2014年9月13日星期六

An illustrated history of the iPod and its massive impact [feedly]



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An illustrated history of the iPod and its massive impact
// Cult of Mac

Editor's note: The iPod has enjoyed a good long run as one of the world's most revolutionary music machines, but the time has come to bid adieu to the click-wheeled wonder.

Apple quietly removed the iPod Classic from its website this week, so now is the perfect time to wax nostalgic. Cult of Mac is republishing this illustrated history of the iPod — put together to celebrate the device's 10th anniversary, and originally published on Oct. 22, 2011 — to mark this solemn occasion.

An Illustrated History of the iPod

The iPod grew out of Steve Jobs' digital hub strategy. Life was going digital. People were plugging all kinds of devices into their computers: digital cameras, camcorders, MP3 players. The computer was the central device, the "digital hub," that could be used to edit photos and movies or manage a large music library. Jobs tasked Apple's programmers with making software for editing photos, movies and managing digital music. While they were doing this, they discovered that all the early MP3 players were horrible. Jobs asked his top hardware guy, Jon Rubinstein, to see if Apple could do better.

Rubinstein spent a few weeks on the project but concluded the technology wasn't yet there. Either it would be big and bulky, or the battery would suck, or it would have limited memory. He was just about to give up when he made a routine visit to Toshiba, one of Apple's hard drive suppliers. At the end of a meeting, the Toshiba executives offhandly showed him a new, 1.8-inch hard drive they had just prototyped. They didn't know what to do with it. Rubinstein immediately recognized it as the key technology for the first iPod.

Rubinstein recruited engineer Tony Fadell to oversee the hardware. In less than nine months, Fadell's team had a product ready to go. Apple's marketing guru Phil Schiller suggested the scroll wheel because it was clear early on that users will have to navigate huge lists of songs. To speed things up, the iPod was assembled from off the shelf parts — a Toshiba hard drive, a Sony battery and chips from Texas Instruments.

The name "iPod" came from a freelance copywriter, Vinnie Chieco, who as soon as he saw the pure white device thought of Stanley Kubrik's 2001 and the immortal line: "Open the Pod Bay doors, Hal." Steve Jobs was talking a lot about the iMac and iLife, so adding the "i" prefix was a natural thing to do. Jobs initially rejected the iPod name, but later came around to it.

iPod cutaway by Silvan Linn

2000

January 9: Apple releases its iTunes music jukebox software, which was based on a program called SoundJam MP, purchased by Apple in early 2000. Some critics complain that it doesn't have a boatload of advanced features, but it is nice, simple and makes digital music easy.

October 23: Only a month after 9/11, and in the midst of an anthrax terrorist scare, Jobs took the stage at Apple's HQ to announce the first iPod. From the get-go, he has large ambitions for the device. He calls it a "breakthrough digital device."

"Music is a part of everyone's life," he said, "and because it's a part of everyone's life, it's a very large target market all around the world. It knows no boundaries."

The small white player has a 1,000 song capacity thanks to its 5GB hard drive, but costs $399.

Watch Jobs unveil the iPod:

The initial reaction from the public is not good. Most critics think it's too expensive and does too little. "All that hype for an MP3 player? Break-thru digital device?" said one commentor on MacRumors forums. "The Reality Distiortion Field™ is starting to warp Steve's mind if he thinks for one second that this thing is gonna take off."

Others riff on the name iPod: "Idiots Price Our Devices"; "I prefer Owning Disks"; "I Prefer Other Devices."

2002

July 17: The second-generation iPod is released in 10- and 20GB capacities. Similar in appearance to the previous generation, this version featured a touch-sensitive wheel instead of the prior mechanical one. It also had a redesigned hold switch and a cover on the FireWire port. The iPod was now Windows-compatible as well, thanks to Musicmatch software.

September: In France, the iPod was briefly taken off the market when authorities said it was too loud and could damage listeners' ears. Under French law, portable devices were limited to 100 decibels. The iPod's software was quickly updated to reduce the volume. Users in other European countries are not happy.

