Last Wednesday, I was fortunate to appear on CNBC’s Closing Bell to discuss Apple’s (AAPL) precipitous, post-earnings selloff.
You’ll recall, the stock fell to its lowest level in three months, thanks to disappointing iPhone sales.
The crux of our debate centered on investors’ perception that Apple is in an “innovate or die” situation. I disagree.
Well, during the segment, anchor Kelly Evans challenged my assertion that Apple has big plans for a mobile payment system (more on that in a moment).
Meanwhile, Bert Dohmen of Dohmen Capital zinged me at the end for my outlook on the stock.
In any event, check out the footage and let me know what you think.
So let me give you a full rundown now…
- According to The Wall Street Journal’s sources, CEO Tim Cook and Eddy Cue (who oversees Apple’s iTunes Store and App Store) recently met with industry leaders to discuss handling payments for physical goods and services.
- The company’s been on the hunt for a mobile payments guru to spearhead its efforts, and decided on longtime Apple executive, Jennifer Bailey.
- Patent application #20140019367 was made public on January 16. This one is huge, since it details a “method to send payment data through various air interfaces without compromising user data.” (It won’t be long before ALL commerce moves to mobile, which would eliminate the need for cash – and coins – entirely!)
- Executives from eBay’s (EBAY) subsidiary, PayPal, offered to help Apple manage its mobile payments service. I’m sorry. But when the competition is trying to join forces with you, it’s obvious the threat is real, imminent and significant.
- And as I shared last February with Tech & Innovation Daily readers, in the span of a few short months, Apple secured all the necessary pieces to incorporate biometric identification and mobile payment capabilities into a device – the patents, the software and the hardware. (Then the company rolled out the iPhone 5S.)
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Call me brain dead if you want (Mr. Dohmen did), but it’s pretty clear to me that the company is now bolstering its mobile payment capabilities in preparation for a broad deployment.
For good reason, too.
Forrester Research estimates that Americans will spend $90 billion over mobile payment platforms by 2017, up from only $12.8 billion in 2012. That’s a 603% increase.
And as Forrester’s Denee Carrington says, “Apple is absolutely the sleeping giant in the payments world. They have the capability; they just haven’t tied it all together.”
Not yet, that is. But all the evidence points to it happening as we speak.
Bottom line: As Mr. Icahn stated in his recent letter to Apple shareholders, “We believe a revolutionary payments solution is now a very real opportunity that the company could choose to pursue.”
Newsflash: They’re pursuing it right now! And I’m convinced that it promises to be the pivotal “innovation” that propels Apple’s stock higher in the coming year.
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Ahead of the tape,