That's what they may be now. Credit card Interchange rates change monthly.

They could, but they'd shoot themselves in the leg because nobody would want a phone where you couldn't make standard Visa/MC transactions. Visa/MC are much larger and more influential than Google, Apple, and Microsoft combined, when it comes to payments. You can pay for shit without Google, Apple, or Microsoft, but you can't without Visa/MC.

Hey fucktard! Apple isn't doing this for free. Use your brain!

Apple doesn't charge Merchants; it charges BANKS.

Oh, and I'm sure the banks are doing it for free and won't change the rate on Apple Pay payments like they constantly raise the rates on regular cards. I love how banks are always giving away free things!!

No, American Express goes through the same network. That's why it's more expensive than Visa/MC. When you get a merchant account, you get another American Express merchant number that you plug into wherever you're processing Visa/MC.

If your customers like it then it is not pointless. Furthermore most merchants either already have the tech or will have it within the next year. The costs get passed on to customers anyway so the only relevant comparison is if one merchant is getting a better deal than another merchant. If both accept the same methods of payment then there is effectively no cost to the merchant at all. You need to familiarize yourself with the concept of Incidence of Payment.

Or the ones that don't accept the payment are going to save a percentage point or more annually. It's not in any way free.

Because it won't be just a few phone enthusiasts. Have you not paid any attention to the effect Apple often has on markets it enters? ApplePay is easy enough my mother can use it and I assure you that she is no "phone enthusiast" and certainly not a techie. If you need an example, walk into any Starbucks and watch how many people pay with their phones. And that process is MUCH harder than ApplePay. People LIKE this tech and they'll use it.

The number of people who will not shop somewhere because they can't swipey their phones will in no way measure up to the additional cost Apple or Google or anybody is going to take off the top.

I think you're really underestimating how much this is going to cost. A brick and mortar retailer operating on razor thin margins isn't going to give up that much in sales just so a few phone fanatics can go "neat!" at check-out.

Yeah, nobody writes apps these days. That'd be crazy.

I fully expect ApplePay to get copied in part or in whole by the Android and Windows ecosystems.

Nah, what's going to happen is Visa/Mastercard is going to do it themselves, and cut out all of the middlemen (Apple, Google, etc.)

Anything Apple might charge will be a rounding error compared to the 3-5% the credit card companies charge merchants.

90% of sales in brick and mortar stores are card-based (as opposed to cash). No sane merchant is going to give up 0.5%-1% of total sales or whatever Apple ends up charging so their customers can have a "gee whiz neato" moment at check out.

And no, it's not 3-5%. It's closer to 2-2.5% for medium and large sized merchants.

That's not a sane decision. You're wasting four minutes in order to save a (perceived?) few seconds at the store at the point of payment. Most people are not going to make such decisions.

Except that Apple Pay is at contractually negotiated rates,

Yes, Apple will continue to provide this service for no cost, and the card processors will continue to absorb the fraud for no cost.

You have never had a merchant account. There's a fee increase from Visa/MC almost monthly for something or another. The fees will skyrocket, and anybody dumb enough to be using Apple Pay will pay "card not present" or more very shortly, I'm sure. It's low now to suck people in, but they'll get walloped with the fees soon, I'm sure.

Except that you could switch out "Apple Pay" for the upcoming "Samsung Pay" or "Google Wallet" or "Contactless Payments" and still have the same problem.

Absolutely. Contactless is pointless and expensive as fuck for merchants. I can't imagine many businesses where the "neat-o" factor from a few phone enthusiasts to be able to pay with their phones is going to outweigh the costs.

It's easier to punch stolen numbers into a phone than it is to print up an actual card. When chip + pin happens, all of the criminals will be using Apple Pay.

Why would a merchant trust a computer manufacturer or a search engine company with payment processing in the first place...?

Actually, some laws were recently passed that puts even more liability on the merchant and less on the processors. Any smart merchant is going to run from Apple Pay and everything else that isn't chip + pin (come this October).