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Apple Announces Apple Pay (Yahoo search) September 09, 2014 02:45 PM Eastern Daylight TimeTransforming Mobile Payments with an Easy, Secure & Private Way to PayCUPERTINO, California―September 9, 2014―Apple? today announced Apple Pay?, a new category of service that will transform mobile payments with an easy, secure and private way to pay. Apple Pay works with iPhone? 6 and iPhone 6 Plus through a groundbreaking NFC antenna design, a dedicated chip called the Secure Element, and the security and convenience of Touch ID?. Apple Pay is easy to set up, so hundreds of millions of users can simply add their credit or debit card on file from their iTunes Store? account. Apple Pay will also work with the newly announced Apple Watch?, extending Apple Pay to over 200 million owners of iPhone 5, iPhone 5c and iPhone 5s worldwide. Apple Pay supports credit and debit cards from the three major payment networks, American Express, MasterCard and Visa, issued by the most popular banks including Bank of America, Capital One Bank, Chase, Citi and Wells Fargo, representing 83 percent of credit card purchase volume in the US.* In addition to the 258 Apple retail stores in the US, some of the nation’s leading retailers that will support Apple Pay include Bloomingdale’s, Disney Store and Walt Disney World Resort, Duane Reade, Macy’s, McDonald’s, Sephora, Staples, Subway, Walgreens and Whole Foods Market. Apple Watch will also work at the over 220,000 merchant locations across the US that have contactless payment enabled. Apple Pay is also able to make purchases through apps in the App Store?.“Security and privacy is at the core of Apple Pay.” When you’re using Apple Pay in a store, restaurant or other merchant, cashiers will no longer see your name, credit card number or security code, helping to reduce the potential for fraud,” said Eddy Cue, Apple’s senior vice president of Internet Software and Services. “Apple doesn’t collect your purchase history, so we don’t know what you bought, where you bought it or how much you paid for it. And if your iPhone is lost or stolen, you can use Find My iPhone to quickly suspend payments from that device.”Apple Pay will change the way you pay. When you add a credit or debit card with Apple Pay, the actual card numbers are not stored on the device nor on Apple servers. Instead, a unique Device Account Number is assigned, encrypted and securely stored in the Secure Element on your iPhone or Apple Watch. Each transaction is authorized with a one-time unique number using your Device Account Number and instead of using the security code from the back of your card. Apple Pay creates a dynamic security code to securely validate each transaction. “JPMorgan Chase has been pleased to collaborate on Apple Pay to create a better, faster and safer payments system, which puts the customer first, creating an exceptional customer experience for consumers and merchants. Everyone wins,” said Jamie Dimon, chairman and CEO, JPMorgan Chase & Co.“We’re providing our customers with tools to make their financial lives better, including our 30 million digital banking customers,” said Brian Moynihan, CEO of Bank of America. “For them, better means simple and convenient. Apple Pay is another exciting move in that direction.”“Apple Pay is the kind of innovative thinking that brings the worlds of online and offline commerce closer together,” said Ken Chenault, CEO of American Express. “We’re excited to work with Apple to offer Card Members and merchants a simple and secure way to make purchases in stores and on apps.”Online shopping in apps with iPhone is also as simple as the touch of a finger. Users can pay for physical goods and services including apparel, electronics, health and beauty products, tickets and more with Touch ID. Checkout can happen with a single touch, so there’s no need to manually fill out lengthy account forms or repeatedly type in shipping and billing information, and card details are kept private and are not shared with the online merchant. For example, quickly order grill accessories for a backyard BBQ from the Target app, easily request a ride with Uber without having to create an account first or avoid the lunch line by using Rapid Pick-Up and paying ahead in the Panera Bread app. Simply make your selection and when ready to buy, use Apple Pay to complete the transaction.Starting in October, with iPhone 6 and iPhone 6 Plus, Apple Pay will be available in the US as a free update to iOS 8. Apple Pay will work in stores with iPhone 6, iPhone 6 Plus and Apple Watch. Apple Pay APIs will be available to developers in iOS 8 so they can enable purchasing physical goods within their apps on iPhone 6 and iPhone 6 Plus.*American Express, Bank of America, Capital One Bank, Chase, Citi and Wells Fargo at availability with additional banks coming quickly thereafter including Barclaycard, Navy Federal Credit Union, PNC Bank, USAA and U.S. Bank.Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App Store, and is defining the future of mobile media and computing devices with iPad. 2. In summary, Apple Pay is the kind of innovative thinking that works on mobile devices using near-field communication technology (NFC) .Apple Pay supports credit and debit cards from the three major payment networks, American Express, MasterCard and Visa, issued by the most popular banks the United States including Bank of America, Capital One Bank, Chase, Citi and Wells Fargo. The concept is to be able to make payment at stores with mobile device, and then use Touch ID to complete the purchases; thus, protecting the 16 digit credit card details. Cashiers will no longer see your name, credit card number or security code, helping to reduce the potential for fraud. It can be deduced from this article that “Security and privacy” is at the core of Apple Pay.”3. Apple Pay and The New World of Mobile Digital Credit Cards (Search engine: Google search) CITATION Nat14 \l 1033 (Nat Kerris, Business Wire)Amid the extravaganza of the Apple Watch and iPhone product launch this week, Apple also unveiled Apple Pay – a new mobile digital payment system, which is being touted by some as death for the “plastic” credit card. By registering your MasterCard, Visa, and American Express cards to your Apple Pay wallet through iTunes, you will be able to use your Apple mobile phones to make easy and secure mobile payments to merchants.The payment system uses a one-time transaction-specific dynamic security code –meaning your actual credit card number never gets transferred to the merchant and reduces the chance of fraud. Lots of information around implementation remains to be seen. However, the Apple pay system does boast early support by major credit card companies and banks.Apple is using short-range radio waves technology known as NFC (near-field communication), in both its smart watch and the new iPhones in support of the application. NFC has been a feature in many other smartphones (including by Google) but has failed to take hold to date. Market researcher Gartner, estimated NFC was used for just 2% of total mobile payments last year, though expected to nearly double to $8.2 billion this year. Up until now, analysts say banks couldn’t see a business case for NFC instead of simply issuing their own smart cards.Smart cards aka EMV cards (an acronym for Europay MasterCard and Visa) are revamped credit cards with microchips that store your data on the card. This approach also limits the retailer from holding your data; data resides on your card and the embedded microprocessor chip encrypts transaction data differently for each purchase.The catch with the chip cards, until now, is that most retailers don’t have the technology for them yet…But that is also expected to change quickly. Wal-Mart is already there. Major retailers like Target and Home Depot have announced plans to roll out the EMV payment systems. I just received replacement Amex card with the EMV technology.(BTW, in other related news, Home Depot revealed this week that its payment systems had been hacked, possibly compromising customer data over its 2,000+ outlets in the U.S and Canada. This is potentially a bigger data breach than the one that unfortunately befell Target last December.) USATODAY 3:24 p.m. EDT September 10, 2014“Will Apple Pay be safer than credit cards?” (Search engine: Bingo search engine)Apple hopes to jump-start mobile payments with Apple Pay. Apple Pay is meant to replace your wallet with something that's both easier to use and more secure. As Apple CEO Tim Cook told an auditorium of fans in Cupertino, Calif., on Tuesday, "We're totally reliant on the exposed numbers and the outdated and vulnerable magnetic stripe." To move away from "this little piece of plastic" as Cook called credit cards, Apple Pay uses a proprietary payment system that creates a one-time payment number for each purchase. It all happens on the iPhone 6. Users need only wave or touch their phone near a reader, then input a PIN or their fingerprint. That makes Apple Pay more secure than today's credit cards because it's effectively the same two-step chip-and-PIN credit card system that Europe and Canada already use, said Rob Sadowski, Director of Technology Solutions for security company RSA. Chip-and-PIN cards contain a computer chip with encrypted financial information on them. For each sale, the chip generates a one-time authorization code. Payment can't move forward unless it is authorized by the user, who inputs a PIN. Considered safer than having the information encoded on the magnetic strip on the back of a credit card, chip and PIN cards are supposed to be rolled out in the United States by 2015. A physical card doesn't need to be handed over because data about the transaction is transmitted from the phone to the point-of-interaction using a near-field communications (NFC) antenna built into the top of the new models. NFC is a set of standards that allows phones to talk to each other by radio when they are either right next to each other — no more than an inch or so apart — or touching. However, users needn't worry they might bump into a reader and suddenly find they've bought a new television, said Ed McLaughlin, chief emerging payment officer for MasterCard. "It won't work unless you validate it — you say yes, you want this transaction to happen — either with your PIN or your fingerprint," he said. That means cash registers could be a thing of the past. "You'll be able to buy in the aisle," said McLaughlin. If a phone is stolen, users don't have to worry that the thief could go on a spending spree, Cook said. The same technology that allows a user to track or shut down a wandering phone can also be used to shut down Apple Pay. In addition, crooks can't get at the financial information that Apple Pay uses because it's stored on what Apple terms a "secure element" on the phone. That's a special area of secure encrypted storage controlled by the phone's operating system, said Sadowski. "It would only be available to