April 3, 2015
As a child, I would often see science fiction movies depict watches that weren’t only watches. These devices allowed the users to contact friends, make video-calls, summon bat-mobiles, and transform themselves into crime fighting power rangers. I watched in awe as my favorite heroes used these devices in ways I couldn’t fathom, and waited for the day that these watches would exist outside of science fiction. Well, that day is now, as a wave of smartwatches washes over the market that can in fact execute many of these functions—with the exception of the bat-mobile and power ranger abilities. Within this emerging market, three companies seem to be making big moves towards integrating mobile payments into their watches.
Apple’s new smartwatch is set to hit stores April 24th. Prices will start at $549, with the base specifications being a 38mm or 42mm watch face, stainless steel or space black case, a heart rate sensor, accelerometer, gyroscope, and of course, NFC. The watch will support connectivity with iPhone 5, 5c, 5s, 6, and 6 plus models. Apple has made Apple Pay integration on the watch convenient and simple—A double click of the side button will allow the user to switch between cards and make contactless payments. Security wise, the watch has a few very comforting features. All payment information is stored within the Secure Element chip, and whenever the watch is removed from the user’s wrist, a password input is necessary to access Apple Pay again.
Android has taken a slightly different approach as compared to Apple; instead of releasing a single, customizable watch, whose price varies depending on optional amenities, Android has instead released a smartwatch OS dubbed Android Wear. This is a similar approach seen to Android’s mobile phone OS. Off the bat, Android had released six watch models for purchase. Unfortunately, these early watches were not NFC enabled, but that didn’t stop companies from using them for payments. Here are two mobile payment implementations based on Android Wear:
This isn’t to say the Android wear doesn’t support NFC at all. An increasing number of manufacturers are releasing Android Wear compatible smartwatches that are NFC enabled. LG is releasing its highly anticipated LG Urbane LTE watch, Sony has released its SmartWatch 2 SW2, and Broadcom has released a smartwatch platform available to companies to use to create their own watches. All of these examples possess NFC capabilities. Android Pay also inherently supports NFC, along with biometric authentication. Unlike Apple Pay, Android Pay doesn’t exist independently as its own app (it seems Google learned its lesson after Google Wallet). Instead, it is an API, which holds the payment information in a similar way to Apple Pay that can be implemented into developers’ apps for different methods of payments. Hopefully this will allow for more Android Pay enabled Android Wear apps.
Samsung has released a line of smartwatches by the name of Gear to accompany its GalaxyTM smartphones. Of the four models already on the market, three have NFC capabilities. Patents for a new Samsung Gear phone have also been released, revealing plans to integrate bio-signal authentication through EMG (electromyogram) & ECG/EKG (electrocardiogram). This is a big step up from Apple Watch’s security, but what about Samsung’s mobile payment system? In an effort to compete with Apple and Android, Samsung recently announced Samsung Pay. It will include all the features we have come to expect from mobile payment applications, such as biometric security and NFC compatibility—the works. What makes it special is the implementation of MST, a technology that simulates a card swipe through magnetic induction. This acts as a sort of backwards compatibility for mobile phone payments, allowing for an initiall t6y larger base of compatible POS’s—but it’s a double edged sword, as it also possess all of the Magstripe technology’s shortcomings. This could provide a huge boost initially for Samsung Pay, but compatibility for Samsung Gear has yet to be announced.
(Sources: CNET; Apple, Android, Samsung)