October: With the release of iTunes 4.1 comes compatibility with Windows 2000 and XP; iPod sales explode following this development. Jobs gets his friends in the music business, including U2′s Bono and Mick Jagger, to help launch the software. Apple takes out cheeky ads that say "Hell Froze Over."

December: Apple offers limited-edition iPods with signatures of Madonna, Tony Hawk, Beck, or No Doubt laser-engraved on the back. These are the most expensive iPods Apple has sold: the top-of-the-line model cost $548.

Number of iPods sold through 2002: 600,000

2003

April 28: Apple releases the third-generation iPod, which moves the control buttons to a new row of touch-sensitive buttons under the screen. This model introduces the USB dock connector for syncing. Apple also introduces iTunes Music Store, which opens with 200,000 songs available for 99 cents each. At a time when music piracy is rampant, the move is seen as ballsy. Who would pay for music when it is available for free? But Jobs argued that simplicity and ease of use would trump stealing. Most consumers wanted to do the right thing, he said.

The 3G iPod marks the most important change in the iPod's early history: Apple adds USB alongside FireWire. This makes the iPod compatible with vast numbers of Windows PCs, and sales start to explode.

May: Oprah names the iPod one of her "Favorite Things" and gives everyone in her show's 350-member live audience a 15GB iPod worth $399.

June: One millionth iPod sold.

Summer: The iconic silhouette ads become ubiquitous. The white earbuds turned out to be a marketing masterstroke: They advertised a player that was hidden away in a bag or pocket. They were just a lucky accident. Apple's head designer, Jony Ive, said the headphones are white because the iPod was white. But Apple soon realized its good fortune, emphasizing the white earbuds in its iconic silhouette ads.

September: iTunes downloads top 10 million songs.

September: Apple Corps, which holds the rights to The Beatles' catalog, sues Apple for violating a trademark agreement. Apple Computer had agreed to stay out of the music business, but with 10 million songs sold in iTunes, it was becoming unambiguously involved. When the case came before the High Court in London, the judge considered disqualifying himself because he used an iPod. Apple's lawyers argued that not even "a moron in a hurry" would mistake the two companies. The case was settled in 2007 — in favor of the computer company.

October: Apple makes the iTunes Music Store available to Windows users.

October: Dell launches its Digital Jukebox (DJ), which is heralded as the "iPod killer" because of its lower price point.

November: The anti-iPod backlash reaches a crescendo with "iPod's Dirty Little Secret," a video by the Neistat brothers complaining about the iPod's battery. The video goes viral and Apple starts a cheap battery replacement program.

Watch "iPod's Dirty Little Secret."

December: iTunes song downloads top 25 million.

December: Canadian authorities dragged the iPod into controversy about music piracy when it levied a CDN$25 charge on every iPod to compensate artists whose music was being ripped off.

Number of iPods sold through 2003: 2 million

2004

January 6: Apple goes small with the "iPod mini." The mini is released with 4GB of storage and in 5 colors. It features a new "click wheel" which combines the control buttons integrated into a solid-state, touch-sensitive scroll wheel.

February 1: Apple and Pepsi launch the biggest iTunes promotion yet. Publicized with splashy Super Bowl commercials, the two companies promise to give away 100 million free songs through iTunes.

February: Random shuffle inspires laudatory essays in cultural organs like The New Yorker, Wired and The Guardian. Professor Michael Bull says Shuffle is the signature feature of digital music, turning the iPod into an "Alladin's Cave of aural surprises."

March: After a string of muggings and robberies, the West Midlands Police, one of the largest police forces in the U.K., warned iPod users to stop using white earbuds.

June: BMW debuts the first car entertainment system with built-in iPod integration. Within a couple of hers, 90% of new cars would also offer this feature.

June: In a big cover story, Newsweek declares that America is "iPod Nation."

July: iTunes downloads top 100 million songs. The person who purchased the 100 millionth song, Kevin Britten of Hays, Kansas, gets a congratulatory phone call from Steve Jobs.

July 19: The fourth-generation iPod is released, with the new click wheel controls from the iPod mini. Available in 20GB and 40GB capacities.

Fall: Duke University provides iPods to all incoming freshmen.

August: The classic first-person-shooter Doom, which geeks have tweaked to run on almost every computing device known to man, is finally ported to iPod. It's a sign the iPod had finally gained nerd cred.

