Apple Pay Suica Needs a Inbound PR Campaign, in English

Apple Pay Suica Inbound first time user experiences are endlessly fascinating and educational. What’s obvious and works for people who live in Tokyo, isn’t the case for visitors. The Cup of Tech podcast from July 16 highlights the frustration of not being able to pay for everything with credit/debit cards, and a positive first time Apple Pay Suica use experience.

The 5 minute mark is the tech low point: the state of cashless payments in Japan, but there is no color on what kinds of stores or businesses did not accept credit cards, and the comment about using PASMO and Suica for payment is weird: “It’s usually one or the other, it’s not both…. so I guess you have to have both.” I guess Zach never figured out that Japanese transit cards are compatible with each other.

The 6 minute mark is the tech highpoint: using Apple Pay Suica which Zach assumed he could not use because he read somewhere that, ‘you could only do this on phones sold in Japan.’ Fortunately he found out that his Apple Watch works with Apple Pay Suica and discovered the joys of using Suica Express Transit and recharging with Apple Pay on the go.

Both experiences make it clear that most people visiting Japan with global NFC iPhones are completely unaware of Apple Pay Suica and the ease of adding it to Wallet with the super simple SuicaEng app (which Zach highlights in a later podcast). I know because in 2 years of hosting a Apple Pay Suica guide, the page view analytics show that not many people are actively searching for Apple Pay Suica information in English.

JR East has done many Apple Pay Suica campaigns aimed at Japanese commuters, it is time that JR East and Apple create an English language Apple Pay Suica campaign for tourists that covers the ease of adding it and using it. Plaster the stations, wrap the trains. Waiting to do everything in 2020 for the Tokyo Olympics is waiting too long.

Update: I forgot to mention that a campaign from JR East and Apple can also help counter the 7pay QR Code security meltdown scandal that has poisoned contactless payments for everybody, even for FeliCa NFC, which has a long successful security track record and absolutely nothing to do with QR.

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Growing the Global NFC Footprint

One of the challenges facing Hong Kong Octopus Card expansion to digital wallet platforms is the fragmented state of Android hardware and the small footprint of Android global NFC devices. There are lots of devices that can do NFC-F because it is required for NFC certification, but there are far fewer global NFC ‘it just works’ devices. As always Reddit user FelicaDude has the definitive explanation:

There are millions of NFC-F phones and devices outside Japan. That is because Type A and FeliCa are core requirements for NFC certification. If a phone supports NFC, it supports FeliCa.
What is required to be compatible with most payment terminals in Japan is an Osaifu-Keitai provisioned secure element: that can be a SWP-enabled SIM card (not available yet), the Mobile FeliCa chipset with embedded SE, or an iPhone 7 provisioned for Osaifu-Keitai.
The international iPhone 7s can do basic FeliCa read/write without encryption, because they embed a FeliCa-capable CLF <contactless frontend>. Apple has chosen not to provision them with Osaifu-Keitai keys, probably to avoid paying royalties to FeliCa Networks for each device.

The good news for iPhone users is that Apple went global NFC with iPhone 8/X/Apple Watch Series 3 and later by implementing the complete FeliCa secure element (SE) package with keys on the Apple A Series and S Series chips. The important thing to remember is that Apple does this without any dedicated FeliCa chip, it is Apple hardware top to bottom. This means that Hong Kong already has a large footprint of Apple devices ready to use Apple Pay Octopus from day one.

The bad news for Android users is that a similar global NFC packaged Android device doesn’t really exist yet. All-in-one off the shelf global NFC chip packages like the NXP PN81 are new to the market, but the standard practice to date has been adding a dedicated FeliCa chip to a smartphone model only in the markets that need it, like Japan.

The Google Pixel 3 has the global NFC ready NXP PN81 but has not used it for FeliCa support, going with a separate hardware model for Japan. The Pixel 4 leaks so far have not offered any NFC information. The success of Pixel 3 in Japan guarantees that at the very least, Google will offer the same deal: a Pixel 4 FeliCa chip model for Japan.

If Google is smart, Pixel 4 will activate and leverage the entire range of PN81 global NFC functions for all models, or have its own embedded secure element on a Google custom chip similar to what Apple has done. Even with that in place, and even if Google Pay Octopus was a reality, the footprint of Octopus ready Android devices in Hong Kong is far smaller than iPhone and Apple Watch.

The global NFC iPhone and Apple Watch footprint means that lots of people in Hong Kong, or visiting Hong Kong can add Octopus to Apple Pay when iOS 13 arrives this fall. I predict 2 things: Apple Pay Octopus will be as successful in Hong Kong as Apple Pay Suica in Japan, and Apple Pay Octopus launch day will experience a similar stamped of online users that nearly brought down Apple Pay Suica iCloud back in 2016. It will be interesting to see what Octopus Cards Limited does with that success and how it grows the global NFC footprint.

