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Could Apple Be Getting Ready To Launch Electronic Payments?

Could Apple Be Getting Ready To Launch Electronic Payments?

Any big new project by Apple (NASDAQ: AAPL) would be, by definition, news. Such was the case when sources told Re/code that the company had been interviewing senior payments industry executives ahead of a plan to launch an electronic payments business.

With nearly 600 million iTunes accounts – most tied to a credit card account – Apple already has the foundation for a substantial e-payments network. The two positions the company might be seeking to fill, according to one source, were “head of product” and “head of business development.”

The idea was to make it easier for Apple customers to buy products through apps and on the Web with their iPhones and other Apple devices. A natural extension would be the ability to make purchases in bricks and mortar stores using only their devices, which would tap into information stored in iTunes accounts.

Related: Hold Off On Buying That Apple TV!

Partnership discussions between Apple and eBay (NASDAQ: EBAY) subsidiary, PayPal, first reported in January, have continued but results of those discussions are not known. Neither Apple nor PayPal would comment when queried by Re/code.

Lots of Speculation

There was also discussion about Apple acquiring mobile payments startup, Square, but so far that speculation had not turned into anything substantial.

With quarterly earnings due Wednesday, and speculation that forward guidance could, in the words of Piper Jaffray's Gene Munster, “disappoint,” any positive news that could portend additional revenue streams would be welcome.

Adding to the mobile payments speculation, CNET noted recent patent filings, rumored meetings, and even analyst predictions that all point in that direction.

The patent filing related to a digital wallet system was first reported in January. The full title was "Method to send payment data through various air interfaces without compromising user data" and would involve a retail point of sale (POS) device, which would be connected to a backend system designed to handle transactions.

The Wall Street Journal reported in January that sources told it Apple executive Eddy Cue was meeting with retail and commerce executives regarding possible construction of a payments system.

All this followed a report by Piper Jaffrey’s Munster last April that Apple was one to two years away from a digital wallet system. At that time Munster speculated the payment system would launch with the iPhone 6 sometime in the first half of 2014.

Based on his belief that a digital wallet could have a ripple effect for Apple, Munster said, "If Apple can recreate the wallet, it would create tremendous stickiness in terms of iOS mobile products."

At the time of this writing, Jim Probasco had no position in any mentioned securities.

Posted-In: Apple Digital Wallet e-paymentsNews Rumors Events Tech Media Best of Benzinga


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