Doom runs on iPod. Photo: FHKE/Flickr

Doom runs on iPod. Photo: FHKE/Flickr CC

October: Microsoft CEO Steve Ballmer calls iPod users music thieves because "the most common format of music on an iPod is 'stolen'." He soon apologizes.

October 26: Apple introduces "iPod Photo" as its premium iPod featuring a color screen and updated UI for viewing pictures. Apple also releases the "iPod U2 Special Edition," a 30GB fourth-generation model with an all-black enclosure and red click wheel. On the back, the signatures of U2′s members are laser engraved and several exclusive U2 videos are included on the iPod's hard drive.

December: Playboy launches iBod, a set of saucy pictures optimized for the iPod photo. The galleries of PlayMates, Blondes and Voluptuous Vixens are dubbed the first 'iPod porn.'

Number of iPods sold through 2004: 10 million

2005

January 11: Apple announces a new entry-level iPod, the iPod shuffle, using flash memory with 512MB and 1GB capacities. Plugs directly into computer through onboard USB.

February 22: The second-generation iPod mini is released with updated colors and a longer battery life.

September: Apple rolls out a bunch of new iPod games through the iTunes Store.

September 7: Steve Jobs shocks the gadget word when he kills off the very successful iPod mini in favor of the iPod nano. The nano includes a color screen for photo viewing and is available in black or white, with 2GB and 4GB capacities. Later, a cheaper 1GB version is added to the line. Initially, Jobs' move was judged as reckless and crazy. Later, it was seen as pure Apple: Jobs was his own fiercest competitor.

October 12: The fifth-generation iPod is released, featuring another complete redesign. The new look brings a slimmer profile and larger screen for playing videos. Made available in black and white.

December: The White House reveals that even President George Bush has an iPod. Here he is discussing his playlist:

Number of iPods sold through 2005: 42 million

2006

February: iTunes sells its one billionth song.

Summer: iPod-inspired cakes reach a tipping point on the Web.

iPod cakes are all the rage. Photo: Paul Gault/Flickr CC

iPod cakes are all the rage. Photo: Paul Gault/Flickr CC

Fall: Everyone and their kids dresses as an iPod for Halloween.

Dressing up as an iPod becomes a Halloween sensation. Photo: Maria Ly/Flickr CC

Dressing up as an iPod becomes a Halloween sensation. Photo: Maria Ly/Flickr CC

September 12: The second-generation iPod nano is unveiled, featuring an anodized aluminum casing available in six colors, a design that hearkened back to the iPod mini. Alongside the new nano comes the second-generation iPod shuffle, which also gets a new anodized aluminum body, as well as a clip on the back.

The second-generation iPod nano came in multiple colors.

The second-generation iPod nano came in multiple colors.

Number of iPods sold through 2006: 88 million

2007

January 9: Steve Jobs delivers the keynote address at the Macworld Conference and announces three new products: "a widescreen iPod with touch controls," a "revolutionary mobile phone" and "a breakthrough Internet communicator." To uproarious applause, he reveals that these three products are actually a single device: the long-awaited and oft-rumored iPhone. Though it won't be released until June, Jobs demonstrates among many other features the built-in iPod media player application, featuring touch-controlled CoverFlow.

Watch Jobs' greatest performance, the introduction of the iPhone.

January: Spoof iPod ad featuring Microsoft CEO Steve Ballmer doing the "Monkey Boy" dance becomes smash viral hit:

April: 100 millionth iPod sold.

June 29: Apple releases the iPhone to long lines of eager shoppers in 4GB and 8GB sizes. After two months, Apple discontinues the 4GB model and drops the price of the 8GB model significantly, upsetting early adopters.

September 5: With the sixth generation of the original iPod comes a new name: "iPod classic." Apple updates the UI again and adds an anodized aluminum front. Available in black or silver in 80GB or 160GB sizes. A year later Apple discontinues both capacities for a single 120GB model. Apple also unveils the third-generation iPod nano, which features a 2-inch, video-ready screen in a nearly square enclosure, and a smaller click wheel. Most importantly, Apple begins the process of making the classic iPod obsolete by introducing a new touch-screen iPod, the iPod touch. It brings the multi-touch, web access, and media player features of the iPhone without the monthly cellular bill. Initially offered in 8GB and 16GB, with 32GB added to the line in February of 2008.

