The new era of the phablet is here, and Samsung, which unveiled two new devices on Thursday (Aug. 13) in New York City, wants you to “note” that it has an “edge.”
That sums up Samsung’s shot across Apple’s smart device bow, as the Korean tech giant takes long strides (and not baby steps) to reverse market share loss in the smartphone industry. The fickle consumer has in turn put a damper on Samsung, as operating profit in the fiscal second quarter slid 38 percent year over year to $2.8 billion.
And, as the financial and tech trades pick apart the new features of the Galaxy Note 5 and the Galaxy S6 Edge — from high-definition video to wireless rechargeable batteries to improved functionality of the stylus pen — let’s step back for a moment from the throngs that ringed the Unpacked tables and no doubt will queue up when both devices launch in the U.S. and Canada-based stores on Aug. 21.
Hardware is only as useful as the apps and software that run on it. For the payments and eCommerce industries, there was plenty to chew on at the Thursday event.
Of immediate importance: Samsung said at the Unpacked event that it is (finally) launching Samsung Pay, which will come preloaded in the Galaxy S6 edge+ and also the Galaxy Note 5. There will be an initial rollout in Korea next week, on Aug. 20, and then in the U.S. on Sept. 28. And the leapfrogging across countries will continue unabated, as Injong Rhee, who heads Samsung Pay, promised from the stage in New York. After being established in Korea and the U.S., the payments platform will then be available in Europe, via the United Kingdom, and Spain, and also in China, though launch dates were not provided.
With firm dates in place, along with targeted geographies, the Samsung Pay announcement may resolve a series of “false starts” that plagued the payments system over several months and puts the company in the mobile payments game, possibly predating Google, though lagging Apple. Tellingly, one of the screenshots that flashed up earlier during introductory remarks by JK Shin, CEO and head of mobile communications and IT at the company, read “Next is Now.” For payments, at last, “next is now” too, or at least, “next is soon.”
Some specs about Samsung Pay, as noted by the company: The platform will work in combination with NFC payments and what they call the "MST" system, which will in turn ensure that Samsung Pay works with just about every POS terminal across the globe — a feature that implies that merchants will not have to “redo” their technology. As Rhee delivered his remarks, graphics behind him also gave a hint as to how Samsung Pay might look interfacing with a user: One graphic gave instructions showing how to swipe a smartphone in a NFC setting. In a demonstration last week with PYMNTS, Samsung executives showed some workings of the technology, in which users can “swipe” through their cards and then choose one (via fingerprint button) with a simple motion of holding the phone up to a reader in order to pay.
Initial partners include the major credit card networks — Visa, MasterCard, Discover and American Express, and some big issuers including Bank of America, Chase and U.S. Bank.
On Thursday, it was disclosed that the payment feature has already been signed on to launch as part of MasterCard’s Digital Enablement Services with Samsung Pay to be an option across its credit, debit and prepaid cards.
Similarly, Samsung Pay will also be part of Visa’s Digital Enablement Program, through which Samsung will be able to offer secure mobile payments to Visa cardholders through tokenization.
The tokenization, via one-time-use security codes, takes its place alongside fingerprint identification and Samsung KNOX, which has been a staple of Samsung’s data.
As Rhee told the audience at Unpacked, Samsung Pay will also enable contact payments for store-branded credit cards. Related to that, Synchrony Financial, which is the largest provider of private-label credit cards in the United States, announced on Thursday that it, too, is working with Samsung Pay to enable mobile payments to 300,000 retail locations, without the need for existing terminals or POS devices to be changed.
In an interview with PYMNTS on Thursday, Carol Juel, who serves as Synchrony Financial’s chief information officer, stated that the typical 11-digit customer account number that has been a mainstay for routing private-label transactions now will be replaced by a 16-digit token, while still maintaining the transaction as “private label,” which the executive said “fulfills the security requirements of the transaction but also maintains the valued services that the retailer needs to conduct their business.” That valued service is the preservation of the PAN that is the cornerstone of the retailers’ loyalty programs and CRM systems.
Samsung Pay will extend to merchants across all three of Synchrony’s three private-label credit platforms: its top-tier retail program (20 large merchants), its payments solutions platform, which has a more middle-market focus and includes 7 million accounts and retailers such as P.C. Richard & Son, Ashley Furniture and Sleepy's, and its CareCredit platform, which serves providers across the veterinary, dental and other health care disciplines.
And what of the devices themselves?
Both new devices sport the same cameras, which have been lauded by smartphone enthusiasts. And there are also wireless charging options. And now, according to Samsung, there’s also the ability to send out live video (through YouTube, of course). One hardware feature of note: a keyboard that can be locked into place over the screen, for those who want a more tactile feel as they text or conduct business.