Apple Pay: Australians Are Ready for It, Is Your Business?
Australia is one of the few places in the world that has taken to using NFC payment options in force. Many people are used to taking out their bank card and tapping it against the sensor at the cash register. But what if you didn’t even need the card?
Enter Apple Pay. If you’ve decided to come out of your hermitage recently and haven’t heard of Apple Pay, it’s a really big US tech company’s response to getting rid of your wallet. If you’ve got an iPhone 5, 6 or 6 Plus—and who knows, there may be several other iterations by the time this magazine article goes live—Apple Pay will be coming to you shortly.
Apple Pay was launched in the US in October of last year and already has 60 in-country banking institutions signed up to allow their customers use of the service. Major credit card companies Visa and MasterCard went on the record with their support of Apple Pay with Charlie Scharf, Visa CEO, and Ajay Banga, MasterCard CEO, excited about what Apple is doing. And as the Apple Watch comes into the fray in April of this year, Apple Pay will become even easier to use.
Although Apple Pay doesn’t have a launch date for Australia yet—sources working with Gizmodo Australia say that it may be as early as this month—businesses that could benefit from Apple Pay should start working towards it now.
Here’s How It Works
Passbook, an Apple-developed app, stores your credit card information on your phone or mobile device like your iPad or future Apple Watch. The Touch ID function—your fingerprint scanner in the home button—helps protect your personal encrypted information so that even if your phone is stolen, the thief cannot make purchases with it. You’ll just scan your phone over the NFC sensors, and payment made!
In the US, Apple negotiated with the big banks and credit card companies first to reach the widest audience from the get go. Anticipate the same approach in Australia with most, if not all, of the big four banks—Westpac, NAB, CBA and ANZ—by launch time.
For businesses, a contactless terminal on your EFTPOS (electronic funds transfer at point of sale) machine will need to be installed at the cash register. Since NFC technology and payments are already pretty common in Australia, we’ll bet many of you already have at least one at your business counter.
Another cool feature is Apple Pay’s integration with your business app. Instead of signing into PayPal, entering your credit card information at checkout or having your credit card, businesses that allow Apple Pay in their apps will let their customers just pick a card from Passbook and pay that way.
A recent article from Mainstreet discussed the threat Apple Pay poses to Paypal.
“Analyst Steve Weinstein believes that PayPal suffers from a challenging relationship with payment counterparties and can't offer the biometric security capabilities that Apple Pay can,” the article reads. “Apple Pay also has the power of the brand's affinity and an ease of use that will be difficult for competitors to overcome.”
With Apple Pay already poised to overtake the transaction volume of Google Wallet, which never took hold in the US, PayPal and similar apps and technological payment options need to figure out ways to stay on top and evolve into something that can compete with this behemoth.
It’s Not Just for McDonalds or Macy’s
Small business could really benefit from Apple Pay, but they have to make sure it works for them before jumping in wholeheartedly. There are a few things to consider.
In 2012, there were two iPhone users for every one Android user: Apple has a big market in Australia.
Big companies could up the ante by getting customers used to the ease of the NFC payment option, leading to them demanding it from smaller companies. NFC technology is expected to be integrated into the Apple Watch, facilitating a wider market. And as it was mentioned earlier, many small businesses in Oz may already have NFC readers that would work with Apple Pay.
If you think that Apple Pay would be an asset to your small business, there are two approaches going forward: integrating it as soon as it’s available, or waiting to see if widespread use takes off.
What Your Business Can Do To Prepare
If you are ready and willing to integrate Apple Pay into your business model, start investigating your options for contactless terminals on your EFTPOS machines. This is the only piece of hardware you’ll need to provide Apple Pay as a service, so it may be a good investment for your company. These machines range from US$150 to US$500, so check your budget to make sure it fits. If your business already has one, even better!
Read related articles from Business Review Australia:
iPhone 6, iPhone 6 Plus and Apple Watch: Top 10 Innovations from Cupertino Today
The Security Pyramid: Building a Base for Global NFC Adoption
Next, keep an eye on your bank to see if they will be integrating Apple Pay. It would be a bit much to change banks just to have this as part of your business, but when Apple Pay does get introduced your bank may not be far behind in including it with its services.
I think the ability to combine Apple Pay into an existing business app is one of the best things about the service. It provides you an easier way to accept payment, and peace of mind to your customer, especially with all the news of security hacks that are happening all too often now.