Number of iPods sold through 2007: 141 million

2008

February 5: Apple adds a 16GB model to the iPhone line.

March: The iPod goes to space on the Space Shuttle Endeavor.

April: iTunes passes Walmart to become the top music vendor in the United States.

July 11: Apple releases the iPhone 3G, a new model with a curved plastic back and 3G cellular data capabilities. Available in 8GB and 16G storage capacities.

September 9: Apple releases the fourth-generation iPod nano, reverting back to the original tall form factor and all-aluminum case. An included accelerometer allows for horizontal use. Apple also updates the iPod touch, bringing a curved chrome back, hardware volume controls, and a built-in speaker.

September: iPod connectivity is offered in more than 90% of new cars sold in the U.S.

Number of iPods sold through 2008: 197 million

2009

February: Jobs writes an open letter on Apple.com, Thoughts on Music, announcing that all songs in iTunes are DRM-free. It's a watershed moment for the digital music industry. Instead of fighting customers with restrictive file-protection schemes, Jobs made things easier for the consumer over the rights holders. It's also an acknowledgment that Jobs' iTunes strategy had worked: simplicity and ease of use could compete with piracy.

March 11: The third-generation iPod shuffle is announced, featuring a tiny form factor and no hardware controls at all; all controls have been moved to buttons on the headphone cable. Introduced VoiceOver technology allows the iPod to speak the name of playlists, artists, or tracks that the user selects.

April 1: On a state visit to the U.K, President Barack Obama gives the Queen of England an iPod.

April 27: All songs in the iTunes store become DRM-free as Apple adopts new pricing tiers at 79 and 99 cents and $1.29.

June 19: Apple releases an updated iPhone model, the iPhone 3GS. Nearly identical to its predecessor in appearance, it features upgraded internal components. The "S" stands for "speed."

September: Apple replaces the 120GB iPod classic with the 160GB model.

September 9: With the fifth-generation iPod nano, Apple gives the model a polished outer case and onboard video camera — the first in an iPod. This model also receives a speaker, FM tuner and larger screen, and is offered in 8GB or 16GB sizes. Also announced is the third version of the iPod touch, which brings the iPhone 3GS's upgraded processor and VoiceOver support.

Number of iPods sold through 2009: 250 million

2010

June 21: Apple releases the iPhone 4, featuring a flat, minimalist design and a metal band around the outer edge to serve as antennae. Even before Apple announces it, the iPhone 4 is steeped in controversy after an Apple engineer leaves a prototype test model in a bar and it makes its way to the hands of the tech blog Gizmodo. After the release, users discover that holding the iPhone 4 in "the wrong way" can greatly diminish the cellular signal.

September 1: Multi-touch comes to the iPod nano with the sixth-generation model. In addition, Apple also brings the clip from the iPod shuffle but removes video, speakers, and camera features. A fourth iteration of the iPod shuffle is also released, keeping the previous generation's VoiceOver feature but bringing the media controls down from the headphones and back to the outside of the unit itself.

September: President Obama discusses his 2,000-song iPod playlist with Rolling Stone: Jay-Z dominates but there is also Nas and Lil Wayne. He says, "Music is still a great source of joy and occasional solace in the midst of what can be some difficult days."

September 9: Apple unveils the fourth-generation iPod touch, with an even thinner design and two cameras. One camera on the back captures HD video, while the second camera on the front brings FaceTime video-calling capabilities. Apple also packs in their A4 processor and the Retina Display.

November: After years of rumors, speculation and hope, The Beatles catalog finally comes to iTunes. Still no sign of Led Zeppelin or the Rolling Stones.

Number of iPods sold through September 1, 2010: 275 million

2011

October 4: Apple unveils an updated iPhone model dubbed the iPhone 4S, which features a faster processor and an innovative AI called Siri. The iPod touch also sees a minor upgrade.

