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Apple Eyeing the Huge Corporate Card Market for Apple Pay Services

80. Special Report
Apple's new Apple Pay is making headlines everywhere and with a likely Apple-Alibaba alliance in the wings, it's only going to expand at an accelerated rate. Behind the scenes, Apple Pay had been in the works for many years. We covered most of Apple's patents over the years as this service was once dubbed the iWallet. Apple Pay is a service that will take years to unfold before it's found to be commonplace. Every mammoth project like this takes time. The first car didn't have major paved roads to travel on. So when I hear reviews laughingly state that Apple Pay didn't work at their local cleaners or a garage in the middle of nowhere, my eyes just roll. The same is true with Apple Pay working with Corporate Cards. Some think that Apple missed a huge market opportunity by ignoring it. Yet Apple is eyeing this market, they're just being quiet about it for now.


Even though Apple Pay only got off the ground on October twentieth, FIS Global reportedly stated that a major part of Apple Pay that is missing relates to corporate cards and that Apple is missing out on many opportunities by not allowing commercial cards to be used with Apple Pay, as referenced by in a recent report.



Their report further noted that according to the Global Business Travel Association, the 2014 corporate travel spending projection reached $242 billion. Commercial cards, also called purchasing or corporate cards, are issued to businesses as an alternative way to finance expenses for travel, rental cars, hotel rooms  as well as for supplies, entertainment, and other items or services that require a purchase order. 


Another report along the same lines was published three weeks earlier by CIO. When talking about corporate cards, Al Sacco — Senior Editor for CIO stated that it's "unfortunate for frequent travelers who were hoping to use their iPhones for payments while on the road. AmEx Corporate Cards are widely used by many business travelers."


Will Apple Address Corporate Cards?


When Apple Pay first launched on October 20th, the chart that they presented, as shown below, showed us a column for corporate cards that was basically left blank … for the time being.


Graphically speaking they could have just eliminated the column instead of looking like they failed to address this market. It appears to me that Apple purposely included this specific column in their list because they're likely to address this aspect of Apple Pay at a later date. It may even be a part of a future announcement between their enterprise partner IBM. It would be an excellent place for the Apple-IBM partnership to start. But for now, it's a sign that Apple is eyeing this market for a future point in time.



Yesterday we noted in a report covering announcements made by BlackBerry that "BlackBerry's proposed software tool that will allow companies to avoid paying costs incurred by employees using their devices for personal use. With the software, dubbed WorkLife, smartphone users will be able to have a separate personal and work phone number attached to one device, making it easier for employers to pay for work-related calls and messaging traffic while not assuming costs for personal use of a corporate device."


So while the report was focused just on "corporate cards," as if it was something that Apple missed, the fact is that for Apple to make Apple Pay work effectively in the enterprise, there are likely many features that have to be addressed and built into iOS before Apple is ready to introduce corporate cards as part of Apple Pay and that's where I think IBM's participation will come into play.


Right now Apple's CEO has stated that getting Apple Pay into China was a priority. Apple has a long way to go to get the consumer side of the market for Apple Pay in place before addressing the enterprise. However, with IBM as its corporate partner, this process may likely be expedited. So stay tuned on that front.


In the end, will Apple Pay ever work with Corporate Cards in the future? Of course they will, we just need to have a little patience. As the old saying goes – Rome wasn't built in a day. Building great things just takes time. At the beginning of Apple's World Wide Developer Conference back in 2013 they ran a marketing video. A major angle to that message was "Designing Something Original Takes Focus," and that great things take time. How true.


That's just something that the report, in my view, missed to acknowledge. The report took the position of the glass being half empty instead of it being half full. Apple in the end didn't miss an opportunity at all. They just introduced an amazing consumer product in the form of a mobile wallet and the enterprise end of Apple Pay will arrive when the time is right. That's a huge difference in perspective.  


Though on a closing note I think we can all appreciate Al Sacco's honest opinion when he said that "I know I'd love to be able to pay for my seemingly endless array of cab rides with my phone." Yes Al, many would agree with you on that one, especially Apple. I'm sure there'll be a solution to that over time. 


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