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Mobile payments grow up

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The announcement of Samsung Pay, in direct competition with Apple Pay, is a signal that payments with mobile devices are growing up, writes ARTHUR GOLDSTUCK.

Once a year, Barcelona plays host to an event that signals the key shifts in mobile technology, setting the agenda for personal gadgets for the rest of the year. Mobile World Congress 2015, which took over the city for most of last week, pushed the boundaries just a little further than usual.

The most significant announcement of the week was not a device, however, but a new way of doing something as old as civilisation: making payments.

When Samsung unveiled its new Galaxy S6 and S6 Edge, it also declared the next phase in its war with Apple. Back in September, Apple had announced the iPhone 6 and 6 Plus, along with a payment system called Apple Pay. The similarity in names is no coincidence. Samsung wants to make it clear that, not only is it playing in the same space as Apple, but it is doing it better.

Apple Pay works through NFC, or near-field communication, which allows the sending of data from one device to another with a single tap. That data can include files, photos and payment or transactional information, if it has been set up in advance. As a result, a single tap, authenticated via the fingerprint sensor on the iPhone 6, can conclude a transaction at an NFC terminal in a retail outlet.

Samsung Pay goes a step further. While it also offers fingerprint verification and NFC, which is still in limited use in the retail world, it ups the ante with MST, which caters for the vast majority of retailers who still use magnetic stripe card readers.

MST, for magnetic secure transmission, allows a device to be placed alongside a card terminal and send a radio signal that mimics the interaction of the magnetic stripe on a card with the terminal. It instantly allows Samsung Pay to be compatible with any retailer in the world that accepts credit, debit or payment cards.

Samsung’s leapfrog over Apple was made possible by its acquisition, earlier this year, of a company called LoopPay, which describes itself as “the world’s first mobile wallet solution that allows consumers to pay with their mobile devices at most places and leave their wallets at home”.

The LoopPay solution, as it existed prior to last week’s announcement, consisted of a LoopPay App and a LoopPay device, which worked in tandem.

“The App manages and securely stores all payment cards including credit, debit, loyalty, and gift cards on the device,” LoopPay explained. “Currently, we offer the LoopPay Card, CardCase, and a stand-alone Case for iPhone 5/5s, 6, and 6 Plus.”

The company’s explanation of how LoopPay works provided no inkling of the scope of Samsung Pay, as it implied any manufacturer could use it. Samsung turned the market on its head with one simple innovation: it built the LoopPay technology into the Galaxy S6 and S6 Edge, instead of providing an accessory device.

The result is that the phone merely needs the app to be activated for it to run Samsung Pay. It also means that the accessory case for iPhones is almost instantly obsolete.

The service is initially being launched in Samsung’s home territory, South Korea, and in the United States – a direct challenge to Apple. There is no timeframe on its roll-out elsewhere, which suggests Samsung is initially more focused on taking on Apple than on serving consumers.

That is also, most likely, the reason for the cut-and-paste branding of the payment service. It may be the snappiest possible title, but calling it Samsung Pay is also the most sincerest possible form of flattering Apple. If the wheels come off this particular bandwagon, it will be more than a financial disaster for Samsung.

Later this year, American retailers will be required to implement EMV (Europay MasterCard Visa) “chip-and-pin” terminals, which may well have to include NFC technology. That opens the rest of the US market to Apple, but still leaves Samsung with a global edge.

In the meantime, other challengers are likely to emerge. Rumours have already surfaced that LG Electronics will build payment technology into the next version of its flagship phone, to be called the LG G4. Numerous mobile payment applications will also have to change their game or find a way to integrate or add to the two Pay systems.

Google Wallet, which was once expected to dominate mobile payments, is fast fading into the background. Its near-demise is a timely lesson to the Pay masters of the mobile world that market domination in one arena does not automatically lead to market success in another.

