Linked List: October 29, 2014

Wednesday, 29 October 2014

Sephko on Google conquering the world.

Assessing the Damage Caused by Credit Card Rewards ★

Ron Lieber, writing for the NYT back in 2010:

Life might be simpler and more efficient if retailers could levy a surcharge that covers their costs to accept cards and let consumers figure out whether to pay it. But the card companies don’t allow that, and Congress hasn’t yet forced their hand, though this is now how things work in Australia (where some retailers charge excessive fees, alas).

So what’s an American consumer to do in the meantime? For help answering that, I turned to Dave Hanson. Mr. Hanson, a Spokane, Wash., resident, is one of the savviest card users I know. He also happens to have studied philosophy in graduate school at the University of Chicago and taught applied ethics at Gonzaga University.

He’s not cutting up his cards just yet. “The marginal effect of my individual use of plastic simply won’t impact the larger outcome,” he said. “The assumption that we ought to act in a way that we wish all of us would act ignores the fact that there is no mechanism by which we can ensure that we will all act that way. And we won’t.”

The only practical solution would be for Congress to mandate lower transaction fees. I fail to see how this either should or could be Apple’s problem to solve.

Yahoo Finance: ‘Apple Pay Sides With Credit Card Industry Over Consumer Interests’ ★

Aaron Pressman, writing for Yahoo Finance:

Apple has regularly delighted its customers with cool products on its way to becoming the most valuable company in the United States. But it hasn’t always stood up for its customers’ best economic interests.

Take the case of Apple Pay. Apple partnered with the three major credit card networks, Visa, Mastercard and American Express and the big bank card issuers such as JP Morgan Chase. That is likely a smart move from a business perspective, because so many Apple customers are frequent credit card users and prior mobile payment services have had trouble gaining much traction.

But the partnership decision also meant Apple was taking sides in a long running war between the credit card industry on one side and retailers and consumer advocates on the other.

Retailers typically pay 2% or more on every credit card purchase, costs that cut into their margins and raise prices for all shoppers.

First, the headline. I think it’s clear that Apple Pay is siding with the credit companies and banks — but they’re not pitted against consumers, they’re pitted against retailers. It’s retailers who want to reduce the use of credit cards (and the resulting fees). Not consumers. Any consumer who doesn’t want to use a credit card can simply not use a credit card. (They can still use Apple Pay with debit cards.) Apple Pay is only allowing us to more easily and securely use the credit/debit cards we already have. For consumers, nothing is worse post-Apple Pay (transaction fees are not higher — the banks pay Apple’s 0.15 percent cut), and much is better (security, privacy, and convenience).

I understand the argument that the 2-3 percent processing fees that retailers pay for credit cards are ultimately passed on to consumers in the form of higher prices, but for consumers that can be offset by cash back and reward programs from their card providers.

I don’t understand how this article amounts to anything more than “Apple should have used magic” hand-waving. What could Apple have done differently that would have actually worked, without involving credit card processors? Remember, Apple Pay doesn’t require retailers to install Apple Pay-specific POS terminal hardware. It famously works with the standard NFC hardware that’s been out for years. Building atop the existing credit card infrastructure is fundamental to people’s willingness to try Apple Pay and to retailers’ ability to accept it. Pressman is implicitly arguing that Apple should have somehow reinvented the entire retail electronic payments industry, without the help of the banks or credit card companies, and presumably with the cooperation of retailers. But we see with CurrentC/MCX the sort of things the retailers would have demanded of Apple in such a hypothetical systems.

Update: Another point. Who is to say that Apple Pay won’t add additional non-credit-card payment options going forward? This is just the start. But the start needs to be something that gets the whole thing off the ground.

Towards an Ideal OpenType User Interface ★

Kris Sowersby:

I like InDesign. I think it’s a good application. However, as a maker and seller of fonts, it pains me that a poor interface hinders and obfuscates the OpenType features I build into my fonts. I am certain all other type foundries feel the same. I would love InDesign — and all OpenType-savvy apps — to honour and respect the work we put into our fonts. This also means respecting the user, whether she be a student or professional.

Gerry Leonidas says “prototyping the proposed interface will need to be done in an app-agnostic way, and from a document designer perspective.” He’s absolutely right. My proposals are therefore not limited to InDesign. Anyone is free to steal these ideas!

Much of what he’s proposing is very similar to the typography palette built into Mac OS X’s text system. What I find absurd is that you can use many of these features in TextEdit (Apple’s free text editor), but not in Pages (Apple’s purportedly professional word processor). They worked up through Pages ’09, but were sacrificed in the name of iOS and web app compatibility.