Apple To Sell Square Mobile Payment Readers In-Store & Online, Delays Plans For NFC

It was announced recently that Apple will begin selling readers from mobile-payment startup Square in its Online and retail stores.  With the surprising announcement, however, what does it mean for Apple’s alleged NFC efforts? Square’s devices, which are normally offered for free and work together with the company’s iPhone/iPod Touch and iPad apps, will be …   Read More

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It was announced recently that Apple will begin selling readers from mobile-payment startup Square in its Online and retail stores.  With the surprising announcement, however, what does it mean for Apple’s alleged NFC efforts?

Square’s devices, which are normally offered for free and work together with the company’s iPhone/iPod Touch and iPad apps, will be offered in Apple retail stores starting this week, according to both companies.  The devices are already available in Apple’s Online store.  The cost from Apple will be $9.95, though users purchasing the device from Apple will receive a $10 credit on their account.

It’s still unclear what the details of the agreement are, but Square is likely losing money on the deal.  Apple is likely taking a small cut on device sales, and with Square making up the difference for merchants by offering a credit, the primary benefit for Square is simply the valuable endorsement from Apple and the inevitable boost in usage derived from placement in Apple stores.  It should be interesting to see if Apple begins using Square devices for in-store transactions as well.

Square had a somewhat rocky start with device production being delayed and other issues, but COO Keith Rabois told TechCrunch recently that the startup is expected to process $40 million in transactions in Q1 of 2011 and is currently signing up 100,000 merchants per month.  That’s compared to 30,000 monthly signups last Fall.  With all the talk of NFC this year, especially surrounding Apple and its upcoming iPhone 5, this agreement is a big deal for both companies.

This raises another question as to what Apple has in store for NFC and mobile commerce in general.  Apple’s so-called commitment to NFC has been widely reported over the last several months, and the agreement with Square definitely calls that commitment into question.  Last month, The Independent reported that Apple has told executives at several U.K. mobile operators that it will not embed NFC technology into the forthcoming iPhone 5, citing apprehension over the absence of clearly defined industry standards.  It’s believed that Apple engineers continue to work on an NFC solution, however earlier this year, Bloomberg reported that the computing giant’s mobile wallet efforts likely will leverage Apple customer information already on file, e.g., credit card account numbers, iTunes gift card balances and bank data.

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