Free Mobile Suica for Everybody in 2020

JR East announced the end of the Mobile Suica ¥1030 annual membership fee for all Android devices on February 26 2020. Mobile Suica is free for Apple Pay users. JR East also announced the end of Symbian OS feature phone support with most devices being cut off from Mobile Suica on February 25 2020, and the rest following on December 22 2020 along with some Android devices.

All of the ‘offed’ devices can still use Suica for transit and purchases but are limited to cash recharge which can be done at station kiosks and any convenience store. Users who want to keep their Mobile Suica account will have to migrate to an eligible Apple or Android device.

JR East is also terminating Mobile Suica Shinkansen e-ticket purchases this year and will replace it with a new service similar to JR Central’s Smart EX. Details should be coming soon.

All in all it looks like JR East is clearing the Mobile Suica deck for the 2021 Super Suica launch.

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Japan Cashless Map for 2019

The Crowd Cast cashless map illustrates the rich variety of Japanese payment platforms

Because of its long history pioneering many of the technologies used for contactless payments, Japan is one of the most interesting, complex and difficult markets to study and analyze cashless payment trends. Accurate analysis of Japanese cashless/contactless payment trends is challenging because of fragmentation and regionality. Every market report or survey is just one tiny fragment of a much larger moving picture. An accurate map is good starting point.

Fintech startup Crowd Cast, Ltd. CEO Takashi Hoshikawa has a blog and posted a handy helpful cashless map for 2019. It’s not perfect however so I tweaked it a bit to clearly outline the 3 basic cashless groups: plastic cards, NFC, QR.

Digital wallets like Apple Pay and Google Pay work with all the NFC flavors (A-B-F) but Apple has made a much deeper investment integrating FeliCa into the basic technology bundle that powers Apple Pay alongside EMV, delivering it globally as a payment solution that “just works”. EMV contactless is called NFC Pay in Japan and is slowly being deployed alongside existing FeliCa payment networks so that POS systems and readers “just work” with everything. Hopefully it will all be up and running in time for the 2020 Tokyo Olympics.

QR Codes are not big outside of China and I don’t see conservative markets like Europe or the US taking them up. Japanese QR Code payment platforms are cropping up thick and fast but availability has not translated to actual use. ICT Research & Consulting has released a market report on mobile cashless payments (for ¥95,000) that basically covers 2018 with a web survey of 4,062 participants. The teaser page offers a few interesting free data tidbits. I don’t trust web based surveys as a tool for analyzing a highly regional and fragmented market, but the cash vs cashless chart illustrates exactly what I wrote in the Apple Pay Japan One Year Mark: people use contactless payments like Apple Pay for coffee and train fare but do not use Apple Pay for buying a couch. However the chart offers an interesting point: Japanese people use (plastic) credit cards for larger purchases and cash for smaller ones.

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The Apple Pay Japan Story so far
Japanese IT journalist Junya Suzuki predicted that Apple Pay would be the ‘black ship’ that would revolutionize contactless payments in Japan. Apple Pay turned out to be the match that finally lit the fuse of the huge Japanese contactless transit and payments infrastructure investment and launched it into orbit. The global FeliCa iPhone is a inflection point that many people have yet to recognize, one that will soon provide Apple Pay another growth opportunity in Hong Kong. A year ago I wrote:

Apple Pay in Japan is all about Apple Pay Suica which we already knew. In the Suica home base area, the Kanto region, contactless payments grew from 20% of total transactions to more than 40% in the year that Apple Pay Suica has been available… What used to be ‘some people some of the time’ is quickly transitioning to ‘most people most of the time’.

Stores and businesses interviewed for that post report that contactless digital wallet payments (Apple Pay, Google Pay, Osaifu Keitai) use continued to grow throughout 2018 but nothing is simple or straightforward:

  • Apple Pay Suica continues to drive the Apple Pay story in Japan but is highly regional as initial uptake is tied to commuter passes which are currently restricted to the JR East rail network. Nevertheless Suica issuance continues double digit growth. Japanese customers prefer easy to use prepaid cards, they will always be the gateway to cashless for the majority.
  • Only 30% of iPhone users with Apple Pay Japan capable devices (iPhone 7 and later) use Apple Pay. I suspect Osaifu Keitai and Google Pay uptake is similar or lower.

The upcoming 10% consumption tax increase will offer incentives and tax discounts for cashless purchases. The cash vs cashless trends outlined above are positive signs that change is possible with the right set of incentives and ease of use environment:

  • Plastic will continue to be king with prepaid cards the king of kings. One of the many advantages that digital wallet platforms like Apple Pay have over QR Code platforms is that plastic cards are always there as a last resort physical option. This is very important for many customers, especially the elderly. And they don’t need a battery.
  • Reward point systems and cards need to be digital (such as VAS powered Ponta) that automatically link with the appropriate transactions. Digital wallets only replace physical ones when everything can be matched and loaded on smartphones.

For Apple the key will be getting more Japanese iPhone customers to use Apple Pay by making different service parts work together in new ways that don’t play together well, i.e. the sum must be greater than the total of the parts. Think Rakuten. Rakuten has done an excellent job building an ecosystem of e-commerce, travel reservations and other services that offer members large discounts and points. This approach will pay huge dividends when the 10% consumption tax arrives October 1.

Smart Octopus Samsung Pay Updated Image Hints at Apple Pay Smart Octopus Launch

Samsung has updated their Smart Octopus on Samsung Pay advertising. The tag line used to read “only on Samsung Pay“, the updated tag reads “First Smart Octopus in Samsung Pay“. The Samsung Pay Smart Octopus exclusive window is over. I think we are getting very close to a Smart Octopus Apple Pay launch possibly coming with the iOS 12.1.3 update.

Unlocking JP Carrier iPhone SIM Lock

All Japanese carriers offer free SIM Lock unlocking service 100 days after purchase or 100 days after a previous SIM Lock unlock of the same contract mobile number, which ever comes first. Day 1 iPhone XS users are just past the 100 day mark, I successfully unlocked my Docomo iPhone XS SIM today. You can do this at your local carrier store for ¥3,000 but it’s free when you do it online via My docomo, My SoftBank, My au. Have your iPhone IMEI number ready: go to Settings > General > About and scroll down to the IMEI number to copy it. Be sure to remove any spaces between number groups so it is one unbroken number string.

I don’t know about SoftBank or au. Docomo is a little sneaky because they hide the SIM Lock removal option in the iOS My docomo app. You can only access it from My docomo web site. The page and procedure is Japanese only but there is an outline of the procedure and conditions in English. Here are screenshots of the process in case you get stuck.

Copy the IMEI number (no spaces) here
Confirm the SIM Lock unlock item is checked> in the lower box click the blue URL for Terms and Conditions then check the blue box item directly below.
Confirm your email to receive confirmation
Confirm the iPhone and IMEI information and email address them click/tap the final button to process the SIM Lock unlock procedure.

Apple Closing Store in Sendai

The bad news from Apple keeps on coming. The Apple Store in Sendai is closing January 25. A cost cutting move already? Relocation?

Update
9to5 Mac has the details, the older smaller space doesn’t fit with the modern store design that Apple wants for Japan. A reader sent the following comment:

I think the closure is due to the need to complete redesign the store to fit the new style. However either they cannot find a reasonable larger space to move into, or the foot traffic in Sendai doesn’t support the cost for the upgrade.

Sendai is almost as large as Nagoya, an economic hub city serving the Tohoku region. Hopefully Apple can eventually find the right location for a modern Apple Store.