Smartphone manufacturers have been competing for years trying to produce better and more exciting technology for their customers. They figured the best way to steal customers was going to be to have the latest and greatest. For the last couple of years, though, they have all kind of leveled out in the technology offered, and no smartphone seems significantly better than any other, though users may have their preference. That is why manufacturers such as Apple and Samsung are now racing to have the best mobile payment systems; whoever can get there first will win a lot of customers.
Mobile payments only work when everywhere
The biggest hurdle in the mobile payment systems in the past has been trying to find a way to provide a service customers want while at the same time getting stores on board with updating their technology to work with the mobile payment system. If credit card machines weren’t found nearly everywhere, people would be much less likely to carry around plastic. The same applies to a mobile payment system. Customers aren’t going to get on board unless the infrastructure is first in place.
Apple has a lot of contracts with financial institutions for their payment system and have also been working to get their technology (near field communications) into big name stores, but it has been taking quite a bite of time. According to Fortune, Apple has been struggling to get it everywhere and even contracts with banks are often a struggle due to Apple’s need to be in control.
Samsung, on the other hand, is certainly winning the race for mobile wallets. With Samsung Pay, the product mimics the magnetic strip on credit cards, making it possible to use the service nearly everywhere since it uses current infrastructure (magnetic secure transmission). On top of that, contracts with banks and credit card companies are a lot easier to work out with Samsung, a company more flexible on terms and conditions.
Stiff competition overseas
Though Samsung and Apple are racing to win over America’s smartphone market, they are both working in the rest of the world as well. This presents a problem in places like China where Alibaba and Tencent already have a strong presence and have already made mobile payment options easy to use in the country. Though Apple and Samsung may have more competition to deal with overseas, they are the best options in America right now, and Americans are just happy to see more options becoming available.
Source: Fortune
