How Apple Pay highlights ALL that is wrong with the App ecosystems

So last week Apple Pay launched in the UK on a wave of hype, the Usual Suspects were interviewed on now simple it was to use to buy coffee and travel on The Tube and now disruptive it was; using just an iPhone or your iWatch. To watch the reports the mobile phone was finally going to replace your wallet doing away with the need for plastic payment cards and finally mobile payments were going to take off after years of false dawns.

But hang on Apple Pay only works on Apple Hardware and quite a few people I see out in public don't have an iPhone preferring to have an Android device. Also there is an issue with just what banks payment services are available at this moment as not all card issuers are set up on Apple Pay. So far nobody I have seen has spoken about how Apple Pay will allow the user to ditch their wallet as  with this version of the App it allows only one card to be associated with the service at any time.  But hang on the thing it seeks to replace has more than one payment card and so rather than a replacement at present the service is an alternative as most wallets are see have six plus cards in.

The first week of use, judging by my twitter stream seems to be users explaining how those in retail did not know that you can pay by phone or the service failing to work as the EPOS didn't confirm payment and so they are having to revert to traditional contactless cards.

Rivals to Apple are now promoting that they have or will have there own App that allows the user to do just the same and so you can add that to Apple Pay on your phone or remove and replace it.

What we are not told is that the service is not a full replacement for Internet Banking, the lack of interface with Payment Service Providers means that it will not allow you to confirm account balances, review all transactions on your account or make direct payments.  These services should be available and they potentially could be very secure however the Banks and Mobile Networks are at a standoff as to pricing such interactions.  The Banks wish to pay the Mobile Networks 0.0001p per transaction, The Mobile Networks want 5p per transaction because the massive volumes make it necessary to invest in more infrastructure.  Given that the Banks charge retailers over 50p per transaction it does seem that the Banks are attempting to rip of the Networks, but then I would say that because I work for MNOs rather than Banks.

Why should be accept such a limited service in a mobile payment app? I want something that allows me to replace cheque writing at the start of every school term with a simple system that allows me to send money by text.  It's not difficult Africa and Asia have had such services for years now.

Does Apple have a roadmap that means they will upgrade the services as volumes increase and users demand more features or will Apple Pay be a service like visual voicemail a flash in the pan that is quietly killed off?  Apps are not the disruptive innovation a journalist will have you believe they are compromises because infrastructure for different markets does not have the ability to talk to one another and the owners of the different systems demand so form of entry fee.

New steps in M-Payments

Total Telecom reports that the Italian Post Office's MVNO will have a number of Payment services available in an effort to distinguish itself from it carrier Vodafone.

Thus we finally have a Western European network looking to offer customers replacement of paper money and coins. The Italian Banking environment is still what underdeveloped compared to most with a number of regional banks rather than National banks when it comes to the retail sector and so the Post Office is still a major player when it comes to payments. This makes the target of 2M subscribers look somewhat conservative. Perhaps they need to take a leaf out of Tesco's book and look to grow more aggressively?

I hope that they are successful, and I hope that the GSMA take note and start to back M-Payments for the benefit of the Market rather than a get rich quick scheme as the seem to be with the present remittance based approach. Perhaps if they engaged with consultants that know the payments market rather than Blue Chip accountants they would be more flexible and finally manage to develop Mobile Payments. But that is unlikely and this has all the hallmarks of the dotmobi plan to "get rich quick" rather than aid the market!

Another organisation that could do with some Consulting help is Transport for London who are pushing ahead with a trial of NFC based handsets from Nokia on the O2 network. Whilst I support the movement of my Oyster Card onto my handset I do not think that the use of the UK network with the worst billing system will be an effective proof of concept. The Independent today writes about the trial; something the Guardian did on Monday. This is the second trial that I know of, a very small test took place in the summer with some 200 people using handsets I hope that this one will be bigger. I would also have hopes that they tested on the other networks to see how the billing systems function there both Pre and Post-Paid.

UPDATE: The press release has now been sent out and what 500 lucky O2 customers can now expect is the use of a Nokia handset for the next six months whilst they trial  the system.  Thus we have no great leap forward, rather we can expect another small step.  

I wonder if the move will force the  other networks to open up mobile payments or if we can 
expect to have to wait before we  have open access. The good news is that it's not expected to work on an iPhone!