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Apple Prepares 'Apple Pay' Credit Card To Offset Slowing iPhone Sales (marketwatch.com)

Posted by EditorDavid on from the pay-different dept.

An anonymous reader quotes the Wall Street Journal: Apple and Goldman Sachs are preparing to launch a new joint credit card, a move that would deepen the technology giant's push into its customers' wallets and mark the Wall Street firm's first foray into plastic. The planned card would carry the Apple Pay brand and could launch early next year, people familiar with the matter said...

As new iPhone sales growth slows, Apple is focusing on services such as mobile payments, streaming-music subscriptions, and App Store sales. Apple Pay, which generates revenue on each transaction, is a key contributor, but adoption has been slower than executives hoped... Apple could take a larger cut of mobile payments from the card if it is used for purchases, the person said. Currently, when a consumer pays for a purchase using the digital wallet on the iPhone -- regardless of what credit card the customer charges -- Apple receives 0.15% per transaction. Apple could more than double that under the agreement with Goldman, one of the people said.
The deal also reportedly includes having Goldman Sachs offer loans to customers at the Apple Store.

43 of 85 comments (clear)

  1. Really? by methano · · Score: 2, Insightful

    Really? Is there no Apple news that can't be twisted into an "Apple is dying" story?

    1. Re:Really? by Anubis+IV · · Score: 5, Insightful

      The funny thing here is that they’ve managed to twist a record-breaking quarter into a bad thing. Check the summary and you’ll see that it contradicts the headline. The summary makes it clear that it’s slowing iPhone sales growth, not slowing iPhone sales. Sales are still up, they’re just not up by as much as they were before the market became saturated.

    2. Re:Really? by Anonymous Coward · · Score: 1

      So, you're saying that Apple, a company that sits on a pile of money so big they could probably buy a country or three, is at the same time under such crippling debt that it may destroy them?

    3. Re:Really? by ShanghaiBill · · Score: 2

      To be fair, slowing sales growth means that the growth in the stock price will also slow.

      Nope. Apple has a PE of 16. The average for all stocks is about 25. So investors were already expecting a slowdown in sales, and it turns out that growth slowed LESS than expected, so the share price went UP ... more than 10% since the earning report went public on May 1st.

    4. Re:Really? by MouseR · · Score: 1

      It worked for the past 30 years.

    5. Re:Really? by jellomizer · · Score: 1

      Probably not.
      A lot of these statements will contradict themselves. Because people will contradict themselves and the issues are far more complex then a Slashdot post can explain.

      1. You have Android Fan boys who think Apples success will lead to Androids failure. Thus are afraid of backing the wrong team. While there is growth in both markets and the competition between the two systems actually help them improve themselves. If Apple starts to fail, Android is going to have problems shortly after.

      2. Holdout from the 16bit days, Apple vs. Commodore/Amiga vs. IBM vs. ... Today's Cell phone market is a lot like the PC market during the late 1980's. We all had our camps. And many are bitter to see their favorite brand be absorbed or killed off into the IBM Compatible PC Market.

      3. Ultra Conservatives, because Apple is run by a liberal guy.

      4. Ultra Liberals, because Apple is a for profit company and runs like one.

      5. People who have been burned by Apple. They got a product that didn't work as well as they hoped or didn't last long. (Granted this happens with Google too)

      6. Trying to be Cool by not being Cool. Apple is the popular product, so the cool people don't use the popular product, because that shows they are brainwashed by marketing. So to fit in the the cool people you have to show that you don't follow what is cool.

      7. Doesn't have the money to spend on it. They secretly like the products, but cannot afford it or justify the price. So they settled with something cheaper and needs to justify themselves that they made the better decision.

      8. If you are going to be on a side, you are going all in. This is common in today's culture. It isn't enough to just be a supporter of a side, but you need to be a "pure" supporter.

      9. You don't like the products (often for good reasons), but cannot see why others will have good reasons to like the product.

      10. They are big name in the industry, We want to see the big guys fall.

      --
      If something is so important that you feel the need to post it on the internet... It probably isn't that important.
    6. Re:Really? by GrabbaTheButt · · Score: 1

      Beyond the 10% bump lets try to acknowledge the share price is at an all time high at the moment. Doesn't strike me that the market is really thinking that Apple is somehow doomed.

    7. Re:Really? by Ol+Olsoc · · Score: 1

      iPhone Manufacturers’ Slowing Sales Are a Bad Omen for Apple.

      Apple has been dying and getting bad omens forever.

      As smartphones have become ubiquitous, the crazy numbers of new adopters simply have to slow down. We went through something similar with feature phones a few years back. I know only a couple people who have those dinosaurs now.