These days, the iPod is everywhere. Below, a female warrior of Southern Ethiopia's Mursi tribe holds her AK-47 and iPod.

Photo courtesy iLounge


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2014年9月12日星期五

Ask: How to Remove Unwanted Apps [feedly]



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Ask: How to Remove Unwanted Apps
// MacLife

Got an Apple, Mac, or iOS tech question? We have the answer. In this week's installment of Ask, we'll help you remove old, unwanted, or useless applications from your Mac.

Question

I have just upgraded my Mac to Mavericks using Migration Assistant. This is probably the fifth computer I have done this with, over many, many years, and many of my old apps have been rendered useless by switching to new operating systems. Is there a good method or a reliable app that will find and identify all of the useless files on my machine so I can remove them? 

Answer

Uninstalling apps on the Mac is fairly straightforward compared to other operating systems, but there are some caveats that you should know before starting the process. Applications created for the Mac have a ".app" extension to denote that they are an application. This ".app" is what's known as an application bundle; it's essentially a folder that contains all of the files related to the application that it needs to run. To remove these application bundles using the Finder:

1. Stop the application from running, and if it has options to run at Login,  disable these features. 

2. Remove the application and any helpers from the Dock and Menu bar by quitting them and dragging them off the Dock.

3. Locate the .app bundle in the Applications folder, or wherever you've been storing the app. 

4. Drag the .app bundle to the Trash, and empty the Trash.

This is all well and good, but there could still be files lying around your system relating to the application that you just removed. It is a common Mac app practice that user preferences, and other files relating to the application, will be stored in various system folders across your Mac for safekeeping. Follow these steps to find and remove additional files: 

1. In Finder, search for the application you just deleted. (Ideally it will be  something unique like "Firefox" or "Skype" rather than "Notes.") 

2. You can narrow the search to specific folders, if you know where it might be, or to the entire computer. 

3. Search using "File Name" instead of "Contents" to get better results (because we're looking for files relating to the app, which usually have the name of the app in the filename). 

4. Click the + button to add a new search criterion, then select Other > System Files; click "Don't Include" and select "Include" instead.

5. Sort by name, kind, date, and so on to identify components of the app; these might be folders, ".plist" files, cache files or other types.

6. Delete all of the files and folders relating to the app, but be careful to not delete files that could be used by other apps that you still wish to use. 

7. Once you've determined that everything is still working properly, then you can remove the files in the Trash. You may need to reboot your Mac before emptying the Trash, and/or use Secure Empty Trash from the Finder menu. 


Search for files relating to a specific application to help with removing them.

Again, we stress that you should be careful when removing these items. If you accidentally delete the wrong item relating to another application, the other app may not work properly. If you are not comfortable with this process, then you can use an automated uninstaller application such as AppTrap (www.onnati.net/apptrap), AppCleaner (www.freemacsoft.net/appcleaner), and AppZapper (www.appzapper.com). Don't expect these tools to remove all files associated with all applications, but they can do a pretty good job.

Ask is written by Cory Bohon, a freelance technology writer, indie Mac and iOS developer, and amateur photographer.

Got a tech question? Email ask@maclife.com.


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Apple earns 0.15% commission on every Apple Pay transaction [feedly]



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Apple earns 0.15% commission on every Apple Pay transaction
// iPhone Hacks

It was reported prior to the launch of Apple Pay, the one-touch mobile payment system for iPhone and Apple Watch, that Apple would receive a portion of the fees collected by major financial institutions on every transaction. According to a new Financial Times report this afternoon, it's true: a claimed 15 cents on every $100 purchase goes to the iPhone maker, according to two sources that are familiar with the private agreement.  Continue reading
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Opinion: Apple Watch Still Has Something to Prove [feedly]



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Opinion: Apple Watch Still Has Something to Prove
// MacLife

The following editorial will appear in the upcoming December 2014 issue of Mac|Life magazine. For more on Apple Watch and iPhone 6, look for special issues coming soon to the Mac|Life Newsstand app. Our Ultimate Guide to Apple Watch can be found here.

