The Weekly

July 27, 2021

The ‘Apple Pay is a monopoly’ soap opera continues

ZDNet reports Australian Parliamentary Joint Committee on Corporations and Financial Services hearings that are focused on, yet again, forcing Apple to ‘open up’ their NFC chip. Actually they should be talking about the secure element in Apple Silicon because that’s what Apple devices use and it’s not just about NFC anymore, it’s Ultra Wideband too.

The Apple Pay monopoly debate isn’t new and isn’t about being ‘open’, it’s about banks getting what they want from politicians. What I found interesting was the back and forth between Apple and Google regarding the hardware embedded secure element (eSE) vs. the virtual secure element in the cloud Host Card Emulation (HCE), a topic that confuses many ‘experts’.

Google is playing both ends here because they have different flavors of Google Pay for different kinds of Android devices. Google Pixel Google Pay uses eSE while everybody else use HCE Google Pay. One very important thing not mentioned in tech blog coverage is that Samsung Galaxy and the Chinese smartphones (Huawei, OPPO, Xiaomi) all use a custom eSE with their own XX-Pay. In other words, everybody on the Android side outside of low end junk is doing exactly what Apple Pay is doing.

Apple
Host Card Emulation (HCE) is a less secure implementation, which was adopted by Android … Apple did not implement HCE because doing so would lead to less security on Apple devices.

Google
Our payments apps are immensely secure…we would refute the suggestion our HCE environment is in any way insecure … I would argue the user experience on Google Pay is equal to that of Apple Pay.

Let’s see what GlobalPlatform has to say about HCE:

GlobalPlatform
HCE solutions can be a great option for issuers to get to market cost-effectively for their Android customers. However, they aren’t without their complexities. Rooted in the NFC device OS, HCE apps can be more vulnerable than the ‘Giant Pays’.

So HCE security is up to the payment app, shitty app = shitty security without Apple Pay Secure Intent. The whole HCE debate is nonsense, like FeliCa Dude says it’s eSE or nothing. If the committee thinks that HCE means open and good, they are showing their incompetence.

Apple Pay Wallet has a very simple rule: any card that loads a Java Card applet into the secure element has to reside in Wallet. Any card or developer that wants to loads applets and use the secure element has to have a PassKit Secure Element Certificate Pass. This is covered by NDA but a company called PassKit (not Apple) gives us an idea what Apple’s NFC/Secure Element Pass guidelines are:

Apple care a great deal about the user experience. Before granting NFC certificate access they will ensure that you have the necessary hardware, software and capabilities to develop or deploy an ecosystem that is going to deliver an experience consistent with their guidelines.

Yeah, the end to end user experience, the whole reason behind the success of Apple Pay. Banks don’t want to be told they need to improve their ecosystem for a better user experience, and they don’t want to pay a transaction cut to Apple that they are used to keeping for themselves. What else is new?

The whole ‘Apple Pay is a monopoly’ soap opera is overrated.


PASPY transit IC card migrating to QR

After thinking out loud recently about dumping their PASPY transit IC card in favor of a QR Code smartphone app, Hiroshima Electric Railway Co. Ltd (Hiroden) CEO Masao Mukuda announced that Hiroden would indeed junk NFC and migrate to a QR Code app over an unspecified period of time. Running their own transit IC card is too expensive, so old folks, school children and everybody else will have to use smartphone to ride Hiroden light rail trains in Hiroshima.

PASPY is just the tip of the iceberg. There are many transit IC cards out there with the same problem: fixed infrastructure costs supporting a small region transit IC card and declining ridership. Add the COVID crisis that has decimated public transit use and you have a business crisis. All the small transit cards outside of the Transit IC card standard (the pink box) are in the same boat: they can only be used in their respective regions, they don’t have e-money functions, they don’t have the resources to go mobile.

This is exactly the problem JR East is addressing with their 2 in 1 Suica MaaS soution. JR East hosts the hardware, the local operator issues a ‘localized’ Suica that offers both special local MaaS services (discounts and extras, etc.) and seamlessly plugs into the larger Suica and Transit IC map.

Suica 2 in 1 region cards are the keystone of JR East’s MaaS strategy

Unfortunately PASPY is in the JR West region which doesn’t have anything similar to the JR East MaaS program. It would be a perfect solution: customers would get a new card that works just like it does now but works everywhere with e-money and ICOCA benefits, Hiroden is freed from the costs of hosting and issuing their own card.

