I suppose I should care about the latest ‘Apple Pay is evil’ brouhaha piece by CNBC “Apple is sticking taxpayers with part of the bill for rollout of tech giant’s digital ID card” by Hugh Son and Kif Leswing which appeared more or less at the same instant as “What Apple’s Secret DMV Contracts Tell Us” on Jason Mikula’s Fintech Business Weekly Substack newsletter.
But I don’t. In this age of shut up when we tell you to shut up big corporate and social media, I get suspicious when east coast journalists start trolling a big new ‘scoop’ at the same time. Why now and why these guys? Why do they ask the same questions? Do they hang out at the same bar and share story notes, or did somebody feed them the story and the sources? Both pieces outline some of the agreements Apple made with states and the restrictions/conditions Apple has in place to provide ID in Wallet for driver’s licenses.
When a story like this breaks from multiple outlets just before a service launch, and there is every indication Apple plans to release ID in Wallet with the iOS 15.2 update, I smell somebody’s agenda. A somebody who wants to upend Apple Pay’s ID in Wallet launch cart. This is the way to do it.
As Mikula is a former Goldman Sachs guy where he learned how to fleece things, he provides important context to the story that CNBC does not:
Multiple ID verification (“IDV”)…is big business — according to a company in the space, Mitek Systems, it was worth an estimated $7.6 billion in 2020 and will grow to nearly $16 billion by 2025. Socure, a company offering IDV services, just raised $450m at a $4.5 billion valuation — an increase in value of ~2.5x from earlier this year.
What Apple’s Secret DMV Contracts Tell Us
I wrote about iOS 15 ID in Wallet earlier this year:
There is another aspect to consider, one that Apple certainly won’t divulge: who manages and runs the backend centralized mobile ID issue service that plugs into Apple Pay servers…There has to be a partner service company that sub-contracts mobile ID issue services to participating state governments…somebody that does the heavy lifting of linking various state database servers to provide a centralized card issuing service so that Apple can provide a seamless ID add card experience. But it must be an independent entity that can provide the same set of backend ID issue services to other digital wallet platforms (Google Pay, Samsung Pay, etc.) at some point. Because if it is not an independent entity providing those services, Apple is inviting more claims that Apple Pay is a monopoly. It’s a mystery worth digging into.
Secrets of iOS 15 Apple Wallet
Beyond defining Digital Identity Credentials that are the key part of the ‘restrictive’ agreements between the states and Apple, there are no system details. Nada. Certainly nothing like the system diagram from the Japanese Ministry of Internal Affairs and Communications (MIC) English PDF document: First Summary Toward the Realization of Electronic Certificates for Smartphones, that outlines how the digital ID system architecture for the Individual Number Card (My Number) works. A white paper from Apple explaining how ID in Wallet works both on the device and in the cloud, is key to understanding how secure ID in Wallet is, and how restrictive the agreements are. Without one, Apple puts itself, and Apple Pay ID in Wallet at risk in the political environment that is state government contractor relations. Asking users to simply trust a black box doesn’t fly in this security risk adverse, privacy conscious age.
As nothing has been released yet, and we have no white paper or anything else from Apple, I think discussion is pointless at this point. Questions are a good thing but are CNBC and Mikula asking good questions? I think the sudden ‘we’re protecting the tax payers and good citizens’ angle is highly suspect when CNBC has been a highly partisan mouthpiece always on the side of establishment government and establishment corporate America… a media company who asked nothing about big pharma’s role in the COVID hysteria driven vaccination program for example, or why Pfizer etc. are exempt for any and all side-effects of their experimental vaccinations, all while demonizing the good citizens who want those questions asked.
After all, privatization of government services is so entrenched at this point nobody really questions it anymore. Wouldn’t it be better to ask why states want to sign up for ID in Wallet, what they want to get out of it and why, why, why? Could it be that states want a successful digital ID service people will actually use? Not sexy enough I guess. If you ask me, I think some government contractor in the IDV business, and their supporters, stand to loose out in a big way if ID in Wallet is a success and used some connections to slam a media outrage ball into Apple’s court. Let the games begin.