Tokyo Cashless 2020: Blame the Japan Cashless Payments mess on VISA and EMVCo, not FeliCa

1️⃣ Dear JR East, we need a new Suica Charge App
2️⃣ Consumption tax relief with the CASHLESS rebate program
3️⃣ Are Apple Maps and Siri really Apple Pay level ready for the Tokyo Olympics?
4️⃣ > Blame the Japan Cashless Payments mess on VISA and EMVCo, not FeliCa

Tokyo Cashless 2020 is a series covering all things cashless as Japan gears up for the big event. If there is a topic that you’d like covered tweet me @Kanjo


Japanese journalist Akio Iwata just published a piece explaining why VISA has not signed with Apple Pay in Japan. It is paywalled and I have not read it, but Japanese readers noticed similar points in my earlier piece Why Visa refuses to join Apple Pay Japan and tweeted about it. The subject is timely and worth visiting again after the events of the past year.

Some western business journalists and industry pundits look at the Japanese payments market and write about failure: the failure of FeliCa to be universally accepted, the failure of Japanese society to use cashless payments instead of hard cash. It’s a kind of cut and paste narrative construct journalism that you see too much of these days, like the recent Financial Times piece, or worse the NFC TIMES. The narrative is persuasive enough to blind some Japanese journalists as well.

This kind of reporting plays to the expectations of a certain readership, but it completely fails to capture or explain the massive changes happening in Japan right now, set in motion by the arrival of Apple Pay in late 2016. The bulk of the cut and paste argument is that FeliCa failed to take off in Japan and because Japan failed to switch to the EMV ‘world standard’, that’s why we have the current messy situation. End of story. I don’t buy this argument at all.

FeliCa was around long before the EMVCo consortium got it’s NFC act together in the early 2000s. NFC-A is Philips, NFC-B is Motorola, NFC-F is Sony. The ISO/IEC 14443 standard was supposed to include NFC-F but the ISO ultimately decided not to include it. EMVCo created the EMV contactless standard on ISO/IEC 14443 NFC A/B.

With lots of help from JR East, NFC-F was added to the ISO/IEC 10373-6 and GSMA/GCF (Global Certification Forum) TS. 26, TS. 27 specifications. From April 2017 GCF certification for all NFC mobile devices requires NFC-A, NFC-B and NFC-F support.

It is this later development, and especially the fruit of that development, Apple Pay Suica, that I believe is unacceptable to VISA and by extension EMVCo. VISA cooperates with Apple Pay in other countries because it promotes EMV, VISA refuses to cooperate with Apple Pay in Japan because it promotes FeliCa. Instead of promoting bank card use and new services VISA is promoting technology.

I have long suspected that VISA simply does not want anything to do with Apple’s support of the Global NFC standard put in place by the NFC Forum and GSMA/GCF in 2017. It’s not only Apple…VISA refuses to support dual mode (EMV/FeliCa) Docomo iD/NFC for Android Osaifu Keitai users abroad which Mastercard, American Express and JCB do. VISA simply wants to bide time until NFC Pay/EMV contactless support in Japan is everywhere and then simply ignore FeliCa (NFC-F) all together…

Unfortunately this strategy has only accomplished one thing: it provided an opening for QR Code payment system players…

Why Visa refuses to join Apple Pay Japan

My argument is simple. The VISA and EMVCo mindset is stuck in the one size fits all single mode plastic card era. This is easy to understand as the plastic card issuing business is a very lucrative one.

But like all things there is a downside: instead of embracing the full promise of global NFC digital wallets that can match the best NFC technology for the job with multiple mode cards that do everything and ‘just work’ everywhere, we have the contactless payment turf wars which are really just plastic era fighting moved to a digital arena.

Instead of pursuing the advantages of digital wallets that merge the best of native transit cards on the front end with the best of bank cards on the back end, where they perfectly complement each other, we have bank cards fighting to be everything, which they are not and will never be. This is why Apple markets Apple Card as ‘a new kind of credit card, created by Apple, not a bank.’ It’s the reason why Apple Card is Mastercard brand, not VISA.

In Japan specifically we have VISA refusing to join Apple Pay Japan and for the most part Google Pay, and VISA Japan key player Sumitomo Mitsui fighting on and off with Mobile FeliCa key player Docomo. And the result? None of this nonsense helped strengthen VISA Japan’s market position one bit. On the other hand VISA’s arrogance pulled all the other card companies down with it and provided a huge opening for the Japanese QR Code players like PayPay.