      Regardless, the technology has matured rapidly, and now most sales will be replacement, some children, and a small group of elderly. people.

      I'd wager that Apple has had this plan in the works for years.

      In trying to think of the killer new smartphone that will have everyone dumping what they have now, I'm not coming up with much. Cutaneous dock implant, then direct visual and tactile implant the whole phone?

      So until those dream devices come along, Apple management simply had to know the market would saturate, and planned on this years ago.

      --
      The shepherds did so well protecting the flock that the sheep no longer believed that wolves existed.
    8. Re:Really? by Ol+Olsoc · · Score: 1

      Probably not. A lot of these statements will contradict themselves. Because people will contradict themselves and the issues are far more complex then a Slashdot post can explain.

      Your post is on point. And its a pity too. Android phones are perfectly good devices as long as you watch out for the stuff on the cheap end. But the phones in direct competition with Apple are fine machines.

      They are also pricy as well. My son paid more for his samsung phone than I paid for my iPhone. But that's beside the point other than debunking the age old canard of taking the cheapest competition and comparing it to the Apple product.

      I appear to be an outlier though - if taking the vitriol I'lll likely get for posting the above heresy.

      My choice to go with an iPhone was simple. 1. Quality, check. 2. Price comparison with similar competition? Similar, sometimes a little less, sometimes a little more. 3. Interface seamlessly with my Macs? Check.

      Except for number 3, I'd be happy with either iPhone or Android.

      --
      The shepherds did so well protecting the flock that the sheep no longer believed that wolves existed.
    9. Re:Really? by Thelasko · · Score: 1

      The summary makes it clear that it’s slowing iPhone sales growth, not slowing iPhone sales.

      This is a big deal, but it doesn't mean Apple is going out of business anytime soon. It means that Apple is transitioning from being a growth stock, to a value stock. This is a tricky thing to do. Microsoft struggled with the transition at the turn of the millennium.

      In order for Apple to still remain appealing to investors, they need to pay careful attention to how they issue dividends.

      Of course, there will still be some people in denial that they are no longer a growth stock. These are the people that are freaking out about slower growth. However, as long as management has come to terms with it, and doesn't try to over-saturate the market, they will be fine.

      --
      One of our competitors trademarked the term "hypothesis". From now on, we will call them "boneheaded ideas".
    10. Re:Really? by wwphx · · Score: 1

      I like your list. The kit you use is a complex issue and you choose what you run for multiple reasons. I switched to Mac in '08 because my Lenova was on its last legs and I was sick and tired of updating on a seemingly daily basis and having crashes pretty much just as often. My wife bought me a Mac laptop and I haven't looked back. She's an astronomer and her observatory is Mac-based because their data center is Linux-based. I've been Mac-based since then and use VMs to spin up Windows when I need SQL Server which is my professional bread and butter, but not for long. I use an iPhone and iPads because they integrate wonderfully with my iMac and used MacBook Pros, and I look at all of the spyware in the Android marketplace and am quite content with the Apple Store Walled Garden. I've previously owned Android tablets and I just don't like the feel of the UI.

      But to each their own. If you like the Windows ecosystem, go for it. If you want the Linux ecosystem, go for it. I run all three and I'm happy, but mainly I'll stick with Apple. And my Pebble Time Steel, until it dies. Dunno what will follow it.

      --
      When you sympathize with stupidity, you start thinking like an idiot.
    11. Re:Really? by TheFakeTimCook · · Score: 1

      Really? Is there no Apple news that can't be twisted into an "Apple is dying" story?

      Exactly what I came here to say.

      EVERYONE'S (or nearly everyone's) Smartphone sales are DOWN.

      TFS is Clickbait at its best. Or worst.

    12. Re:Really? by TheFakeTimCook · · Score: 1

      The funny thing here is that they’ve managed to twist a record-breaking quarter into a bad thing. Check the summary and you’ll see that it contradicts the headline. The summary makes it clear that it’s slowing iPhone sales growth, not slowing iPhone sales. Sales are still up, they’re just not up by as much as they were before the market became saturated.

      Those are the same people that try to twist a Tax Increase that is less-than-predicted into a Tax CUT. Not talking about any SPECIFIC Tax Increase/Cut here; just the terminology.

    13. Re:Really? by TheFakeTimCook · · Score: 1

      Beyond the 10% bump lets try to acknowledge the share price is at an all time high at the moment. Doesn't strike me that the market is really thinking that Apple is somehow doomed.

      Exactly. TFS (and TFA) is disingenuous, at best.

