot, and many other retailers. Apple has nothing at all to do with "reviewing and resolving fraud and other claims." The CC networks still do this.
- oneJob 11y ago
  When I buy a burrito and then look at a receipt (as I always do after buying a burrito) I do not see the visa surcharge, or any others. I see tax but that's it. At the end of the day, the consumer pays, because there is no free lunch, there are no free burritos. I may have made an incorrect assumption regarding claims handling, though I'm not sure how that translates me to being "very misinformed". I wasn't speaking only from the vendor perspective (idk what it looks like to them) or the Apple Pay customer's perspective (I'm not one of their customers) but I highly doubt it's worth my time to research to confirm that adding Apple Pay into the mix does not somehow increase the attack surface or how it does not somehow increase the amount of my personal information that is with Apple.
  - mikeash 11y ago
    Nearly everything in your original comment is wrong. You say there's a "minor surcharge" but the cost to the vendor is the same as any other credit card. You mention the cost of supporting yet another platform, but the platform is just NFC, there's nothing special needed to support Apple Pay specifically. You say the consumer has their fingerprint tied to payments, but the fingerprint data never leaves the device. You say the attack surface is increased substantially, but Apple Pay is much more secure than using a credit card directly. (Not that consumers need to care, since fraud protection is 100%.) You imply that credit card companies aren't involved in resolving fraudulent Apple Pay transactions, but they are. You close by saying that Apple Pay isn't just a nice frontend for the card companies with better security, but that's precisely what it is. I personally think this can rightly be described as "very misinformed."
    - Litaph1 11y ago
      >> there's nothing special needed to support Apple Pay specifically. Yes, there is. NFC enabled terminals may be the norm at major chain stores but they do not have widespread adoption in smaller retail outlets. The merchant pays for those terminals and they are not inexpensive. Sometimes $1000 or more. That tradeoff (making it slightly easier for you to pay) just isn't worth it to most merchants right now. As EMV adoption grows and merchants have to update their terminals to support that as well, NFC will grow. Also, it may seem as if ApplePay is more secure for the banks as it prevents issues with data breaches but to date, it has not prevented any, will continue to only lessen the impact and is absolutely wrought with card fraud as there isn't any validation that you own the card you are loading into ApplePay. Once it's loaded it isn't checked by the merchant (if the merchant even pays attention these days) and is implicitly trusted by the network.
      - Symbiote 11y ago
        It took the UK a few years since contactless cards were launched around 2010. Everyone already had chip+pin terminals, and at first it was mostly coffee shops in London, but now many merchants have upgraded to contactless ones. It's not just national chains, but local shops too. It's much faster paying by contactless in a busy pub than paying cash. It's possible there's pressure/support from Visa and MasterCard for small, local retailers to accept contactless payments. It's part of their advertising that you can buy a newspaper using the system, and most newsagents are local, independent shops. A basic chip+pin (not contactless) terminal is available for £100 (or £3/month), I can't find a price for a contactless one.
cballard 11y ago
> the consumer now has their fingerprint tied to payments FUD. This is not how Touch ID works. Fingerprint data, which is not a fingerprint image to begin with, more of a hash, is stored on the iPhone's A_ chip itself. It cannot leave the device, ever. Other posters have addressed the remainder of your incorrect claims.
- oneJob 11y ago
  I was not under the impression that Apple Pay users have an imprint of their finger print next to the transaction information and time and date stamp somewhere. That would be ridiculous. If the user validates a transaction using their fingerprint, somewhere it probably say something along the lines of "verified with user's fingerprint, which is not stored here." This creates what we call, linkages. It's not all in one place. That would, again, be ridiculous. But, the more linkages you have the better picture you can draw.
  - jonknee 11y ago
    If you authorize your transactions with a PIN or a signature you're doing the same thing, but in a much less secure manner.