When I wrote Why Visa refuses to join Apple Pay Japan the frenzy of Japanese QR Code payments was just getting underway. Over a year later I think this conclusion is stronger than ever and the only one that explains the reality of the current market. VISA may like to think that the Tokyo Olympics is the last great opportunity to finally kill FeliCa. That’s not going to happen.

Only by setting aside the past and embracing the multimode digital future with forward looking cooperation, can VISA (and by extension EMVCo) help bring order to the payments chaos of the Japanese market. Only cooperation can deliver the promise of cashless payments to Japan, and strengthen the long term market opportunities for all players.

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October 8 Mobile Octopus Service Maintenance Points to Apple Pay Octopus Launch

The Apple Pay Octopus service launch date possibility is centered on a planned October 14 update of the Octopus Cards Limited (OCL) Schedule of Fees and Guid, which makes sense because service fees need to added or updated for Apple Pay.

System maintenance of all mobile related Octopus services took place October 8 3am~6am local Hong Kong time. It was a precise list of services that would need to be offline to add Apple Pay Octopus support. This followed a similar October 3 mobile system maintenance and suggests a ramp up on the backend system.

I hope this is not a false alarm. At the very least I think we could be close to having a launch announcement from OCL by October 14 with a launch shortly after. For comparison the Smart Octopus on Samsung Pay launch announcement was made on a Monday, service started 3 days later.

Given the current situation in Hong Kong however, nothing is certain. Things are not easy for many in Hong Kong right now, but I hope for the best and send my sincere wishes for the safety of all.

10/14 UPDATE: the updated Schedule of Fees and Guidelines has no references to Apple Pay Octopus, nor is there any announcement from OCL. However there is a new reference to ‘wearables’ in the Mobile Device section of the updated Conditions of Issue of Octopus which means Apple Watch. There is no wearable for Octopus at this point, Apple Watch is the only device that fits the reference.

10/16 UPDATE: with no reference to Apple Pay in the updated Schedule of Fees and Guidelines, and only a hint of Apple Watch in the updated Conditions of Issue of Octopus, nor any sign of a launch announcement from OCL, yet another miss.

Given the current difficult situation in Hong Kong and long rocky road of OCL delivering Octopus on Apple Pay, it’s time for me to get out of the Apple Pay Octopus prediction business. It will come when it comes: after the rumored October Apple Event, the iOS 13.2 release, whatever. Until then stay safe and happy transit wherever you may be.

Apple Pay Global NFC Lineup Updated with iPhone 11/Apple Watch 5

The Apple Pay Japan page has a special place in Apple’s web site galaxy. It is the only page that lists global NFC specs for Apple devices. This was the page where we learned about global FeliCa iPhone 8/iPhone X/Apple Watch 3 because Apple didn’t announce anything. So the Apple Pay Japan page check is a ritual and final word of global NFC support for every new Apple device.

There were no surprises after the latest new iPhone announcement. We all knew the Apple Pay Japan device spec list would be updated with iPhone 11/iPhone 11 Pro/Apple Watch Series 5 at some point, which it finally was this week. The ritual and peace of mind is always a good thing.

Just one last little question for Apple: when does the Hong Kong Apple Pay page finally join the Apple Pay Japan page for global NFC device specs now that iOS 13 Hong Kong Wallet mentions travel cards and Apple Pay Octopus is coming soon?

Suica App 2.5 Update

Suica App 2.5 dropped on 9/25 without a peep from JR East but this morning they released a notice urging Suica App users to update by 10/22. It’s not immediate clear what has changed, most likely it’s all backend stuff.

Gosh does this have anything to do with a Apple Pay system update or Octopus? And by the way, where are we on that one Sunny?

UPDATE: JR East has followed up with a Mobile Suica email notice labeled ‘urgent’ asking Suica App users to update to version 2.5 ASAP. This looks serious so update as soon as you can.

Tokyo Cashless 2020: Are Apple Maps and Siri really Apple Pay level ready for the Tokyo Olympics?

