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It was only a matter of time until tech giant Apple (Nasdaq: AAPL ) offered its own version of the digital wallet, and the introduction at the Worldwide Developer Conference earlier this month of the new Passbook app seemed to have most of the ingredients -- except a way to pay for purchases.
That's an important exception, but Passbook, which is touted as a way to store all your passes, tickets, and store loyalty cards together in one place, is obviously the opening salvo in Apple's move into the digital wallet space. If it has a barcode, it can be stored in Passbook. A big plus is that each item is constantly being updated, so that you will be able to see at a glance your current status on your Target loyalty card, for example, as soon as you walk in the store. Likewise, a change in flight status would be immediately available to you when you arrive at the airport, since the app uses the iPhone's geolocation chip to determine where you are, and what you might need now that you are there.
Could be a contender
The lack of a payment function will keep it from being a real threat to other digital wallets, like eBay's (Nasdaq: EBAY ) PayPal, the reigning king of e-commerce. The interactivity of the app with the user is similar to PayPal's new digital wallet, which allows users to customize wish lists, and is something that consumers really hanker for.
Google Wallet will likewise not be affected, and the Big G is rumored to be working on a new Wallet 2.0, hoping that the improved version will be more popular than the original. Sprint (Nasdaq: S ) , the only carrier that sports Google Wallet, is supposedly working on its own system, which will certainly put a crimp in Google's plans.
The other big digital wallet player is Isis, whose platform is getting pretty crowded lately as more payment companies sign up alongside T-Mobile, AT&T (NYSE: T ) , and Verizon Wireless (NYSE: VZ ) . Last year, Isis morphed into a full-blown mobile wallet entity as it partnered with major card issuers and the three communication giants poured another $100 million into its development.
Do Passbook's limitations mean that the other players can rest easy? Not a chance. Apple doesn't do anything half-heartedly, and this is just the beginning of its presence in the digital wallet arena. My guess is that, since this app is being loaded into the iOS 6, which debuts this fall, this is a trial run. Apple will see how it is received, and quickly add a payment option. When that happens, Passbook will be a true threat to other systems, namely PayPal. The latter is no slouch, either, and the sparks should fly as these two titans duke it out. As always, though, I'd put my money on Apple, which I suspect will soon force PayPal to share its crown.
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