UPDATE
FeliCa Dude has answered and posted the definitive take of iPhone 7 FeliCa support for all things from Octopus to iOS 13 Core NFC. We own him thanks for taking the time to cover all the angles in such detail.

iOS 13 Apple Pay Suica: Move along folks there’s nothing to see here…

As I wrote previously, “if you are using iOS 12.3, you are already using iOS 13 Apple Pay Wallet.” The major under the hood Wallet changes of iOS 12.3~4 were completed ahead of iOS 13 for the Apple Card rollout that is coming very soon. For Apple Pay Suica users, and Express Transit users everywhere, the solid Express Transit performance of iOS 12.3~ iOS 12.4 and the UI, are exactly what you get in iOS 13. There is nothing new, a good thing.

The only changes are Suica Notifications which have lost 3D Touch shortcuts for Recharge and Commute Plan Renewal. Since 3D Touch is on the chopping block in iOS 13, this is not unexpected, but it is unfortunate: the recharge shortcut was handy and finally useful with the robust iOS 12.3 Suica Recharge performance. Suica Notifications are still a work in progress however, witness the useless ‘In Transit’ Suica notification, hopefully shortcuts will reappear in some form before the final release.

The Apple Card rollout remains a real head scratcher. There are lots of things Apple Card will be able to do in iOS 12.4 Wallet that other cards, as yet, cannot do. And Apple has not offered anything in iOS 13 PassKit or Wallet for developers to do those dynamic card UI things that Apple Card does. I wonder how well that will go down with developers after Apple Card finally ships.

iOS 13 and the Transition to Global NFC

Crowd Cast president Takashi Hoshikawa updated his Japan Cashless map introduced back in January, the cacophony of QR Code payment platforms continues to grow. Just like any gold rush, QR will crash and burn at some point. Big players will gobble up the smaller ones and things will settle down.

But something else is going on. There’s a small but important difference, so small that Takashi Hoshikawa is not aware of it: he labeled the FeliCa section in the upper left corner as NFC.

This is the result of using Apple Pay on a global NFC iPhone where all the necessary hardware and software is seamlessly unified. The old plastic card mentality of different walled off technologies: contactless credit card (EMV), transit card (FeliCa, MIFARE), ID card (ISO 7816), NFC A/B or F, etc. slips away and becomes one seamless NFC Wallet in the mind. This mindset is also on display in SearchMan co-founder Naoki Shibata’s recent article on Rakuten Pay Suica: no mention of FeliCa anymore, it’s just one NFC thing.

This is an important and natural, but quiet progression that will accelerate with the enhanced NFC support in iOS 13 and expansion of new services like Apple Pay Octopus. iOS 13 Apple Pay Wallet will set the standard for global NFC that just works, a standard that Google Pay will struggle to match because of Android hardware fragmentation.

Players that leverage the advantages of global NFC and offer new services based on them, like JR East (Inbound Apple Pay Suica), and Mastercard (NFC switching dual mode bank card services) will gain, while companies that stick with the old ‘one thing’ contactless plastic card mentality, like Visa, will lose. It’s that simple.

Apple Pay Octopus and the future of the Octopus Transit Platform

UPDATE: Hong Kong OCL officially announced Apple Pay Octopus

One downside of breaking a tech story on the internet is news aggregator sites. Responsible tech news sites like MacRumors and AppleInsider post outside sourced news that serves their readership and sends traffic to the original source. And then there are not so nice aggregator operations posing as news sites like The Verge, TechCrunch and 9to5Mac who craft crappy posts, lifting whole chunks from outside stories, or simply lifting without attribution, minimizing any outside contribution to keep traffic on their own site.

So it’s a bummer that SC Yeung’s excellent EJ Insight story “Why Hong Kong can expect Apple Pay support for Octopus Card,” quotes the 9to5Mac ripoff of my piece instead of the original, but it’s an interesting read with good analysis. Yeung makes the same point I did a few months ago that the expansion of Octopus to Apple Pay is an important step forward for the platform. But it can’t stop there: Octopus Cards Limited needs to continue digital wallet expansion and create new business opportunities. Unfortunately it has to accomplish this while parent company MRT Corporation is opening up its transit gates to QR Code and EMV payments which will compete with the subsidiary OCL Octopus card business:

MTR will begin accepting QR code payment starting from next year and the rail operator will also add more contactless payment systems on its gates in future. For commuters, Octopus Card will no longer be the only choice for MTR payments…

<It> is becoming clear that <OCL> needs a new business model to maintain its market-leading position. Using a specific card for payment is no longer a modern way of payment. The core issue for Octopus is transform into something bigger, moving beyond the current payment functions and offer a lot more, perhaps even a mobile banking service, to retain users.

Why HK can expect Apple Pay support for Octopus card

JR East has taken a very different approach. Suica is a central business pillar and JR East will be expanding it with the next generation Super Suica in April 2021. Suica will gain the ability to virtually host other transit card under the same Suica umbrella on plastic and on mobile. Think of it as a national transit and payment card with Express Transit anywhere, anytime. How fascinating it would be if Octopus had a similar kind of opportunity to expand outside of Hong Kong.

Even from the short vantage point of 2.5 years since the launch of Apple Pay Suica, it’s already easy to see the charges that it has brought to the Japanese payments market. It will be interesting to watch the changes that Apple Pay Octopus brings to Hong Kong.