Apple's iPhone may be the smartphone, and the latest iteration of it, the iPhone 5, which was unveiled Wednesday, looks set to sell like hotcakes, even if some are disappointed that Apple hasn't done more.

But while Apple may not have made any bold strides this week with the iPhone 5 itself, one new application in iOS 6, Passbook, could represent an important step for Apple as it looks to taking its dominance in the smartphone arena and extending it to other mobile opportunities, such as commerce and advertising.

As Adweek's Christopher Heine explains, Passbook could become more than a Google Wallet-like offering that simply allows consumers to make purchases and store digital tickets on their iPhones:

Theoretically, merchants can code Passbook offers and deliver them via email, Web or within their brand apps. These Passbook items (coupons, discounts, etc.) can be associated with up to 10 locations via latitude and longitude coordinates.

Those coordinates provide Passbook with the ability to offer reminders on a person's home screen, similar to push notifications, that an item in his or her Passbook is available for redemption (e.g., coupon) when the consumer nears those designated coordinates. Additionally, merchants can provide updates—through push notifications—to Passbook items without any user interaction required.

This, of course, will enable scenarios marketers "have theorized about for more than a decade." So it's no surprise that companies seem eager to jump on the Passbook bandwagon. Delta Airlines, Ticketmaster, and Starwood Hotels have joined the list of companies expected to be participants in Passbook's launch. Others believed to be on board include Starbucks, United Airlines and Amtrak.

Bad news for upstarts?

Adam Kmiec, who heads up digital and social for Campbell Soup, believes that Passbook will be "a win-win for marketers and consumers." One of the reasons: he believes Apple's new offering will force other players in related spaces, such as Groupon and Foursquare, to improve their offerings.

But will that really happen? While a lot of companies are trying to cash in on the mobile commerce and mobile couponing opportunities, it's not clear how much room there is for competition. If Apple is able to gain substantial traction with Passbook it could be bad news for upstarts given Apple's market penetration.

The good news for those hoping Apple is a less dominant force in mobile commerce and couponing: that might be a very big if. Apple's iAd was supposed to revolutionize mobile advertising, for instance, but it's safe to say that, if that was the goal, it hasn't met expectations. And despite Apple's ability to recruit big-name partners to Passbook, the iPhone 5 lacks a commerce feature many were hoping for: NFC.

Passbook, or NFC?

As iTWire's Stuart Corner argues, Apple's explanation for why it didn't include NFC technology in the iPhone 5 "rates a 'fail'" and notes that, unlike NFC, Passbook is a proprietary application exclusive to iOS 6. "With the number of Android phone shipments now exceeding those of the iPhone the lack of NFC support on the iPhone, and no indication of when it will be added, developers might be looking first to NFC," he suggests.

Time will tell whether that's correct, but one thing seems certain: companies looking for a clear path forward with mobile commerce and marketing shouldn't expect decisive victories any time soon, regardless of how many iPhone 5s Apple sells.

Patricio Robles

Published 14 September, 2012 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

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Comments (3)

Jeremy Spiller

Jeremy Spiller, MD at Econsultancy Guest Access TRAININGSmall Business Multi-user

This will be huge. It may not be perfect yet, but the new Apple Inc as we know it gets this sort of thing right. It's really just a matter of time. Of course the other large players such as Microsoft, Google, and Amazon will be launching, competing and developing their own similar payment technologies but this is going to be a game changer in online commerce.
@David as you say, it's going to join things up. @Patricio, as ever, great article.

almost 6 years ago


Randy Smith

Apple's Passbook should become a Mobile Wallet soon. It seems like they are heading down the right road.

Bar codes can be used with Passbook to work like LevelUp or Starbucks Card Mobile, to create Mobile Wallet. Therefore NFC is not needed for them to get started in mcommerce. Even though very few merchants have optical readers capable of reading QR codes, many have 1D readers or would be much more willing to buy QR or 2D readers should Apple move forward when Apple moves to make Passbook a Mobile Wallet.

Visit my site to learn more about news and opinion on the future of mcommerce.

almost 6 years ago

Rob Smith

Rob Smith, Managing Director at Blueleaf

To the point of NFC - Apple users still have a massive majority share of mobile browsing statistics that we look at, and as such, the greatest share of mobile spend. The presence of NFC in Android needs to be attached with the consumers that have these devices spending using them is NFC is to make any difference.

almost 6 years ago

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