Apple Inc. (NASDAQ:AAPL)‘s mobile platform has a long journey to travel before it can significantly contribute to the company’s top line. CNBC‘s ‘Squawk Alley’ team discussed the product’s future with Henry Blodget, who is Business Insider’s editor-in-chief & CEO.
” […] On the merchant side, that is the big hurdle, it costs a lot of money to put one of these machines. There’s got to be a real reason to do it and the reason that mobile payments are working at Starbucks Corporation (NASDAQ:SBUX), where they are really working, that’s because there is a loyalty program built around it, they give you rewards and everything else […],” said Blodget.
This sort of loyalty program isn’t possible for Apple Inc. (NASDAQ:AAPL) to be a part of as transactions using Apple Pay are anonymous, added Blodget.
The ‘Squawk Alley’ team pointed out that merchants have been more interested in a network or layers that is going to shoulder the responsibility in the case of credit card fraud rather than a new form of payment. From the looks of it Apple Inc. (NASDAQ:AAPL) didn’t take into account the retailers’ needs, but rather focused on the customers.
Blodget also doesn’t see how Apple Pay will spark enthusiasm among its users, especially when only 2% of the total 9 million merchants in the US are equipped to handle this sort of transactions. However, he pointed out that there is a lot of potential for this feature in the long haul as it aims to replace our wallets and people will not be worried about losing their important cards like driving license etc.
While choosing among the most important announcement for Apple Inc. (NASDAQ:AAPL)’s media event this year, Blodget said its the iPhone without a doubt. He expressed a few reservations with regards to the iWatch too, which he sees as an important part of Apple Inc. (NASDAQ:AAPL)’s product line only after 2016. Two main features which, in his opinion, made the watch a limited success was that it needed an iPhone to be operated and had a tiny screen, which makes it hard to use.