Festivus And The Airing Of The Payments Grievances

Every year there are a plethora of stories every year about the war on Christmas, followed by the plethora of headlines about why there is no war on Christmas. What all of these stories have in common is that they miss the point about Christmas and warfare - when it comes to Christmas it is not an external war, but an internal war where everyone struggles with both enjoying the holiday season and a mounting feeling of annoyance with all of the pressure to deliver peace on Earth and goodwill towards men, including members of your immediate family. .

Because there is only so much goodwill than anyone can stand, the Holiday of Festivus was born. We can thank Seinfeld in the mid 1990-s for actually giving us a holiday within a holiday where we get to do what the holiday season somehow manages to instill in all of us – the need to air our grievances.


And so in honor of Festivus, PYMNTS brings to our readers the Payments Airing Of The Grievances


1. “The merchants of MCX created MCX.  They invested their time, their talent and their money to build a consumer friendly solution… Our merchants have to make a choice about the consumer experience they want to offer.” - Dekkers Davidson, CEO MCX

It has not been an easy season for MCX, the once and future creators of the CurrentC mobile wallet. It was tough enough have to endure weeks of enraptured headlines about how Apple Pay was going to change the world but then during launch week for Apple Pay, MCX both saw its servers breached (no financial data was lost) and headline after headline about how they were forcing the retailers that signed on with them to pull the plug on their NFC capabilities in order to honor the non-compete agreement they signed with MCX.

MCX has done it’s best to respond--noting that it is not hostile to competition in general, just right now while the mobile wallet is trying to get it’s footing. They also strongly disputed reports that they planned to fine retailers who jumped ship to Apple and NFC, instead noting over and over that this isn’t about punishment, it is just about making a choice.

They also noted that someday they might be open to NFC and allowing credit cards in their mobile wallet. Just not now. Or on a date they are willing to specify.


2. “I don’t know of any two-sided platforms, let alone payment platforms, that have ever succeeded with a “go broad/go shallow” strategy. The mathematics of ignition should make us pretty dubious that this strategy could work.” - David Evans, Founder MPD

It’s not easy to get a two-party platform to ignite, in fact Dr. Evans noted that the difficulty lies somewhere between running a mile in four minutes and solving Fermat’s Last Theorem. But it can be done, as MasterCard, Visa and Uber have done by employing a “Go Local/Go Deep Strategy,” or as Discover did with a and “Go Broad/Go Deep Strategy.” What Dr. Evans has a hard time imagining is how Apple can make a Go Broad/Go Shallow ignition plan work, since it seem that math would indicate they will never be able to reach the critical mass of consumer and merchants in a time frame that is relevant enough to get it to genuinely take off.

continental_advisors-95f4218ffa2b4e6b34cb37b0c9c69ba43. “I am not sure that you will get an argument from me, but again I don’t know why they are pivoting to a protocol that’s older than all my children combined.” - Paul Purcell, Principal, Continental Advisors

Paul Purcell does not come to bury EMV, he just is not sure that it is the great white hope of payments security that some have held it up to be, considering it is a 20 plus year old solution that was designed to deal with different set of problems in Europe, well 20 years ago. Those problems, are way different than those that the contemporary U.S. payments ecosystem faces. Given that, Purcell thinks it at least bears wondering if it justifies the cost, confusion and complexity that retailers in the U.S. will be expected to deal with as a result of the coming liability shift. Purcell is all for fixing the security problem, he just wishes that it was based on something younger than the combined ages of his beloved offspring.

 cortex-logo4. “We could give a DNA sample at the point of sale, right, but the gears of commerce are going to come grinding to a halt.” - Shaunt Sarkissian, CEO Cortex CMP

It has not been a banner year for payment security, since hardly a month of 2014 passed without a major retailer seeing its POS system breached and consumer data go out there door and onto the open market. It is unsurprising then that the participants at IP 2014 in March were focused on what the next phase of payment security might be, though they didn’t all agree on what the best solution. Sarkissian was one of the participants in the discussion and noted that the solutions for payments security aren’t merely mechanical--the technology exists to make payments totally secure, but the solution can’t just be secure it also has to be invisible. Consumers care about security he noted, but they actually care a lot more about convenience.

5. “B2B Payments Are Just Broken” - Drew Hofler, Ariba  

Paper checks are dying or you are one of the millions of businesses that still use them to pay another business. In that case, the odds are pretty good that you’re still quite good at writing checks. And yet, B2B payments isn’t broken because of an intrinsic love of paper, says Hofler, B2B payments suffers from system wide problems that make upgrading to digital nearly impossible because in the complex world of B2B payments it isn’t just the money changing hands, it’s the data about the money (and what exactly it is paying for) is just as important. Until that problem is solved for, B2B payments will stay broken, Hofler says.