1️⃣ Dear JR East, we need a new Suica Charge App
2️⃣ Consumption tax relief with the CASHLESS rebate program
3️⃣ >Are Apple Maps and Siri really Apple Pay level ready for the Tokyo Olympics?
4️⃣ Blame the Japan Cashless Payments mess on VISA and EMVCo, not FeliCa

Tokyo Cashless 2020 is a series covering all things cashless as Japan gears up for the big event. If there is a topic that you’d like covered tweet me @Kanjo


iOS 13 is not a software release. It’s a mission statement of what Apple hopes to achieve by the end of the iOS 13 life cycle. iOS 13 will be peaking out just as the Tokyo Olympics take place between 24 July – 9 August 2020. There will be a huge influx of inbound smartphones using all kinds of apps for transit, navigation and payments. Apple has told Japanese journalists that Apple services will be ready. How will peak iOS 13 Apple Pay, Apple Maps and Siri stack up with the competition? How useful will they really be? Let’s find out, starting with the strongest contender.

Apple Pay
Apple has put a tremendous effort into creating a global NFC platform that incorporates all the key NFC technologies (EMV, FeliCa, MIFARE, etc.) into one seamless package sold worldwide. This is still unique and unmatched. Inbound visitors with iPhone have the option of adding Suica to Wallet and instantly gaining all the benefits of using Japan’s famous tap and go transit and making contactless payments nationwide.

Apple Pay with Suica makes iPhone a great transit and payment solution for the Tokyo Olympics and Apple Pay Suica will be the inbound star player for all things transit and payments. iPhone and Apple Watch are so perfectly matched for using contactless payments in Japan during the Olympics that I can only wonder if Apple has been planning for this opportunity all along. Make no mistake, Apple Pay is going for the gold.

In addition to Suica support, merchant support is growing for inbound Apple Pay cards as well

Apple Maps
Apple Maps Japan is one of those players with great unfulfilled potential that is never realized. Apple has vowed that Maps will be ready for the Tokyo Olympics. This means that Apple Maps 2.0 for Japan will be ready with new detailed maps, Look Around, and, one hopes, indoor maps that include stations, not just airports and shopping malls.

The biggest use case for Apple Maps during the Olympics is transit directions and local walking area navigation in station areas. Apple Maps is still a very ‘America centric’ app in that default map views and the UI are geared for driving, not transit and walking. iOS Google Maps has a more intelligent approach that layers transit over the current map view that eliminates the transit view/map view UI toggling of the chunky Apple Maps UI. Google Maps is a much more smoothly integrated collection of services.

Even with the addition of better map detail of Apple Maps 2.0 and Look Around however, Apple Maps must absolutely clean up and completely revamp its cluttered cartography and Point of Interest (POI) layers and remove the bolted on transit functions with improved integration to be a serious contender in the Tokyo Olympics Navigation contest. I don’t see that happening: there’s no way 7 years of bad habits and ‘Where’s Wally’ can be magically fixed in the 10 month run up to the Olympics.

Siri
Bringing up the rear, Siri is the ‘Cool Runnings’ contender in the wrong Olympics. With Google Maps you can ask Google Assistant “when’s the next train to Shinjuku” and Google Maps will give you a list of transit options. Google Maps Transit also gives you platform guidance, optimum car positions for the destination station, and ground truth yellow exit numbers:

Siri and Apple Maps offer none of this. In fact Siri is not even programmed at this point to provide transit information and politely declines all such requests (and when did Japanese Siri’s speaking rate speed become so SLOOOOOW?). Even a manual Apple Maps Transit search does not provide the same level of Google Transit information: no platform guidance, no car positions, no crowd conditions, etc. Meanwhile JR East just announced an agreement with Google to offer Google Assistant Shinkansen transit information. This isn’t even a contest.

Quick Summary and Tokyo Olympics iPhone Guidance
Given the current state of Apple Pay, Apple Maps and Siri, I offer the following suggestions.

  • For iPhone 8/Apple Watch Series 3 and later inbound visitors from countries with Apple Pay availability:
    • Add Suica to your iPhone and recharge it with your Apple Pay card from home
    • Use Google Maps and Google Assistant for navigation and transit
  • For iPhone 8/Apple Watch Series 3 and later inbound visitors from countries without Apple Pay availability:
    • Purchase a regular plastic Suica card from a JR East station kiosk and transfer it to your iPhone (Welcome Suica cards cannot be transferred), you cannot recharge it with a credit card but Apple Pay Suica can recharged with cash at any convenience store checkout register, any 7 Eleven ATM, or JR station smart kiosk. The advantage of Apple Pay Suica over plastic Suica is that you always know what the balance is and when it needs recharging. You can avoid long queues at station recharge kiosks.
    • Use Google Maps and Google Assistant for navigation and transit