William Gallagher
The European Union has has objected to how Apple denies other firms use of the same iPhone technology that drives Apple Pay.
As predicted, the EU has issued what it calls a preliminary view over Apple's control of the NFC contactless payment technology used by Apple Pay in the iPhone.
According to the Wall Street Journal, the European Commission has issued a statement of objections. It says that Apple restricts competition in the mobile-wallets market, and that its preventing developers from using the technology was done to benefit its own Apple Pay solution.
The statement of objections has been issued to Apple in writing. Following this preliminary view, a fuller investigation is continuing. Should the final investigation concur with this early report, Apple could potentially face fines of up to 10% of its global turnover.
"We designed Apple Pay to provide an easy and secure way for users to digitally present their existing payment cards and for banks and other financial institutions to offer contactless payments for their customers," an Apple spokesperson told AppleInsider. "Apple Pay is only one of many options available to European consumers for making payments, and has ensured equal access to NFC while setting industry-leading standards for privacy and security."
"We will continue to engage with the Commission," continued the spokesperson, " to ensure European consumers have access to the payment option of their choice in a safe and secure environment."
Apple further claims that while it is working to ensure it engages with the European Commission, it is concerned to keep what it describes as Apple Pay's high security. The company says that Apple Pay is markedly more secure and free of fraud than the third-party apps on Android.
As to the point of denying other companies access, Apple argues that Apple Pay is designed to provide equal access to all banks and financial institutions.
Updated May 2, 10:05 ET: Added Apple's response to the preliminary ruling.
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28 Comments
It’s ridiculous that the EU want to stifle innovation and try to dictate what technology companies - especially ones that don’t have a monopoly - can invent and use. Does every invention by every company have to be open to use by all other companies? This is nonsensical puerile government gone mad.
How long has this “mobile wallets market” being a “thing”? I’d argue it’s not even a relevant “thing” for antitrust - it’s not like you will die if you can’t have access to a mobile wallet.
If a fridge manufacturer adds payment processing on their white goods for ordering groceries will the EU insist that they allow all other companies to use their tech? No, only if it’s big-tech as they want their cash. Money-grabbing hypocrites is what they are.
I guess Apple will have to disable Apple-Pay for the EU and hike product costs to cover any fine that might happen. It’s not like people will stop buying iPhones if the prices go up…
The Apple control over the ecosystem is actually what makes it work well and work safely and is the foundational reason for why people buy Apple products whether they realise it or not.
To rip it apart will surely make it another G00gle product? To do so would surely cost $millions to rewrite the code that makes it work?
So if the EU leadership don’t like the Apple ecosystem as their representatives don’t seem to then they should use alternative products, they already have that choice and those other products are already available.
Imagine if you required an automaker to allow third parties to write the software controlling the engine.
Apple Pay will remain my payment system regardless. I changed banks when first introduced because 'my' bank was slow to bring it on, as it considered how much it would cost it, rather than how much I would like it. I would change again if any bank forced me to use 'their' method. Earlier as many companies tried to get into the NFC payment systems, it was clear that what they really wanted is to track us and less so the small additional cost to Apple. No thanks... banks. Opening the NFC to others may be a security issue, I have read. I do not understand what it is with EU regulatory bodies on this and the App Store. The EU is ahead of the world on privacy regulations yet seem to target US companies for thin rationales that turn out to not have legal merit aka Irish tax ruling in 2020. If I was cynical, I would say this is about money from fines and trying to level the competition field for non innovative EU companies.