* Arthur Goldstuck is founder of World Wide Worx and editor-in-chief of Gadget.co.za. Follow him on Twitter on @art2gee, and subscribe to his YouTube channel at http://bit.ly/GGadgets

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LoopPay on how MST works:

“MST technology generates changing magnetic fields over a very short period of time. This is accomplished by putting alternating current through an inductive loop, which can then be received by the magnetic read head of the credit card reader. The signal received from the device emulates the same magnetic field change as a mag stripe card when swiped across the same read head. LoopPay works within a 3-inch distance from the read head. The field dissipates rapidly beyond that point, and only exists during a transmission initiated by the user.”

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Password managers don’t protect you from hackers

Using a password manager to protect yourself online? Research reveals serious weaknesses…

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Top password manager products have fundamental flaws that expose the data they are designed to protect, rendering them no more secure than saving passwords in a text file, according to a new study by researchers at Independent Security Evaluators (ISE).

“100 percent of the products that ISE analyzed failed to provide the security to safeguard a user’s passwords as advertised,” says ISE CEO Stephen Bono. “Although password managers provide some utility for storing login/passwords and limit password reuse, these applications are a vulnerable target for the mass collection of this data through malicious hacking campaigns.”

In the new report titled “Under the Hood of Secrets Management,” ISE researchers revealed serious weaknesses with top password managers: 1Password, Dashlane, KeePass and LastPass.  ISE examined the underlying functionality of these products on Windows 10 to understand how users’ secrets are stored even when the password manager is locked. More than 60 million individuals 93,000 businesses worldwide rely on password managers. Click here for a copy of the report.

Password managers are marketed as a solution to eliminate the security risks of storing passwords or secrets for applications and browsers in plain text documents. Having previously examined these and other password managers, ISE researchers expected an improved level of security standards preventing malicious credential extraction. Instead ISE found just the opposite. 

Click here to read the findings from the report.

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MWC: Next generation of inflight connectivity to be unveiled

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Next week at Mobile World Congress, the Seamless Air Alliance will reveal progress on its mission towards enabling the next generation of inflight connectivity. This follows a significant start for the Alliance, which has seen membership increase five-fold since the first meeting in June of last year. The Alliance has a new research laboratory setup and continues progress through its three working groups, writing specifications for the technology, requirements, and operations.

These developments represent a huge leap towards the goal of making connectivity as easy and enjoyable in the skies as it is on the ground. Appearing as part of the Airbus stand (Hall 6, stand 6G34), the Seamless Air Alliance will reveal specification topics that have been completed and published to its membership.

“The passenger experience with inflight connectivity remains one of the great technology challenges. From Day One we have been determined to deliver on our mission to bring industries and technologies together to make the inflight internet experience simple to access and a delight to use,” said the Alliance’s Chief Executive Officer, Jack Mandala.

“I have been tremendously encouraged by the enthusiastic and committed response we have seen and the widening areas of expertise we can call upon as more and more companies and organisations continue to join us,” he added.

Announced during MWC 2018, the Seamless Air Alliance has since grown to twenty-three membercompanies with more than one-hundred key personnel from across the membership participating in its three working groups, with numbers continuing to increase.

The Seamless Air Alliance was created by founding members Airbus, Airtel, Delta Air Lines, OneWeb and Sprint, and quickly joined by Air France KLM, Aeromexico, and GOL Linhas Aereas Inteligentes and global technology leaders including Astronics, Collins Aerospace, Comtech, Cyient, iDirect, Inmarsat, Intelsat, Latecoere, Nokia, and Panasonic. 

Today, the Alliance is pleased to announce five additional new members: Adaptive Channel, Etihad Airways, GlobalReach Technology, Safran, and SITAONAIR.

“We are extremely pleased to have these companies join and be a part of the companies driving the next generation of connectivity.” said Mr Mandala.

The Seamless Air Alliance will enable travelers boarding any flight, on any airline, anywhere in the world, to use their own devices to automatically connect to the Internet with no complicated login process nor paywall to scramble over.

The Alliance is also announcing the release of a new research study on the economic benefit of standardization on the inflight connectivity market at Mobile World Congress. This report is available for download at https://www.seamlessalliance.com/publications/

The Alliance is moving rapidly towards an expected demonstration of the technology later in 2019 and anticipates massive interest in Barcelona from the whole communications eco-system.

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