Perhaps the most important is to read up on the security that Apple Pay provides its users. If it’s a service you are going to tie your name and your business to, it is imperative to know the ins and outs. In the early days of implementation, there will most likely be several questions from your customers about its use. With security at the forefront of everyone’s minds, being able to share information about Apple’s Touch ID function and its encrypted data will help put your customers at ease.
Offering any sort of NFC payment technology to your customers is about ease of use, for you, your business and them. Apple Pay is just another way to provide a helpful service to your customers. If it doesn’t take too much effort to do so, it just might be worth it in the long run.
Why Alibaba Cloud is doubling down in Southeast Asia
Alibaba has announced expansion of its cloud business within Southeast Asia, with the introduction of a digital upskilling programme for locals alongside acceleration of its data centre openings.
This doubling down of its cloud business in Southeast Asia comes as the company faces stiff competition at home in China from rivals including Pinduoduo Inc and Tencent and seeks to up its game in a region considered to be the fastest-growing in cloud adoption to compete with leading global cloud providers AWS, Google and Microsoft.
Alibaba Cloud, the cloud computing arm of Chinese e-commerce giant Alibaba and second biggest revenue driver after its core e-commerce business, finally turned profitable for the first time in the December 2020 following 11 years of operation, thanks largely to the pandemic which has spurred businesses and consumers to get online.
Southeast Asia growing demand for cloud
In 2020, there was a noticeable increase in interest towards cloud in SE Asia, with the population embracing digital transformation during the pandemic and SMEs across the region showing increased demand for cloud computing.
Such demand has led to the expectation that Southeast Asia is now the fastest-growing adopter of cloud computing with the cloud market expected to reach US$40.32bn in Southeast Asia by 2025 according to IDC.
And there are plenty of players vying for a slice of the cloud pie. While AWS, the cloud arm of Amazon, is the leading player in Southeast Asia (and across all of APAC apart from China), Microsoft and Google are the next two most dominant players in Southeast Asia with Alibaba coming in fourth.
“There is no doubt that during the past year we have seen the acceleration of digital transformation efforts across all industries,” explains Ahmed Mazhari, President, Microsoft Asia. “Asia now accounts for 60% of the world’s growth and is leading the global recovery with the digitalization of business models and economies. Cloud will continue to be a core foundation empowering the realization of Asia’s ambitions, enabling co-innovation across industries, government and community, to drive inclusive societal progress.”
Alibaba’s commitment to Southeast Asia
At its annual Alibaba Cloud Summit, the Chinese company announced Project AsiaForward, an initiative designed to upskill local developers, small-to-medium-sized companies and connect businesses with venture capital. Alibaba said it would set aside US$1bn over the next three years to develop digital skills in the region, with the aim of helping to develop 100,000 developers and to help grow 100,000 tech startups.
But that’s not all. The company, which recently opened its third data centre in Indonesia, serving customers with offerings across database, security, network, machine learning and data analytics services, also announced it would unveil its first data centre in the Philippines by the end of 2021.
Furthermore, that it would establish its first international innovation centre, located in Malaysia, offering a one-stop shop platform for Malaysian SMEs, startups and developers to innovate in emerging technologies.
“We are seeing a strong demand for cloud-native technologies in emerging verticals across the region, from e-commerce and logistics platforms to FinTech and online entertainment. As the leading cloud service provider and trusted partner in APAC, we are committed to bettering the region’s cloud ecosystem and enhancing its digital infrastructure,” says Jeff Zhang, President, Alibaba Cloud Intelligence.
What other cloud providers are pledging in the region
This pledge by Alibaba to upskill both individuals and businesses follows Microsoft’s announcement in April that it was planning to upskill Malaysia’s population and would invest US$1bn over the next five years to build a new data centre centre in Malaysia.
This is the latest in a long line of pledges to the region by the US tech giant, which is fast accelerating the growth of its cloud datacenter footprint in Asia, expanding form seven 11 markets, and recently adding three new markets across Asia – Malaysia, Indonesia and Taiwan. Back in February, it announced plans to establish its first datacenter region in Indonesia and to skill an additional 3 million Indonesians to achieve its goal of empowering over 24 million Indonesians by the end of 2021.
And recent research by IDC shows that Microsoft’s most recent datacenter expansions in Malaysia, Indonesia and Taiwan alone are set to generate more than US$21bn in new revenues and will create 100,000 new jobs in the next four years.
Also last month, Tencent announced it has launched internet data centres in Bangkok, Hong Kong, Tokyo to add to its second availability zone opened in Korea last year and plans to add an internet data center in Indonesia, and Google has also been pushing into the enterprise space in Southeast Asia for several years now.
Expanding data centers allows cloud providers to boost their capacity in certain countries or regions.