6. The ILWU’s orchestrated job actions are threatening the West Coast’s busiest ports and potentiallybillions of dollars in commerce, - Wade Gates, Pacific Maritime Association

The situation at the Port of Long Beach has been deteriorating for months--dock workers complain they are underpaid, the docs complain that the workers are intentionally slowing down shipping to force a favorable settlement. The result--goods and services are just sitting there--something for months longer than they should be. The goods news is that it likely won’t affect holiday retail as much as it was initially feared it would-- merchants have moved to alternate shipping plans like air freight to avoid shortfalls. The bad news, that will eat into retailer profits this holiday season.

 alibaba-logo7. This month I’m not very happy—I think too much pressure... If I’m not happy, everybody’s jumping like monkeys. That’s not good.” - Jack Ma, Chairman Alibaba


Jack Ma is the chairman of a company that had the largest IPO in NYSE history, he is the wealthiest man in China and is by some accounts on track to take over the (online retail?) world. And yet even he too has a Festivus grievance to air--it is all too much pressure being a publicly traded company where everything that he has done is now under the glaring spotlight of Wall Street and investors. Ma apparently liked being an entrepreneur and innovating--this whole being a titan of industry thing seems to take a little getting used to. Still he’s resigned to getting happy and avoid hopping around like a monkey, which is likely a great relief to all who invested in Alibaba (and work with him).

5a63625e9c1cd2c343da38a4b571aee0 (1)8. “At best, David S. Evans has a keen grasp of the obvious. Except for those things about which he is wrong.” - Patrick Byrne, CEO Overstock


PYMNTS founder David Evans should be officially declared the Santa Claus of Festivus, since he literally delivered a grievance from someone. In this case it was the CEO of and bitcoin enthusiast Dr. Patrick Byrne, who went on to suggest that Dr. Evans might have some difficulty distinguishing a part of his body from a hole in the ground given his comments and perspective on the topic. This came in response to Dr. Evans observation that Overstock didn’t really “take bitcoins,” since it actually turns the bitcoins it accepts as payment into dollars immediately.

For his part, Dr. Evans responded.

“The hysterical reaction is puzzling since the point of my article is simple and no one, including Patrick Byrne, Overstock’s CEO, seems to disagree with it. When you use your Coinbase wallet to pay for something on Overstock with bitcoins, gets paid in dollars.”


9. “We didn’t get the price right. I think people come to expect a great value, and we sort of mismatched expectations.” - David Limp, SVP Devices, Amazon


This was in response to analyst grilling on the spectacular flame out of the Amazon Fire Phone. You’ll recall that this phone was launched in June of this year and positioned as the ultimate smartphone/shopping phone. It came equipped with an app that enabled effortless showrooming, a forked version of the Android operating system, an iPhone-esque price tag and not many buyers. Turns out that smartphone users really like apps, which requires developers to produce apps, which requires consumers who can download them. At the moment, the only charges being made that are in any way related to Amazon’s Fire phone is to Amazon’s balance sheet. So far, Amazon has taken a $170M charge given the lackluster sales performance and has ~$100M of unsold phones in inventory.

unnamed10. “Despite how often consumers use point-of-sale payment terminals, our research indicates consumers tend to overlook the hardware. Swiping is an ingrained behavior” - Cie Nicholson, Softcard’s senior vice president of marketing



Yes, this is true and perhaps the hugest grievance if you are one of the many third party mobile wallets that are trying to get consumers to change their behavior. But, Softcard is out to change all of that with its new public service campaign to remind considers to tap and not swipe, which even includes a mascot. Tapper, which was introduced to the world last month, is muppet that sings and dances and shows consumers how to tap and not swipe. It is, apparently, just what Softcard believes all of those early adopters with their NFC-phones need to push them into the mobile payments zone. Tapper certainly has work cut out for him since, at least so far, very few people are following his lead. We will have to wait to see if, next year, Tapper has his own grievance to air.



Banks, corporates and even regulators now recognize the imperative to modernize — not just digitize —the infrastructures and workflows that move money and data between businesses domestically and cross-border.

Together with Visa, PYMNTS invites you to a month-long series of livestreamed programs on these issues as they reshape B2B payments. Masters of modernization share insights and answer questions during a mix of intimate fireside chats and vibrant virtual roundtables.

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