Apple, responding to an increasingly hostile digital commerce market, is taking steps to upgrade the POS systems and hardware on its most popular smartphone devices. On all new models of the iPhone 5S, Apple is installing a VeriFone Systems Inc. point-of-sale shell. The shell works to block out any unwanted signals from intercepting sensitive information from users’ phones, while improving the security of any data sent from the phone as well.
With the implementation of the hardware, Apple hopes to push its customers one step further away from using credit cards, the magnetic strip of which can easily be scanned and duplicated for fraudulent purposes, and many steps closer to using near field communication (NFC) payment technology. Through the combination of an on-board pin input device and a payment system that works by beaming payment information from chip to chip, not card to receiver, Apple looks to stem the tide of companies waking up to find some industrious hacker has stolen a boat-load of credit card information.
Why Apple Made the Upgrade Now
And that really points to why Apple made the upgrade now. Just as mobile payment POS solutions arose to meet customer desire to not pull out their cards and instead pay with their phones, thereby improving security, the VeriFone upgrade represents a preemptive strike on Apple’s part not to become another Sony or Target. The latter saw 400 million credit card numbers stolen from its “secure” servers during the holiday season last year. Needless to say, the sort of hit to consumer confidence that comes with an event like that is something Apple rightfully wants to stay far away from.
More Company’s Need to Take Similar Steps
While Apple’s moves should be lauded by stockholders, employees, and customers, the fact is that too few companies are making similar moves. According to the Identity Theft Resource Center, fraudulent activity picked up by an estimated 30% from 2012 to 2013. In total, all forms of cybercrime cost the U.S. economy, both its businesses and private citizens, $100 billion a year. Every company, whether its a behemoth like Apple or a mom-and-pop online craft store, needs to take similar steps — assuming, of course, they want to protect themselves and their customers.
What do you think of Apple’s upgrade? Is it a step in the right direction for safer digital age commerce? Let us know what you think in the comment section below!