    14. Re:Really? by TheFakeTimCook · · Score: 1

      iPhone Manufacturers’ Slowing Sales Are a Bad Omen for Apple. [bloomberg.com] Don't like the Slashdot headline? Then how about that bastion of conservative capitalism, Bloomberg. For your edification, "slowing sales" is commonly understood as synonymous with "slowing growth". Because everybody knows what comes next: "flat sales". Then "declining sales". Sorry I needed to spell it out for you.

      I guess it has to be repeated AGAIN:

      "Apple: Proudly Going Out of Business for Over FORTY Years!"

    15. Re:Really? by TheFakeTimCook · · Score: 1

      Not only have they just had a record-breaking quarter, but Apple took 86% of profits across the whole smartphone industry and iPhone X took 35% alone in Q4 2017. I wish I could fail as badly as Apple.

      Precisely!

    16. Re:Really? by thebullshitpatrol · · Score: 1

      Breaking slashdot news: Apple has been one quarter away from declining sales for the past 15 years :^)

    17. Re:Really? by Anubis+IV · · Score: 1

      For your edification, "slowing sales" is commonly understood as synonymous with "slowing growth".

      Perhaps among armchair know-it-alls on Slashdot who feel a need to move the goalposts. Actual professionals don’t conflate acceleration with velocity if they want to keep their jobs for long.

      And there’s been “worry” about Apple for as long as there’s been an Apple. Pointing out that someone is worrying about Apple’s future just means today is a day of the week. Which isn’t to say that all worry is unjustified. But those of you routinely declaring the imminent doom of Apple are like a meteorologist who always predicts that a hurricane will hit the New York coast “soon”. Past experience (e.g. Sandy) tells us that one day you could be right, but are we supposed to let you off the hook for being wrong every day until then? The broken clock doesn’t get to say, “I told you so!” during the two minutes it’s correct each day.

      Also, contrary to your assertions, what the quarterlies revealed dispelled quite a few false notions regarding the sentiment that the iPhone is slowing. For one, it revealed that the low OLED display sales numbers that Samsung reported a few weeks prior weren’t because of flagging iPhone X sales, which was the widely held belief going into Apple’s earnings report. Rather, the numbers revealed that the iPhone X sold more units than expected, indicating that the poor OLED numbers were due to flagging sales of Samsung’s own phones: numbers which they conveniently didn’t break out. Relatedly, the ASP across the iPhone line skyrocketed, indicating that interest in the X is more ongoing and widespread than expected (i.e. it’s not just early adopters). It also demonstrated that Apple has a means by which to continue growing their profits—which is what investors are really looking for—despite the market reaching saturation. That they raked in an estimated 86% of all profits in the market this last quarter is proof of their ongoing success.

      Which again, is not to say that they’ll stay on top forever. No one except the most zealous of Apple fanboys believes that. But recognizing that the mighty eventually fall doesn’t take any special insight, nor do you get to claim credit for being right if you started predicting that the end was nigh far before it actually comes to pass.

    18. Re:Really? by Mashiki · · Score: 1

      Yes. You must be pretty young, or you'd remember a time when GM was so large that it could have bought Ford and Chrysler in the 1980's, and a country to spare. Remember what happened a few years ago? How's Kmart doing these days? Same problem, how about Sears? Oh...the same problem.

      --
      Om, nomnomnom...
    19. Re:Really? by Gorbag · · Score: 1

      There's only two kinds of stock - growth and value. If you can figure out how much a business is worth based on well-understood metrics (EPS, Book value, etc.) then it's a value stock, and it's PE should be in line with the market with various modifiers based on the specifics of these metrics. Otherwise (you add fantasy and predict "big things") it's growth, and the PE is generally a multiple of the market. Apple has been too large to be a "growth stock" for some time, and arguably made the transition the minute it began paying dividends, or the PE fell to the market value whichever you like. My point is, I don't think it's transitioning *now*, though Berkshire's sudden interest does indicate that Buffet thinks the stock is very undervalued (he wants to see a big multiple between when he buys and sells).

      --
      -- I speak only for myself
  2. Slowing iPhone sales by Powercntrl · · Score: 2

    Have they considered just lowering the damn price?

    --

    ---
    DRM is like antifreeze, to the MPAA/RIAA it's sweet, to the consumers it's poison.
    1. Re:Slowing iPhone sales by Aighearach · · Score: 2

      You're holding your wallet wrong.

      It is a bit misleading, though; they're not really doing something new with the credit card, they're just switching which bank they partner with for it. \

      The loans are the new part, but it sounds like it is a small program.