It was a long time coming, but Apple finally showed us the iWatch — I mean, Apple Watch. (Sorry, that's going to take some getting used to.) The September 9th unveiling not only marked the company's entry into a new market, but it was also the first time in the post-Jobs era that Apple stuck its neck out and took a risk. For Apple fans like us who get giddy over this stuff, the event — which also introduced the iPhone 6 and iPhone 6 Plus — had it all: slick promo videos, poetic corporate philosophy, live demos by the usual gang, and an introduction to the Apple Watch by the smooth-talking Jony Ive. Tim Cook even used Jobs's classic "one more thing" line, which got the biggest cheer of the day from the assembled press. There's no telling what Steve would have thought of the event or the products on display — I'm sure he would've had his own strong opinions, as he always did — but I believe the current crew at Apple honored his legacy.

But back to the Apple Watch: I dig the design, I really like the look of the UI, and it was introduced in about the best way possible…but I'm still not entirely sold. I want to be, because I've been waiting for Apple to make smart watches more interesting while Samsung and everyone else has struggled. I can't wait to wear one for a week to play with — to sift through the M&M app icons on the Home screen, sketch silly messages, and share my heartbeat with somebody — but when tech lust isn't taking me over, I don't know if there's a single defining function that justifies spending at least $400 after tax, or is worth wearing a watch again after I've ditched them for the last decade. There is no game-changing epiphany here like, say, the first iPod with its clear promise of "a thousand songs in your pocket."

Well, that's not entirely true: the health features do stand out a bit. The Activity and Workout apps look simple and fun to use, in ways that might make even a lazy sloth like me stick with a program. This appears to be the one area in which Apple Watch clearly surpasses the capabilities of iOS devices, and it provides a decent justification for dropping a lot of dough. I could probably talk myself into believing I'll start living healthier if that's what my conscience needs to splurge on one of these watches.

My guess is that Apple Watch will do great out of the gate thanks to diehard Apple fans and outside observers who want in on the next big craze. Beyond that, though? The device can never be more successful than the iPhone since every Apple Watch needs one to work. (The chances of it eclipsing Apple's flagship product were slim anyway, but still.) I don't think it will match the iPad, either. My somewhat pessimistic prediction is that Apple Watch will reach the level of Apple TV, a steady B-tier product with a loyal following.

Having said that, I very well may buy one. I'll want an Apple Watch just to ensure that I know what the hell I'm talking about here at Mac|Life, but I'd likely get one anyway because it's just too damn cool. That's the real killer app of any Apple product: they are so well crafted that you can't help but appreciate them.


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Gold Apple Watch Could Cost as Much as $1,200, Jeweler Says [feedly]



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Gold Apple Watch Could Cost as Much as $1,200, Jeweler Says
// MacLife

Apple stated at its Apple Watch reveal earlier this week that the device would start out at $349, but unsurprisingly, it's going to cost you a lot more than that if you want the high-end 18-karat gold "Edition" version. TechCrunch consulted Chad Rickicki, a Pittsburgh jeweler, and he produced an estimate on what you can expect to pay for the premium model, based on the watch's presumed size and weight.

Rickicki believes the device itself should cost Apple around $600, and he speculates that Apple may double that figure for retail. When it hits the shelves, then, the final product could end up costing around $1,200.

That's a big leap up from the somewhat agreeable pricing of the sport models, and the reasoning is simple — gold is expensive. Complicating the matter further, we still don't have any exact dimensions for the device; estimates like those of Rickicki's are based on Apple's publicity photos and footage of Kevin Lynch walking around with the device on Tuesday's stage. And if the device is merely gold-plated? It could end up costing much less.

Or it could be more, especially if the body's made from solid gold. Apple itself states that the gold on the Apple Watch Edition is designed to be "twice as hard as standard gold." The device also sports the sapphire crystal display we heard so much about in the months leading up to the launch of both the Apple Watch and the iPhone 6, and even the fancy box for the premium watch doubles as a charger.

The Apple Watch is expected to launch sometime in early 2015.

Follow this article's writer, Leif Johnson, on Twitter.


