What’s that sound? It’s the sound of Samsung battling along with Apple again. No surprises there, then. These two corporate giants have been fighting for years when it comes to everything mobile. The growing markets of Asia often favour Samsung and the existing markets of the US, and much of Europe prefers Apple. The world has been split into two camps.
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In the latest instalment of this tech war, Samsung purchased LoopPay. We’re going to take a look at why Samsung decided to buy this mobile wallet start-up in order to continue its campaign against Apple.
#1 Falling Behind
To start with, we have to remember Apple already has a big head start on Samsung when it comes to mobile wallets. Practically everyone in the technology sector does. Not only is Samsung competing with Apple Pay, it’s competing with Softcard and Google Wallet.
Samsung had to act by purchasing LoopPay so it can compete on all fronts.
#2 The NFC Network
The NFC network is how mobile payments work for Apple Pay. NFC signals exchange the relevant payment information to complete the transaction. From a business point of view, this is an expensive system to install in retail settings. It’s why you’ll only find Apple Pay in 220,000 points in the US.
LoopPay has an advantage over Apple, which Samsung will now take advantage of. It uses a magnetic stripe reader instead. This removes the need for NFC and the kick in the teeth for Apple is practically every store can have this facility at an affordable price.
#3 Mobile is King
50% of all Internet traffic now runs through a mobile device. This means many people are shopping from their devices as well. Mobile shopping is expected to continue to grow and thrive. It’s a growth industry. Samsung chose LoopPay because it’s a well-developed entity that enables them to make in-roads into this lucrative trade straight away.
Those who can’t compete when it comes to mobile eCommerce will find themselves being left behind in the dust of their competitors.
#4 Into the Banks
Apple Pay enjoys its success because it’s managed to cultivate relationships with public banks. Any newcomer to the sector would face a mountain when trying to have their mobile payment platforms accepted. LoopPay was the perfect acquisition for Samsung because it boasts 60 million active accounts. Plus, it can now get accepted by a number of providers because Samsung already works with Visa and Synchrony Financial.
Essentially, this acquisition has brought together the power of banks and credit card providers with an already active mobile payment service.
#5 Investor Interest
LoopPay isn’t some service that Samsung has dragged out of obscurity. Some would argue Samsung has chosen the perfect time to make a move to acquire the start-up. It already has investor interest as it’s recently managed to raise $13 million USD through crowdfunding. What we also have to remember is that Visa endorsed the service and provided an unspecified amount in funding to help get it off the ground.
Much of Samsung’s work in building this service has already been carried out for them prior to the acquisition.
The War with Apple
While there are pros and cons to both Apple and Samsung services, this will undoubtedly drive innovation at a faster rate. For the consumer looking to take advantage of mobile payments, this is the best news they could hear. Competition breeds creativity and there’s no doubt we’ll start to see mobile payment platforms becoming a greater part of our lives in the coming years.
Do you think that LoopPay will be more successful than ApplePay? Your thoughts and comments below please...