    2. Re:Slowing iPhone sales by Ol+Olsoc · · Score: 1

      Have they considered just lowering the damn price?

      Many status symbols are Veblen Goods. A lower price would make it more affordable, lower the status boost for owners, and may depress sales.

      Apple employs many marketing professionals, and is the most profitable corporation in the history of the world. I doubt if you are smarter than they are.

      As well, amortize that price difference over the life of the phone.

      I really wonder what percentage of Apple users get them because of "status". at least to this Apple user, I like the phone because it integrates with my Macs which I like because I like Unix. I had the Unix MacOS first, so the iPhone followed.

      --
      The shepherds did so well protecting the flock that the sheep no longer believed that wolves existed.
    3. Re:Slowing iPhone sales by Dustie · · Score: 1

      Apple employs many marketing professionals, and is the most profitable corporation in the history of the world.

      Please don't make up stuff just because you can. Apple isn't even in the top ten. The Dutch East India Company was a publicly traded corporation worth more than ten times as much as Apple.

    4. Re:Slowing iPhone sales by TheFakeTimCook · · Score: 1

      Have they considered just lowering the damn price?

      Why?
      Fairly comparable Android phones are also fairly comparable in price.

      Now what?

    5. Re:Slowing iPhone sales by Dragonslicer · · Score: 1

      If you're taking out bank loans to buy fashion accessories, it's time for an intervention.

      Especially when you can already get a loan with 0% interest from the carrier. For my current phone, I paid more in sales tax than I did for the down payment ($20 down on a $500 phone).

  3. Fake News by SuperKendall · · Score: 1, Informative

    Apple iPhone sales are not slowing down but competitors are...

    Which if you bother to think of what that means Apple's overall market share of smart phones is increasing, globally.

    Apple is doing these other things, to also grow other areas of the company, not to offset anything. Why wouldn't you try to grow every area of the company you could. especially if you have as much cash as Apple?

    --
    "There is more worth loving than we have strength to love." - Brian Jay Stanley
    1. Re:Fake News by Tough+Love · · Score: 1

      The 52.2 million handsets sold is at the lower end of what analysts expected and is roughly flat year over year. Regardless of good financial results, that is clearly what the financial industry calls a "slow down" in Apple's core business.

      --
      When all you have is a hammer, every problem starts to look like a thumb.
  4. Good Bye Barclays by Kozar_The_Malignant · · Score: 2

    It's more about capturing revenue that currently goes to Barclays. It's also about spreading the Apple Pay service.

    --
    Some mornings it's hardly worth chewing through the restraints to get out of bed.
    1. Re:Good Bye Barclays by wwphx · · Score: 1

      I do not find Apple Pay convenient to use for in-store transactions over standard plastic cards, though I understand that if I had an Apple Watch that it's pretty spiffy. I imagine Android's pay system is no more convenient. I tried to use Apple Pay to buy something online once via my iMac and iPhone, and while the tech was impressive, it failed, but PayPal had been failing, it was sort of a last ditch thing to buy a book from the USA via an Irish site. And if Goldman Sachs is in the picture it guarantees that I will not get an Apple credit card. GS is one company that I would happily dance in their ashes after all the shit they've pulled over the years.

      --
      When you sympathize with stupidity, you start thinking like an idiot.
    2. Re:Good Bye Barclays by kalpol · · Score: 1

      I use it where it's available. All privacy concerns aside, it's considerably faster than a card (open app, hold up phone, it dings, that is all) and more secure with the one-time-use CC numbers. No receipts to sign, no card to pull out and put away, and faster than waiting for the chip reader to do its thing.

      --
      12:50 - press return.
  5. get $200 off when you get the apple card only 30% by Joe_Dragon · · Score: 1

    get $200 off when you get the apple card only 30% APR

  6. I like NFC payments, such as Apple Pay by 93+Escort+Wagon · · Score: 1

    I use Apple Pay wherever I can, because NFC payments rock; but I don't really see any advantage to carrying an Apple Pay branded piece of plastic.

    --
    #DeleteChrome
    1. Re:I like NFC payments, such as Apple Pay by NeilAtWhartonSquare · · Score: 1

      It's not about a plastic rectangle it's about getting a percentage of everything you buy and the data that goes with that purchase.

    2. Re:I like NFC payments, such as Apple Pay by Rosco+P.+Coltrane · · Score: 1

      I use Apple Pay wherever I can, because NFC payments rock; but I don't really see any advantage to carrying an Apple Pay branded piece of plastic.

      I use cash wherever I can, because not giving any personal data or any of my money to megacorps who don't pay their fucking taxes rocks.