by oneJob 11y ago

joebolte 11y ago

You are very misinformed about Apple Pay, and the poster you are replying to is correct. CC networks pay the Apple Pay surcharge, not customers or vendors. To vendors, Apple Pay looks like a regular NFC transaction, except with a one-time card number, so there is no danger of the kind of hacks that happened to Target, Home Depot, and many other retailers. Apple has nothing at all to do with "reviewing and resolving fraud and other claims." The CC networks still do this.

oneJob 11y ago
When I buy a burrito and then look at a receipt (as I always do after buying a burrito) I do not see the visa surcharge, or any others. I see tax but that's it. At the end of the day, the consumer pays, because there is no free lunch, there are no free burritos. I may have made an incorrect assumption regarding claims handling, though I'm not sure how that translates me to being "very misinformed". I wasn't speaking only from the vendor perspective (idk what it looks like to them) or the Apple Pay customer's perspective (I'm not one of their customers) but I highly doubt it's worth my time to research to confirm that adding Apple Pay into the mix does not somehow increase the attack surface or how it does not somehow increase the amount of my personal information that is with Apple.
- mikeash 11y ago
  Nearly everything in your original comment is wrong. You say there's a "minor surcharge" but the cost to the vendor is the same as any other credit card. You mention the cost of supporting yet another platform, but the platform is just NFC, there's nothing special needed to support Apple Pay specifically. You say the consumer has their fingerprint tied to payments, but the fingerprint data never leaves the device. You say the attack surface is increased substantially, but Apple Pay is much more secure than using a credit card directly. (Not that consumers need to care, since fraud protection is 100%.) You imply that credit card companies aren't involved in resolving fraudulent Apple Pay transactions, but they are. You close by saying that Apple Pay isn't just a nice frontend for the card companies with better security, but that's precisely what it is. I personally think this can rightly be described as "very misinformed."
  - Litaph1 11y ago
    >> there's nothing special needed to support Apple Pay specifically. Yes, there is. NFC enabled terminals may be the norm at major chain stores but they do not have widespread adoption in smaller retail outlets. The merchant pays for those terminals and they are not inexpensive. Sometimes $1000 or more. That tradeoff (making it slightly easier for you to pay) just isn't worth it to most merchants right now. As EMV adoption grows and merchants have to update their terminals to support that as well, NFC will grow. Also, it may seem as if ApplePay is more secure for the banks as it prevents issues with data breaches but to date, it has not prevented any, will continue to only lessen the impact and is absolutely wrought with card fraud as there isn't any validation that you own the card you are loading into ApplePay. Once it's loaded it isn't checked by the merchant (if the merchant even pays attention these days) and is implicitly trusted by the network.
    - Symbiote 11y ago
      It took the UK a few years since contactless cards were launched around 2010. Everyone already had chip+pin terminals, and at first it was mostly coffee shops in London, but now many merchants have upgraded to contactless ones. It's not just national chains, but local shops too. It's much faster paying by contactless in a busy pub than paying cash. It's possible there's pressure/support from Visa and MasterCard for small, local retailers to accept contactless payments. It's part of their advertising that you can buy a newspaper using the system, and most newsagents are local, independent shops. A basic chip+pin (not contactless) terminal is available for £100 (or £3/month), I can't find a price for a contactless one.

cballard 11y ago

> the consumer now has their fingerprint tied to payments FUD. This is not how Touch ID works. Fingerprint data, which is not a fingerprint image to begin with, more of a hash, is stored on the iPhone's A_ chip itself. It cannot leave the device, ever. Other posters have addressed the remainder of your incorrect claims.

oneJob 11y ago
I was not under the impression that Apple Pay users have an imprint of their finger print next to the transaction information and time and date stamp somewhere. That would be ridiculous. If the user validates a transaction using their fingerprint, somewhere it probably say something along the lines of "verified with user's fingerprint, which is not stored here." This creates what we call, linkages. It's not all in one place. That would, again, be ridiculous. But, the more linkages you have the better picture you can draw.
- jonknee 11y ago
  If you authorize your transactions with a PIN or a signature you're doing the same thing, but in a much less secure manner.