Apple will allow rival companies to use wallet technology on its iPhones for free for 10 years, European Union regulators said Thursday, the latest overhaul prompted by local rules.
Apple’s mobile wallet lets iPhone users pay for products in-store and online using its own-brand Apple Pay. Until now, Apple has not made its Near Field Communication (NFC) technology, which allows phones to communicate with payment terminals, available to rival developers, prompting the EU to warn in 2022 that restricting access to the technology could be seen as an abuse of market power.
Apple's concession ends a two-year dispute between the Big Tech giant and the European Commission over the company's payment technology. The change, which Apple first proposed in December, means the smartphone maker will avoid billions of dollars in fines and a formal declaration from Brussels that it has broken EU rules.
“[Apple’s commitment] “It opens up competition in this crucial sector by preventing Apple from excluding other mobile wallets from the iPhone ecosystem,” the EU's competition chief Margrethe Vestager said in a statement.
“Competitors will now be able to compete effectively with Apple Pay for mobile payments on iPhone in stores, giving consumers a wider range of secure and innovative mobile wallets to choose from.” The changes will last for at least 10 years and will only apply to users who live in the European Union, as well as Iceland, Liechtenstein and Norway.
Apple's decision to expand access to NFC means developers in Europe can implement the technology in iOS apps for uses like car keys, business badges, hotel keys and event tickets, Apple spokesperson Julien Trosdorf told WIRED.
“Apple Pay and Apple Wallet will remain available to users and developers in the EEA,” he added.
For years, Apple has kept a tight rein on the technology available to the millions of people who use its devices. But intensifying EU scrutiny and new regulations have forced the smartphone maker to make some significant changes to the way it operates.
In response to EU complaints, the company must now allow alternative app stores on iPhones and iPads, creating competition for the Apple App Store for the first time. The company must also offer “choice screens” when users buy a new Apple device, giving them the option to install Apple's own-brand apps or third-party alternatives. The company is also appealing a nearly $2 billion fine that focuses on rules and restrictions imposed on third-party developers building iOS apps.