QR is not going to be the salvation that Hiroden hopes it will be. QR isolates Hiroden from the wider transit IC network of Mobile Suica, PASMO, ICOCA. Even if Hiroden gets rid of their card issuing business cost, they still have to host a system to run the QR Code app and manage accounts. The real rub is that instead of anybody buying an IC card out of a machine, Users will have to sign up for the app or buy a QR paper ticket. They also have to worry about where and how their account data is stored. My prediction: it’s going to be a messy money losing transition.


Heraiza down but not out

Poor little Heraiza, one of my favorite Japanese YouTubers, has been copyright claim ‘hacked’ from a fake account pretending to be Dentsu and now has 2 bogus strikes against her YouTube account. As an independent 17 year old high school student with 150,000 followers, she doesn’t have the resources of a YouTuber managment agency like UUUM, who she likes to badmouth (and I won’t put it past UUUM using fake accounts to take her out). Dentsu or whoever the real copyright holder is has confirmed to her that her content does not violate said copyrights.

Hopefully she’ll get it all worked out and unlock all her previous videos, though YouTube being YouTube, if they don’t like you they ban you…AND keep your ad revenue. In her most recent post about one of her favorite YouTubers having their account hijacked, she has her confidence back. Good thing, in these dark times we all need to laugh.

Have a good week and enjoy the Olympics.

The Weekly

July 27, 2021

With so little real news to write about these days, I’m trying out a weekly digest format instead of individual itty bitty posts. Sticking with a mundane regular schedule is also good practice, we’ll see how it goes.

Tokyo 2020 TP Transit Card
Foreign media (already in Japan as opposed to those coming for the event who are limited by protocols for the first 14 days) covering the Tokyo Olympics were issued a special ‘TP Card’ limited transit pass covering Tokyo region transit July 10~ August 11. Dan Orlowitz who covers sports for the Japan Times tweeted some pictures of the pass. Look carefully at the transit gate display screen, there are some very interesting things going on: (1) The display language is English (nice touch), (2) The card balance is 0. The card itself is issued by JR East and is a Suica commuter card with a 1 month pass and the balance turned ‘off’, that is to say that TP Card numbers are ‘block listed’ for any recharge function.

The TP Card shows a way forward for Transit IC (Suica, PASMO, etc.) that started with Welcome Suica: more flexible options, discount and special passes for all kinds of users and uses. The next important step will be getting these, along with 2 in 1 Region cards, on mobile.


Is Apple Pay Overrated?
What technology works and doesn’t work for people in everyday life is always a fascinating subject. Mike at Tech702 asks a good question: is Apple Pay overrated? For Mike in daily Las Vegas life, yes Apple Pay is completely overrated. I saw much of the same during my Salt Lake City summer stay in 2018, although Smiths grocery had just started taking Apple Pay at the time. Did they pull the plug? It’s a good reminder that retail chains and banks in America switch loyalties without notice and the payments infrastructure is all over the place, witness Targets changing their accepted credit card lineup when I was in Salt Lake.

Some snobby Europeans like to look down on America and other places they perceive as not being up to speed with contactless payments. The truth is when Japanese journalists like Junya Suzuki take a good look at state of European contactless payments, it’s not so great either. The state of contactless payments around the world is still very much a touch and go thing.


iOS 15 Beta 3 Score Card
iOS 15 reached beta 3 last week. Here’s how it’s panning out:

Apple Maps new cartography continues to evolve. Japanese roads were decolorized, railway lines are different and drawn in harder to see light blue. Overall I think dark mode is works better than light mode (better contrast, easier to pick out details, etc.). See Justin O’Beirne‘s page for details. Transit Notifications are also improved slightly but still only work for surface transit. Forget about using it on the subway. Despite the fancy redecoration Apple still refuses to label the Sea of Japan (since 2020). Unnecessary, dumb and insulting.

Weather App: still only shows temperature maps which I think are useless. Forget about precipitation which is the killer feature for any weather app worth using. Air Quality doesn’t apply to Japan as there is no national standard.

Last but not least, Apple Music and Apple TV are basically useless in iOS 15 b3, more 3rd party app are crashing too. Hopefully b4 will be stable.


Ossan’s Love in Hong Kong?
Just when I thought the Ossan’s Love franchise had run out of gas, it seems the Hong Kong version of the Japanese series is also a hit and making waves instead of giggles, although calling it “sugar-coated marijuana” is pretty funny. If the Hong Kong version is anything like the Japanese one, it is sugar-coated silliness. For my money the other Japanese hit gay themed series ‘What did you eat yesterday?‘ was not only a lot more engaging, funny, serious and thought provoking, it was also useful as a cooking show. Kinda like Shinya Shokudo (Midnight Diner) with better interior decorating and worth the time investment.

Have a good week and enjoy the Olympics.