      --
      "A door is what a dog is perpetually on the wrong side of" - Ogden Nash
  7. Head meet desk by Dustie · · Score: 1

    "The deal also reportedly includes having Goldman Sachs [FULL STOP]"
    That is enough for me to stay far away from Apple. What's next? Equifax?

  8. Apple customers might be bad for apple credit card by Presence+Eternal · · Score: 1

    I don't know if this is a game Apple can compete in for profit. Amex has a 6% back card with annual fee for groceries. You can get 5% back cards for Amazon, gas, and Lowes. Uber has a 4% card for restaurants, and there are multiple 3% restaurant cards. There are multiple cards that amount to 2% on everything everywhere. Most of these cards have sign up bonuses on top of their rewards. All of these are loss leaders to try and entice customers into a particular set of services.

    The paradox Apple may face is that a majority of people interested in Apple Pay will have very good credit ratings, and thus be eligible for all of these "loss leader" 2-6% back rewards cards. Sure, they could offer a good percentage towards itunes stuff, but itunes gift cards can already be had at an enormous discount from their face value.

    I don't know where the money is here for Apple.

  9. Clueless about banking by sjbe · · Score: 1

    I know 2 people who use Apple pay and I'm fairly certain 1 of them has stopped completely. Both are hopeless fanboys who will jump through any hoop and take any abuse.

    I use Apple Pay fairly routinely when possible. I like it quite a lot and use it preferentially over my credit cards. Personal preference of course. Anyway your (and my) anecdotal stories don't really mean anything.

    However this could easily be the end of Apple Pay, Apple presently is maintaining the line it's not a bank, therefore does not need to comply with the myriad of banking regulations in the jurisdictions it operates this service in.

    Apple isn't a bank. It doesn't even remotely resemble a bank. Facilitating financial transactions does not make a company a bank. I think you are letting your bias lead you to unsupported conclusions. Apple would have to do a LOT of things they don't do now to become a bank.

    One Apple start issuing cards, it's going to be difficult to claim that they're not in the financial services industry and not subject to regulations.

    Actually it wouldn't be hard at all since odds are Apple would not be the one actually issuing the cards. Most likely they'll partner with an actual bank who does the heavy lifting just like most companies. Amazon offers a credit card but they certainly aren't a bank and no one is accusing them of trying to be one.

  10. I like Apple Pay but YMMV by sjbe · · Score: 1

    I do not find Apple Pay convenient to use for in-store transactions over standard plastic cards, though I understand that if I had an Apple Watch that it's pretty spiffy

    I do. Reasons why? 1) I don't have to get out my wallet, 2) I don't have to show ID or (usually) sign anything, 3) the merchant never gets my account information and thus they cannot lose it or have it stolen, 4) It's generally as fast or faster than using a plastic card, 5) Stealing my phone doesn't result in someone getting access to my credit cards, bank cards and other wallet contents, 6) I don't have to make physical contact (germs) with a cashier.

    Now if those things don't matter to you, that's fine. I'm not judging. What works for me might not work for you. But I REALLY like being able to use my phone to handle transactions like this and cannot wait for the day when I can leave my stupid wallet at home most of the time. Apple Pay (and google's equivalent) check the boxes for me on how I like to do things.

  11. Eyeroll... by sjbe · · Score: 1

    I use cash wherever I can, because not giving any personal data or any of my money to megacorps who don't pay their fucking taxes rocks.

    Boy you are really sticking it to The Man there. I'm sure you never actually buy anything from a company that isn't a local mom and pop store that makes all their goods on their farm. Oh wait, you're using a computer made by a large megacorp that doesn't pay taxes to type this so I'm calling bullshit on your fake moralizing.

    1. Re:Eyeroll... by Rosco+P.+Coltrane · · Score: 1

      What part of "whenever I can" don't you understand?

      --
      "A door is what a dog is perpetually on the wrong side of" - Ogden Nash
  12. Re:Obvious answers by Presence+Eternal · · Score: 1

    Can you provide a source on that 3-4% number? My understanding is it averaged out to only 1.5%

    My point was that they'll either offer a card no one will use since it would literally cost them money, or have to offer such high rewards they'll lose money. Apple play takes in I think 0.15% my understanding is that it's only from a temporary agreement with card issuers.

  13. Re:Tap to token by ennis99 · · Score: 1

    Can I continue to use my traditional debit or credit or prepaid card if I delete or suspend my cards in Wallet? ____________________________________________________ https://dltutuapp.com/ https://kodi.software/ https://luckypatcher.pro/