Merchant Innovation

Yes, No, Maybe: Amazon, eBay And Apple

With Iowa in the bag and New Hampshire set to be decided a little over 24 hours from now, election season is officially in full swing.

The mainstream news media can finally give themselves over totally and completely to the full-blown horserace coverage they’ve been dreaming of since 2012.

This is incredibly good news for political junkies and incredibly bad news for any other type of news enthusiast wondering what else is going on in the world.

If the last few election cycles are any indication, if it isn’t the Olympics or the crack-up of the U.S. economy, don’t expect to hear a whole lot about it before Nov. 9.

Lucky for PYMNTS’ readers, there’s always good news on Mondays in the form of the Data Dive, giving you the chance to keep up with everything you need to know about payments and commerce.

So, while everyone else is shaking off the last of their Super Bowl stupor this morning, you can be bright-eyed, bushy-tailed and ready to go with all the need-to-knows.

Which, this week, are about how big names — Amazon, eBay and Apple — are saying yes, no and maybe.

 

Amazon Says A Big “Yes” To Logistics

Were there a competition for worst kept secrets in payments and commerce, Amazon’s ambition to build and operate the world’s premier logistics service would probably be a lock for the gold medal.

Whether it’s shipping via planes or ships or developing a drone network all its own, the eCommerce giant has made it clear that it wants to rely less on third-party companies, like UPS, and instead invest more into building its own shipping empire.

And why not?

Now, more information on just what the empire will look like is up for grabs, via a new securities filing that indicates Amazon is looking to build “companies that provide fulfillment and logistics services for themselves or for third parties, whether online or offline.”

The document also notes that “transportation services provider” might be the preferable designation for the company.

According to Wall Street Journal reports, this filing marks a first-of-its-kind piece of documentation from Amazon regarding its shipping business.

Amazon itself has no official comment on the filing, but its actions over the last half-decade largely speak for themselves.

Amazon has already used its own trucks to move goods out of its warehouses and has worked to build up its logistics services in order to combat rising shipping costs through having its packages delivered through a third party.

There’s also been talk about Amazon turning its logistics operation into a shipping option for other retailers. And during its most recent earnings call, Amazon talked up its increased focus on cooperative logistics.

“In order to properly serve our customers at peak, we’ve needed to add more of our own logistics to supplement our existing partners,” CFO Brian Olsavsky said during Amazon’s Q4 earnings call with analysts last week. “That’s not meant to replace them, and those carriers are no longer able to handle all of our capacity that we need at peak. They have been, and continue to be, great partners, and we look forward to working with them in the future.”

Amazon’s current official story seems to be that it isn’t replacing its current partners; instead, it just wants to expand on them. However, not everyone is quite convinced that Amazon’s plans don’t involve eventually competing with those current partners more than collaborating with them.

“We continue to expect Amazon to add logistics, primarily to meet its own growth, but over time and in incremental fashion, we believe it is likely that Amazon will offer this expertise to third parties to help subsidize those costs,” Colin Sebastian, a Baird Equity Research analyst, told WSJ.

And then, of course, there’s the news that it will open more “bookstores” all over the U.S. While not entirely checking the box as “transportation services provider,” having physical space in locations where inventory can be warehoused and then delivered same-day (even same-hour) to customers is probably also on the list.

How much third parties, who have to compete with Amazon, will want to collaborate on shipping (giving Amazon access to data on how many goods they ship and where) remains to be seen.

 

eBay Says “No” To Fully Patching A Bug

For an eCommerce merchant, the only headline worse than the one about a security flaw that puts one’s customers’ data at risk is the headline about the security flaw you aren’t fixing that is still putting customer data at risk.

And such was the headline set that eBay ended up with this week.

Check Point Software notified eBay of a potentially crippling malware protection flaw. Normally, such notifications are followed by a rush of patches and press releases. This time? Nothing. Crickets.

That’s the story from Oded Vanunu, a researcher with Check Point who first noticed a bug in eBay’s JavaScript code policies. The flaw allows users to embed their own executable JavaScript code on pages to phish account information away from legitimate users. While users still have to give initial access to the phishing code, once it’s in, it can crawl everything in a user’s account.

Vanunu and Check Point report contacting eBay in mid-December about the flaw, but it wasn’t until Jan. 16 that they heard back.

And what they heard was surprising. EBay said it wouldn’t be issuing a fix for the flaw and provided no reasoning for the inaction.

Why?

An eBay spokeswoman reached out to PYMNTS and explained.

“It’s important to understand that malicious content on our marketplace is extraordinarily uncommon — we estimate it to be less than two listings per million that use active content on the eBay marketplace.”

“EBay is committed to providing a safe and secure marketplace for our millions of customers around the world,” the spokesperson told PYMNTS. “We take reported security issues very seriously and work quickly to evaluate them within the context of our entire security infrastructure. We have not found any fraudulent activity stemming from this incident.”

There is some speculation that eBay’s reluctance to fix the bug could be tied to overall site performance.

 

Apple To ATMs: Call Me Maybe?

Whatever else can be said of Apple Pay, when history is writing the story of the early days of mobile payments, it will always get the award for sticking with it and trying to get sticky for consumers.

Next move? ATMs.

According to reports in TechCrunch based on everyone’s favorite type of source — an anonymous one “familiar with the teams on the projects” — both Bank of America and Wells Fargo are working to bring Apple Pay to their ATMs.

Wells Fargo, as noted by Jonathan Velline, head of ATMs, right now is not focused on Apple Pay specifically, having instead decided to bet on Android Pay for its initial push into NFC ATMs. He did, however, leave the door open for Apple.

“We’ve been working on the technology that allows us to hook to digital wallets, leveraging NFC on mobile phones to replace the card at the transaction at the ATM. Right now, the wallet that we support is Android Pay. But we’re also looking at lots of different mobile wallets and evaluating which ones are going to be appropriate for our customers. We’ll likely add more mobile wallets throughout the year. We recognize our customers are going to have lots of different types of wallets based on their device, based on their bank, based on their OS, and we’re going to continue to find the right balance of which wallets we’re going to support.”

Bank of America’s consumer banking products press representative, Betty Riess, confirmed that BoA is currently developing a new cardless ATM solution.

“This solution will enable customers to leverage NFC (near-field communication) technology on their smartphone in order to authenticate and complete transactions at a Bank of America ATM. We will roll out this capability in late February, with associates at select ATMs in Silicon Valley, San Francisco, Charlotte, New York and Boston, followed by a broader rollout to customers mid-year.”

TechCrunch reported that an Apple Pay/ATM continuum might entail users tapping their phones at the NFC point of contact provided at the ATM. That, in turn, would prompt a user verification via thumbprint or PIN.

With “might” being the operative word. But, hey, we took the bait and wrote about it.

 

So, what did we learn this week?

Amazon wants to sell you everything you buy, but even if it can’t get you to buy something from someone else, it might be happy to settle on delivering it to you. EBay takes security seriously but just says “no” when all that’s at risk is getting the rumor mill mad at it. And, finally, Apple Pay might be coming to an ATM near you, but it doesn’t seem to be at the top of the “yes” list for at least one of the big banks to adopt cardless ATMs.

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Latest Insights:

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. The September 2019 AML/KYC Tracker Report provides an in-depth examination of current efforts to stop money laundering, fight fraud and improve customer identity authentication in the financial services space.

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