This week a dispute between retailers and tech companies around the country has been all over the news.
In late October, Apple released a service called Apple Pay, which utilizes NFC technology within new Apple products so a customer can pay a retailer with the phone.
NFC, or near-field communication, and functions much like a WiFi router does, only on a different wavelength that is much less powerful, and for a good reason.
The NFC chips installed on Apple’s products are only meant to transmit a short distance (or the distance one would hold their phone from an NFC reader at a store) to ensure secure transmission of sensitive data.
In this case, data being transmitted through the Apple Pay service consists of a time-sensitive token which will charge credit or debit account when the token is used.
In this way, the retailer does not ever receive any account information, only the transferrable token from Apple Pay.
This is a safer service than even using one’s own credit card or debit card, as that information is retained after transactions, and is subject to being stolen if the retailer is hacked, like in past cases with Target and Home Depot. Google provides a similar service.
A union of companies called Merchant Customer Exchange (MCX), led by large companies such as Walmart, Target, CVS and Best Buy, however, has a competing service, called CurrentC. CurrentC is meant to also be used at numerous retailers and utilize one’s phone, but instead of the close proximity NFC technology, it would instead use a QR code which would be scanned.
Regardless of its ease of use compared to Apple Pay and Google Wallet (reviews indicate it is “clunky,”) MCX has made a point to indicate to the retailers under its organization that they disallow NFC readers, thus preventing Apple Pay or Google Wallet, or wait until their contract under MCX.
Some retailers have even started to remove the NFC readers they had already installed (riding on the heels of the news of Apple Pay). Obviously, this is to promote and butt out competition for its service, CurrentC.
Regardless of your intention to use Apple Pay, it should be noted that the move by MCX that is distinctly anti-consumer, and merely limits the options that consumers have to pay for their products. In the process, MCX is also being very anti-competitive in its business practices.
If anybody has an Apple or Google smartphone, they should be concerned about how other companies are hurting their ability to use their phones in the ways they want.