Focus on the core of the big Apple launch tomorrow

The age-old process of paying for things has had an appealing simplicity throughout human history, marked by relatively few fundamental changes – the era of barter gave way to money, and the use of cash has been supplemented by the use of credit cards. Simple.

But for a few years now, we have been promised a major new innovation in this area – mobile payments, goes the story, would change the way we pay for things, with our smartphones transformed into electronic wallets. Paper cash and plastic cards would be slowly but irrevocably consigned to the history books.

And these promises were coming from some of the biggest players in technology – Google released the Google Wallet, PayPal launched various dongles and apps, Square made cool videos showing their technology working like magic in trendy cafes.

The vision of a world where payments could be made effortlessly without the hassle and friction of taking your wallet out of your pocket or handbag was pretty compelling.

There was just one thing about this particular story – it never really made the move from much-anticipated technological possibility to widely adopted technological reality. There are lots of reasons why nascent technologies fail to gain traction “in the wild”, and the realm of mobile payments might very well be the perfect case study.

First, a lot of the actual technology has been a little on the clunky side – most e-wallets have relied on NFC, which stands for near field communication, a typically ungainly acronym for a radio technology designed to allow two gadgets that are close to each other to exchange information securely. But NFC has never really gained critical mass.

But even if it had, the payment space has so many vested interests and wannabe incumbents trying to extract their portion of the value chain, thus ensuring that no standards ever become accepted.

The mobile operators assumed that they would be the principal pioneers in the space, what with all the billing information they already possess – all over the world, network operators have resisted the unavoidable reality that they are mere dumb pipe providers, deluding themselves into thinking they are technological pioneers in their own right.

Then the smartphone makers inevitably try to ensure they get a cut of the money flowing through their devices. Then the likes of Google and PayPal come up with competing solutions for vendors and device manufacturers to contemplate.

And above all, there are the real incumbents in the payment space, the big credit card companies, who own the keys to the payment space and aren’t just going to hand them over. They have long used strong-arm tactics with all sorts of upstarts who attempted to rival their stranglehold on card payments by undercutting their commissions, and there’s no way they will just let the matter of a transition to a new technology to disrupt them.

All of which presents quite an intractable problem for anybody hoping to finally bring mobile payments into the mainstream.

Except for one company, of course. Not for the first time, Apple is poised to solve a riddle that has confounded everybody else who tried to tackle it.

For years now, there have been persistent rumours that Apple would include NFC ahead of every iPhone release since, oh, 2010, and longtime speculation that the tech giant would introduce its own payment system.

Finally, it appears that all that vague speculation is about to come become reality at tomorrow's feverishly anticipated launch event in Cupertino. It is, without exaggeration, the most anticipated Apple event since the iPad was unveiled by Steve Jobs in 2010, and while the long-rumoured iWatch is attracting most of the attention, the introduction of a new payment system will demonstrate just how confident Apple really is at the moment.

To understand why only Apple is in a position to solve this conundrum, there are a few key things to appreciate.

First, Apple can offer a technological offering that will reach critical mass far faster than previous offerings - that’s what selling tens of millions of devices can do for a burgeoning technology. Second, you can be pretty confident that any such payment system is going to be easy to use, which has never really been the case with previous mobile payment systems.

Third, and most important of all, Apple is uniquely positioned to deal with all those incumbents who previously stymied the widespread adoption of mobile payments, in that they can offer an integrated software and hardware system, unlike say Google or Samsung.

They can tell greedy mobile operators where to go, just as they have done since the iPhone first arrived. And perhaps most tellingly, their incentives are already aligned with the credit card companies, in that they are not offering a rival payment system but rather a new credit card payment mechanism - the system is rumoured to work with a secure enclave on the processor to store credit card details. Combine that with the TouchID fingerprint recognition on iPhones for authentication, and the pieces begin to fall into place.

The history of paying for things, it seems, might be about to get a fresh injection of innovation.