How can Apple Pay Extend NFC Payment to Other Areas ?

Apple Pay NFC System ExtensibilityApple Pay & Passbook have the potential to be very innovative and disruptive to many everyday user experiences. Apple is able to derive the most economics from getting a cut of credit / debit transactions that are enabled through Apple Pay as well as driving incremental revenues through the burgeoning mobile advertising network. As Consumers view fingerprint authentication technology to be more secure than current swipe transactions. Recent credit card security breaches by Target, Home Depot and various banks add focus to this in the minds of consumers. The ecosystem can be extended further with a win – win solution for all as detailed below.

Integrating Apple Pay with Apple’s iAd mobile ad network in the form of a tap-to-buy button embedded in mobile ads. This would allow app publishers that work with iAd to generate more mobile ad revenues from their apps. Apple keeps 30% of the revenues generated from sales (more…)

How Paypal Makes Money after Spin off from eBay ?

How PayPal Makes MoneyNot many of you all have an understanding on how eBay’s PayPal segment makes money (sources of revenue, the fees (take rates) by segment, the impact of geographic mix, the impact of P2P on take rate, etc.). This issue will become increasingly important, as investors focus in on the potential impact of the proposed split of eBay and PayPal and the value and mechanics of the two businesses.

eBay’s Payments segment revenue can be split into 3 main categories – on eBay, Merchant Services (off eBay) and Person-to- Person (P2P). At a high level, it is estimated that eBay Transaction Volume of $61.1bn in CY14 and Transaction Rev at $3.1bn, with an avg. transaction fee of 5.1%. We estimate (more…)