In an Epic Fail, AndroidPIT Attempts to Rank Android Pay, Apple Pay, and Samsung Pay

by Tim Sloane 0

Despite a lack of many details, AndroidPIT ran this article claiming it would identify the best payment app between Apple Pay, Samsung Pay and Android Pay. In reality it simply points out a few advantages and disadvantages and then asks the question “What do you think? Is Google on the back foot here?

The ranking effort looks at availability from the perspective of launch date and through the channel into the consumer’s hands, how they work which includes acceptance footprint, and finally Security. Lets start with where they are available:

“For now, Android Pay remains US-only, while Apple Pay made its eagerly-anticipated UK launch on July 14 and is now available at 250,000 UK locations. The US gets Apple Pay on October 20. Samsung Pay launches in South Korea on September 20, in the US on September 28 and in the UK soon thereafter. There will be a beta test of Samsung Pay in the US starting on August 25.
UK Apple Pay users can already spend up to £20 per transaction; this will rise to £30 in September. As well as being able to use Apple Pay in reputable outlets such as McDonald’s, Costa Coffee and BP, UK users can now tap their iPhone to pay for public transport in London. Not all banks support Apple Pay though, so there are some limitations.
Thanks to its UK launch, Apple Pay currently has the edge over Android Pay and Samsung Pay in terms of where you can get it. In the US, the number of supported retailers is roughly the same: Apple announced 700,000 Apple Pay locations in March, and Android Pay has the same number. Samsung Pay isn’t yet functional, but ”has the potential of being accepted at approximately 30 million merchant locations worldwide”.
Why so many more? Because Samsung Pay is backwards compatible with older swipe-based credit card machines. We’ll explain how that works below, but both Apple Pay and Android Pay only work with newer NFC (Near Field Communication) technology (Samsung Pay also works with NFC-equipped credit card terminals). On MST (magnetic secure transmission), Samsung Pay is supported by Visa, Mastercard and American Express, along with a large number of banks.”

Next the article does a quick review of how consumers will get the payment apps and what devices in a section called Where are they available. It points out the fact that the HCE implementations in the UK have significant restrictions applied to the open to buy, but does so without discussing the challenges of an HCE implementation:

“It depends on which phone you have. Android Pay has a huge advantage in terms of compatibility with devices already on the market, and will work on any Android smartphone running Android 4.4 KitKat or newer (which currently accounts for more than 55 percent of active Android devices).
Samsung Pay only works on top-tier devices launched in 2015: the Galaxy Note 5, Galaxy S6 Edge+, Galaxy S6 Edge andGalaxy S6. Of course, your phone will need to have NFC for this to work. Apple Pay currently only works on the iPhone 6, iPhone 6 Plus and Apple Watch, although if you’ve dropped $399-plus on an Apple Watch, you can pair it to an iPhone 5, 5C or 5S to use it as an Apple Pay device.
Apple Pay only works on NFC iPhones. That means the iPhone 6 and the iPhone 6 Plus. / © Apple
To get Android Pay you simply need to have a device on KitKat or newer and turn on NFC in your settings. Then set up your credit card and look for the Android Pay logo in stores. Android Pay is potentially available to 10s of millions of people – that’s because it’s really Google Wallet underneath, which has been kicking around since 2011.
The 2015 range of Samsung devices already have Samsung Pay enabled, we’re just waiting for retailers to flip the switch. You’ll need to turn on NFC in your settings but Samsung Pay also works with MST, which doesn’t require NFC. Apple Pay is on the iPhone 6 by default, so again, just set up your credit card details and look for the Apple Pay logo in stores.
It’s worth pointing out that while Google’s service is called Android Pay, it doesn’t mean Android in general: it won’t be part of the Android Open Source Project (AOSP) and it won’t be on forked versions of Android such as the ones used by Amazon for its Kindle Fire devices. We’ll have to wait and see if custom ROMs manage to get around this limitation or if only manufacturers get the green light for their official tweaks to Android.”

The how does it work section doesn’t offer any information Payment Journal readers wouldn’t already be familiar with as it focused on Samsung’s MST technology acquired from Loop Pay. So that brings us to the section titled How secure are they, which was the weakest section since the author was clearly unfamiliar with payment card security features:

“All three NFC services look pretty secure so far: neither system transmits your actual card details to the retailer, but instead creates an ‘alias’ or ‘virtual’ card that’s used purely for that transaction. In effect, that means two different transactions are taking place: one between Google or Apple and the retailer, where the retailer gets paid for the sale, and one between Google or Apple and you, where Google or Apple gets reimbursed by you.
That’s a good thing, because if you remember any of the major retail card breaches of the last few years – Target, TJ Maxx and so on – it was the retailers’ systems that got hacked, not the banks’. In theory at least, if you use Android Pay, Samsung Pay or Apple Pay and the retailer you used gets hacked, any details they get about you will be completely useless.
MST is slightly different. Because it relies on an older technology, you might think that it is actually sending your credit card details to the retailer – and potentially to anyone that figures out how to hack the system. But this is not the case. Samsung Pay’s MST system is encrypted with a once-only token. The terminal picks up that token – not your credit card details – and the token is then transmitted to your bank, where it is decrypted and the transaction processed.”

The section titled “and the winner is” not only doesn’t rank the payment apps, it discusses the open issues that prevent a winner from being called, which is a bit of a cop out:

On the face of it, Android Pay reaches more people than Apple Pay does, because Android massively outsells iOS. There’s currently more than 20,000 different types of Android device in the world. However, as Karen Webster writes, things are a bit more complicated.
While Android is definitely bigger in the US than iOS – it’s on around 100 million phones compared to about 80 million for Apple – fewer than half of those devices run KitKat or later, and of the ones that do, only around one-fifth are NFC equipped.
Webster suggest that the total number of Android phones “ready to rock it with Android Pay” is about six million. For Apple Pay, the figure is about 14 million – and Apple customers tend to spend more than Android ones do. If you were a retailer, which one would you support first?
When we turn to Samsung Pay, that number drops to however many people have bought a Samsung flagship in 2015 or plan to in the coming months and years. However, Samsung Pay working on both NFC and MST makes the system way more versatile than either Android Pay or Apple Pay. Anyone with a new Samsung device has no real reason to bother with Android Pay at all and Samsung sell the most Android phones of anyone.
There’s no doubt that Android Pay is better than Google Wallet, but it’s also clear that Google has a tougher challenge than Apple does: not only does it have to negotiate with retailers, but it also needs to negotiate with handset manufacturers to get Android Pay onto their devices, not just in the US, but in any country it wants to bring Android Pay to. Other than retailers, Apple doesn’t need to negotiate with anybody.
There’s also the possibility that other manufactuers may follow Samsung’s lead and develop their own payment system, which would steal even more of Google’s thunder. It’s going to be very interesting to see how this all pans out.”

Oveview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group

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