April 22, 2014
We know that Apple has taken slow definitive steps in Payments over the last year. According to a new post from Recode, this time Apple is extremely serious about their ambitions and has been in talks with various payment industry experts as part of its plan.
Apple has been interviewing senior payments industry executives to push ahead on a plan to build an electronic payments business, according to two people familiar with the process. The company has been meeting with potential applicants for two new positions at Apple focused exclusively on building a business around the hundreds of millions of credit cards it already has on file, wrote the website. Jennifer Bailey, Apple’s long-time e-commerce head, has met with candidates and is currently leading the initiative, according to these sources.
Read our post on - History of Apple in Mobile Payments, WIP for years, So much headway to just connect the dots. There are more than 100 Apple patents that can be related to the strides Apple is making and will make in payments.
Some Recent news that sent the techpress haywire: According to analyst Ming-Chi Kuo, Apple is planning to debut two new iPhone models with two distinct screen sizes in 2014, an unprecedented move for the company that traditionally shies away from screen size wars. A near-field communications chip (NFC) and metal casing are also part of the build.
Apple has also considered acquiring Square, according to Recode, and such a deal would have helped Apple quickly establish a network of retailers to begin using its service.
Some interesting Forecasts Related to Apple and Payments:
NFC phone shipment forecast: NFC enabled phone shipments are expected to grow at 37% CAGR from 256 million sets in 2013 to 1,235 million sets in 2018.This is driven by strong growth in smart phone sales in APAC. APAC is expected to remain the largest market with more than 50% of NFC enabled shipments in 2018. For APAC, penetration of NFC enabled phone in overall smart phone market is expected to increase from 20% in 2013 to 56% in 2018. EMEA is expected to remain the second largest market with 26% shipment share in 2018, followed by Americas with 22% share.
Impact if Apple includes NFC in iPhone 6: Overall growth in NFC shipments will top 42%+ CAGR and in terms of sheer numbers could cross even 1400 million sets in 2015. Americas will have an even bigger shipment share than 22% (current) driven by the USA.
NFC POS installed base forecast (Prior to BLE impact): NFC POS installed base is expected to grow from 6.6 million in 2013 to 44 million by 2018, growing at CAGR of 48%. Growth is expected to be driven by increased adoption in EMEA with, share of NFC enabled POS installed base as a % of total POS installed base, is expected to grow from 11% in 2013 to ~80% in 2018. APAC already has significant NFC POS installed base in China and Japan. Japan has largest number of NFC enabled POS (>1 Million) in the world. As a result, growth is expected to be marginally lower than EMEA. NFC enabled POS installed base is expected to grow at 47% in Americas and is expected to be close to 10 million units in 2018.
Impact if Apple includes NFC in iPhone 6 and iWatch: NFC enabled POS would grow at more than 60% CAGR at least in the Americas. US alone would drive global growth upwards of 44 million NFC enabled POS by 2018 worldwide. Much higher than the current estimates.