certain trusted applications and not readable by normal apps or someone who stole the phone," he said. Because a credit card is never handed over, the store clerk never sees the shopper's name, address or financial information. Taking the clerk out of the transaction closes one gap, "but if there's anything we've learned it's that introducing a new technology generally shifts the attack somewhere else," said Geoff Webb, with computer security company NetIQ in Houston. All of these things might make the iPhone 6 more secure, but security experts are not known for their Pollyanna-ish outlooks. It still won't be perfect, said Tom Gorup, security operations center manager with Rook Security, Indianapolis-based security consulting company.” Attackers and researchers will poke and prod at this implementation until a hole is found," he said.After running my search words ("apple pay mobile technology credit card security & privacy") on the two search engines above, I strongly believe Bing search engine is better than the Google search engine. The Bing search engine produced 43,900,000 results based on my search word; on the other hand, the Google search engine gave 37,800,000 results. However, they both offer their best result but Bing offered a wider range of results. 4. TRAAPTime: The first article above (Apple Pay and The New World of Mobile Digital Credit Cards) was written on Friday September 12, 2014. The second article (“Will Apple Pay be safer than credit cards?”) was written 3:24 p.m. EDT Wednesday September 10, 2014; however, but articles hasn’t been updated yet.Relevance: They’re both related to the topic and also very relevant, they both talked about the innovation in mobile technology in making payment instead of using credit cards; as a result promoting security and privacy. Authority: The article (Apple Pay and The New World of Mobile Digital Credit Cards) was written by Judith Bitterli is AVG’s Chief Marketing Officer. She’s eligible to write the article based on her 25 years experienced with AVG; an online security company providing leading software and services to secure devices, data and people. The second article (“Will Apple Pay be safer than credit cards?”) was written by Elizabeth Weise works. Elizabeth works in USA Today's San Francisco bureau, where she's covered tech, biotech, and breaking news. Accurate: The articles are, of course, authentic. The two articles are both products of AVG technologies and USA Today and they’re both reliable sources. In addition, the articles both refer to the main company and the accuracy has been tested by Wal-Mart and more company is asking for the service already. Purpose: The articles are both written to inform individuals, of the latest innovation in mobile technology that boost the privacy and security of credit cards. However, i believe there is a bias with the service. The article (Apple Pay and The New World of Mobile Digital Credit Cards) stated "NFC has been a feature in many other smartphones (including by Google) but has failed to take hold to date." I consider this a biased statement.5. scholarly journal article “Why Plastic Cards Will Survive Apple Pay”The debut of Apple Pay has far-reaching implications for the future of the U.S. payments system and has cast a bright light into a murky mobile wallet payments environment. Some may even wonder if Apple Pay is in fact poised to eclipse plastic card payments.As the digital payment card era unfolds, we can take a moment to look at the pre-Apple Pay environment - as measured in an August 2013 survey of 4,200 households by Phoenix Marketing International. There are several reasons why the end of plastic payment cards is nowhere in sight. First, it is well-known that a very small percentage of merchant terminals (estimated at no more than 5%) currently accept near-field communication payments, in which two devices placed at close range perform transactions via a wireless connection. Moreover, a significant portion of consumers are wary about the security of NFC transactions. Twenty-two percent of smartphone owners who have not used a mobile payments app said that "tapping a phone against a merchant terminal" was a major security concern.? While smartphones are certainly on the rise, they are not yet ubiquitous: 65% of households currently own one. That leaves more than a third of households for whom mobile wallets, in general, are currently not an option.Apple Pay's impact will also be limited by the fact that Android phones are more prevalent; less than half of smartphone owners have an iPhone. And nearly half of smartphone owners say they are unlikely to use a smartphone application for in-store payments. Among users who have yet to use a mobile payment app, 48% said that they were uninterested in using one, 38% were neutral, and just 14% said that they would be likely to adopt it.Lastly, while Apple enjoys a strong reputation, some Americans may not be willing to trust them to facilitate their transactions. Last year, 22% of smartphone owners indicated they would consider a mobile payment from Apple. A similar number (17%) said they would go with Google, but banks (72%) and PayPal (41%) were far more popular picks.The Apple Pay announcement heralds the likelihood of substantial increases in NFC-ready terminals. Since it coincides with current merchant investments in EMV-compatible terminals, merchants are more likely to make sure the upgrades include NFC compatibility. And Apple Pay's fingerprint identification and tokenization technology