Tim Cook was in a defiant mood yesterday addressing the rejection of Apple Pay by a group of major US retailers.
Speaking at The Wall Street Journal’s Global Technology Conference in California, Cook referred to the incident as a “skirmish” in the bigger battle to become the world’s dominant mobile payment service.
He also announced that over one million credit cards were activated within 72 hours of Apple Pay going live, making it the world’s largest point-on-sale mobile payment service. Growing animated, Cook added: “We’re already number one, and not just number one, but we’re more than the total of all the other guys, and we've only been at it a week, so I feel fantastic.”
The CEO was speaking after US retailers CVS and Rite Aid had stopped using Apple Pay technology. The two pharmacy chains are part of a larger coalition called the Merchant Customer Exchange (MCE) who are developing their own mobile payment service. This group includes other major retailers such as Wal-Mart and Best Buy.
Apple remains confident that their system will come out on top. Apple Pay has already reached agreement with the six biggest issuers of credit cards in the US. Credit cards issued by these companies account for 83 percent of all credit card transactions in the US. Apple is also signed up all three of the major credit card networks: Master Card, Visa and American Express.
Although he expects Apple Pay to grow significantly, Cook stated that the company believes that the iPhone will account for the largest stake of the company’s revenue in the next three to five years.
The Apple Pay service currently has plenty of advantages over the other companies hoping to establish themselves as the number one mobile payments provider. Apple is offering the hardware, software and services as a cohesive package. In the US 42 percent of smart phone users are currently using iPhones.
Since the iPhone 5 all Apple phones make use of figure print security technology. This safety feature makes the combined use of Apple phones and the mobile payment service all the more appealing for customers as it is more secure than payment methods which use passwords.
The Merchant Customer Exchange group offering has been dubbed CurrentC. Its advantages would be an obvious relationship with major US retailers but it is not without its downsides. While the Apple payment system will confirm purchases with a finger print scan, CurrentC’s validation process is a bit more complicated. It is understood that it will involve opening the CurrentC application and taking a photo of a QR code.
A developmental version of CurrentC app is currently available in Apple’s App Store in the US. The app has been a target of consumer anger since the announcement regarding Apple Pay. Angry Apple users have been giving the app one star reviews and leaving negative comments.
CurrentC is only targeting the US domestic market while Apple has its sights set on becoming the number one global mobile payment service. Tim Cook also discussed Apple's intentions to establish Apple Pay in the Chinese e-payments market, and the possibility of a partnership with China's biggest e-commerce company Alibaba to help it bring the payment system to the country.
