Apple Made Its Move into Payments — Here’s What’s Next

Screen Shot 2014-09-09 at 6.14.25 PMAfter years of speculation, Apple rolled out two new products yesterday morning that will shape the future of the company: Apple Pay and the Apple Watch. The moves could play an important role in the growth of the local technology market, creating the platform and accessibility for companies to finally bring store payments online.

The payment service will likely make the most impact in the near-term. An efficient and scaled Apple payment network will create a platform on which companies can build meaningful local commerce applications with little additional cost. It’s still unclear whether the company will take the massive cut it currently takes from in-app purchases, but the new system could potentially impact everything from the advertising industry to the point-of-sale market.

A number of companies have already started to work with Apple to integrate the payment technology as well as develop applications for the new watch. Here’s a rundown of a few.

LevelUp: The payments and loyalty company plans to ship a handful of updates in the next few days to integrate with Apple Pay. The company will have its app — as well as the 100 or so companies that white-label the software — integrated into Passbook, which serves as the front door for Apple Pay. Users will be able to pay for goods, and redeem points, all within the until-now underused Passbook functionality.

It also says it will send out a new NFC- and Beacon-enabled scanner — an alternative to the existing QR functionality — to merchants in the next few days. What’s more, the company will also integrate with Apple Watch. Matching existing functionality with Android Wear and Pebble, the applications will allow users to pay with LevelUp with the Watch.

As a spokesman for LevelUp said in an email: “In 30 minutes, Apple just did what no one else could in 10 years, move mobile payments from a “nice-to-have” to a “must-have.”

Square: Some see Apple Pay as a challenge to Square, but Jack Dorsey, the company’s founder, does not seem fazed. In a tweet posted shortly after the event ended Tuesday, Dorsey said that the company would “accept any form of payment that comes across the counter, including Apple Pay.”

A Square spokesperson declined to comment further, and its still unclear to what extent Square’s payments system will Apple’s new product. But the tweet does underscore a broader shift in Square’s strategy away from payments toward point-of-sale and payment processing which began when the company ditched its consumer-facing payment app this summer.

Groupon: Tim Cook, Apple’s chief executive, actually gave Groupon a shout-out on stage Tuesday, highlighting the company as one of a handful of featured partners for Apple pay. The deals giant will integrate Apple’s technology into its mobile app, allowing users to buy both local deals and goods in a single click.

It’s a slightly different integration than Square and LevelUp, since the transaction does not involve a store. A Groupon spokesperson says the company is evaluating ways to use Apple Pay, or the NFC-capabilities to improve the offer redemption process, but says the

Uber: No need to sign up for Uber to hail a car, anymore. An integration with Apple Pay will allow users to pay for a ride without creating an account. The ability for users to pay for rides without an account is an important complement to Uber’s new API strategy, allowing non-users to seamless use the service without even downloading the app.

Steven Jacobs is Street Fight’s deputy editor.

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