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It’s absolutely remarkable how badly people want the iPhone 6 [feedly]



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It's absolutely remarkable how badly people want the iPhone 6
// BGR

iPhone 6 Preorder Madness

If it hasn't been made clear from the sheer volume of articles we've posted on the topic in the last 24 hours, a lot of people tried to order the iPhone 6 and 6 Plus last night. So many, in fact, that some sites and networks began to cave under the pressure of the hundreds of thousands of anxious Apple fans hoping to get in line before the first batch sold out.

Continue reading...


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Apple Pay Details: Apple Gets .0015% Cut of Purchases, Higher Rates for Bluetooth Payments [feedly]



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Apple Pay Details: Apple Gets .0015% Cut of Purchases, Higher Rates for Bluetooth Payments
// MacRumors: Mac News and Rumors - All Stories

Apple's ambitious new mobile payment initiative, Apple Pay, was announced on Tuesday during the company's iPhone event. Many questions still linger about the service, but information is beginning to trickle out from various sources as retailers, banks, and credit card companies prepare for the service's October launch.

According to a new report from The Financial Times, Apple stands to make quite a bit of money from its payments service. Banks and payment networks will be forking over .0015 percent of each purchase to Apple, which equates to 15 cents out of a $100 purchase.
They are also paying hard cash for the privilege of being involved: 15 cents of a $100 purchase will go to the iPhone maker, according to two people familiar with the terms of the agreement, which are not public. That is an unprecedented deal, giving Apple a share of the payments' economics that rivals such as Google do not get for their services.
According to bank executives, Apple was able to negotiate with so many partners and receive choice deals because the industry didn't see anything threatening in Apple Pay. One executive suggested that Apple's payment model continued to put banks "at the centre of payments." Apple may also have been able to negotiate better deals due to the tight security it has in place for Apple Pay. Payments will be made via NFC with a one-time token, and also secured with a Touch ID fingerprint.

Additional details about Apple Pay's security have been unveiled by MasterCard executive Jorn Lambert, who spoke to Bank Innovation, explaining how each transaction will be secured.

Along with the cryptogram generated between a standard debit or credit card and a point of sale terminal, Apple Pay takes advantage of a token system that encrypts every step of the payment process. Tokenization is already built into the standard NFC specification, so what Apple is really doing is utilizing existing technology and further securing it with its own Touch ID fingerprint authorization system.

applepay
Every card added to Apple Pay (and located in Passbook) is assigned a token, which Apple calls a Dynamic Account Number. Each Dynamic Account Number is stored in the secure element of the iPhone and accompanied by a unique cryptogram for each transaction.
[Touch ID] authentication prompts the "secure element" to send the token and cryptogram to the merchant. The network decrypts the cryptogram and determines whether it is authentic or not. If it is deemed authentic, the network will pass it along to the issuer (i.e. the bank), which then decrypts the token. In other words, every party to the transaction decrypts something.

Once the issuer decrypts the token and determines that it is authentic, the issuer/bank authorizes the transaction. Money is then credited to the merchant and marked as an amount owed by the cardholder.
The token system essentially provides an extra layer of security to payments made through NFC, which, as mentioned earlier, allows merchants to pay a lower "card present" rate for NFC purchases. Merchants still pay the higher "card-not-present" rate when payments are made over Bluetooth LE rather than NFC, however, or when a purchase is made in-app using Apple Pay.

According to Lambert, Apple is not handling tokenization, instead leaving it up to credit card companies like Visa, MasterCard, and American Express. He describes Apple's role as a "channel and not a party," and Apple itself has confirmed that it won't store any information about transactions conducted by customers.

Apple has plans to roll out Apple Pay beginning in October, and promises the program will work with more than 220,000 U.S. retailers including Walgreens, Macy's, Nike, Bloomingdales, and more. Some stores like Walmart and Best Buy claim to have "opted out" of Apple Pay, but users should be able to make payments via the service at any location that has an NFC-capable point of sale system.

Many retailers are currently in the process of updating their point-of-sale hardware, as an upcoming change will see merchants that do not support EMV credit cards being liable for fraudulent, lost, and stolen cards. EMV credit cards, also known as "chip cards," include integrated circuits to authenticate debit and credit card purchases. The updated point of sale systems with EMV card support being adopted by retailers also generally include NFC, which means Apple Pay may work even at stores that have not specifically chosen to support the service.







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