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Businesses The Almighty Buck Apple

Apple Prepares 'Apple Pay' Credit Card To Offset Slowing iPhone Sales (marketwatch.com) 85

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.
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Apple Prepares 'Apple Pay' Credit Card To Offset Slowing iPhone Sales

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  • Really? (Score:3, Insightful)

    by methano ( 519830 ) on Thursday May 10, 2018 @11:48PM (#56593014)
    Really? Is there no Apple news that can't be twisted into an "Apple is dying" story?
    • Re:Really? (Score:5, Insightful)

      by Anubis IV ( 1279820 ) on Friday May 11, 2018 @12:08AM (#56593084)

      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.

      • 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.

        You can say that Bloomberg article came out a week before the quarterlies. But they nailed the production numbers and here is t

        • 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 o

        • 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!"

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

        • 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 o

      • 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 t

        • by Gorbag ( 176668 )
          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 m
      • 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.

    • by Mashiki ( 184564 )

      Well it might kill Apple, the same way it nearly killed GM, Ford, Chrysler, Toyota, Mazda, Fiat, Nissan and so on nearly a decade ago. Those companies all nearly failed because they had accumulated massive debt due to faults in automotive loans under their own branding, which the parent company was unable to cover(aka bad credit). And before someone goes "but Ford didn't get any bailouts..." they sure did, it was under a different title application called TALF and got $2.1B more then GM did to stop insolv

      • by Anonymous Coward

        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 [cnbc.com], is at the same time under such crippling debt that it may destroy them?

        • by Mashiki ( 184564 )

          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.

    • by MouseR ( 3264 )

      It worked for the past 30 years.

    • 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

      • 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

      • by wwphx ( 225607 )
        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
    • 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.

  • Have they considered just lowering the damn price?

    • 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.

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

    • Have they considered just lowering the damn price?

      Many status symbols are Veblen Goods [wikipedia.org]. 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.

      • Have they considered just lowering the damn price?

        Many status symbols are Veblen Goods [wikipedia.org]. 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.

      • by Dustie ( 1253268 )

        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.

    • Have they considered just lowering the damn price?

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

      Now what?

  • Fake News (Score:2, Informative)

    by SuperKendall ( 25149 )

    Apple iPhone sales are not slowing down [cnet.com] but competitors are [thesun.co.uk]...

    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?

    • 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.

  • by Kozar_The_Malignant ( 738483 ) on Friday May 11, 2018 @12:06AM (#56593074)
    It's more about capturing revenue that currently goes to Barclays. It's also about spreading the Apple Pay service.
    • by mjwx ( 966435 )

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

      Its about trying to get people to use a service they have no use for.

      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.

      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. Right now they can claim that as Apple

      • by wwphx ( 225607 )
        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 guarantee
        • 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.

        • by kalpol ( 714519 )
          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.
      • 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 wou

  • 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.

    • 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.
    • 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.

      • 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.

  • "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?
  • 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 th

    • 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.

      I have one of those cards. They make money because they charge the merchant 3-4% on most transactions. And no they are not all loss leaders.

      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.

      You're wondering where Apple will find profit in selling data? Seriously? It has effectively ZERO marginal cost to copy. The answer to this is self evident.

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

      Literally every single transaction will be a cut for Apple. It won't be their primary line of business but they could easily make a tidy profit with good margins on it.

      • 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.

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