will help reduce consumer NFC security concerns. Nevertheless, there is still a long way to go before scale can be achieved.? It is important to emphasize that Apple Pay brings direction and credibility to the NFC marketplace and demonstrates NFC's future viability. That leaves the door open for other NFC wallets, such as Softcard and Google, to expand - and for entrants to increase the competition. At the same time, it should be noted that NFC technology is more than 20 years old. It may ultimately be deemphasized in favor of newer consumer-preferred technologies.History suggests that plastic payment cards will remain viable for a long time to come, even as the use of digital payment cards escalates over the next decade or two. Just look at the bill payments industry: while the incidence of online bill pay is high, consumer research shows that it will never reach 100%. And a high percentage of people who pay bills online still pay some of them using paper checks. When it comes to payments, old habits die hard. Greg Weed is director of card performance research for Phoenix Marketing International. scholarly journal article “Why Apple Pay Is Only a So-So Deal for Banks”Depending on who you ask, the launch of Apple Pay was either exciting or uninspiring. The truth is far more complicated - particularly in terms of how it will impact the dynamics of Apple's relationship with banks. I would venture that most of the financial institutions on stage at the launch of Apple Pay earlier this week have mixed feelings about their partnership. They have had to sacrifice a lot of the room for negotiation that banks have retained with other wallet players such as Google Wallet and Softcard (the company formerly known as Isis). If you are an Apple Pay launch partner, having your credential or token on Apple Pay does not mean that you get to extend that credential into your own mobile banking app or wallet. For example, Bank A, with its credentials stored on Apple Pay, cannot leverage those credentials so that its own mobile banking app can use them to enable direct payments. Banks will have to accept that their credentials will be indefinitely locked to Apple Pay till deletion.No bank wants its brand to be overshadowed by Apple, nor do banks want smartphone users to close their app and open up a different wallet to make a payment. But this was not up for debate with Apple, which wants to tightly control the payment experience. This should be a cause of concern for Apple Pay partner banks, for whom enabling payments outside of Apple Pay in iOS is now off the table.Banks' only hope of having an integrated payment experience is to focus on Android, which supports host card emulation technology. HCE uses software to emulate a contactless smart card and communicate with near-field communication readers. I would expect a lot of banks to revisit Android and HCE in upcoming months. That goes double for the institutions that were not chosen to partner with Apple, along with retailers who have not rejected contactless payments as a modality in stores.Given that Apple will reportedly collect fees from its partner banks when customers execute transactions on the mobile wallet, all banks should be thinking about ways that they can make their presence on other Apple offerings more lucrative. If I were them, I would begin segmenting customers who hold one of iTunes' 500 million active accounts to see which ones are affluent spenders and which cards have higher interest rates, then implement targeted customer incentive strategies to move Apple users to higher-rate cards. I would use the same tactic to convince customers to replace debit cards on file with iTunes with credit cards.But the big takeaway is that from here on out, banks can only gain incremental value from iOS. If they want to create a unified payment system that customers can use as part of their existing banking relationships, they'll have to focus on Android. Should that happen, I doubt that Apple could prevent such moves from diluting its merchant value proposition. But such moves on the part of issuers are hardly long-term strategies to incentivize frequent usage, merchant participation and overall customer value. Cherian Abraham is a mobile commerce and payments consultant at Experian Decision Analytics. Data base used: LexisNexis Academic and I must confess it gave data information more structured so it can be find quickly also its efficient because it gave several journal article based on my search. 6. The internet articles have quite a lot of result on my search; however, some of the article is not related to the search. Although it’s easier to access and also faster. On the other hand, the journal articles are written from a more reliable and reputable sources. For example, the journal article “Why Apple Pay Is Only a So-So Deal for Banks” was written by Cherian Abraham a mobile commerce and payments consultant at Experian Decision Analytics.ReferencesAPA FormatWorks Cited BIBLIOGRAPHY Abraham, C. (2014). Why Apple Pay Is Only a So-So Deal for Banks. 8-540.Bitterli, J. (2014). Apple Pay and The New World of Mobile Digital Credit Cards. AVG Technologies.Nat Kerris, T. M. (n.d.). Business Wire. Retrieved September 26, 2014, from Wire : Kerris, T. M. (n.d.). Business Wire. Retrieved September 26, 2014, from : , G. (2014). Why Plastic Cards Will Survive Apple Pay. 7-541.Weise, E. (2014). Will Apple Pay be safer than credit cards? USA Today. ................
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