Identity Wars: Why Apple Pay Is About More Than Payments

There's been no shortage of attention paid to the launch of the new iPhones, with their array of shiny new features, bigger screens and better hardware. Early reviews seem to indicate that the company has, yet again, come through with another massive success.

Many of those who stood in around-the-block lines or refreshed their Internet browsers incessantly just for the pleasure of pre-ordering probably were thinking about the differences between the two new phones: Do I get the model with the 4.7-inch screen or the 5.5-inch screen? Do I go with the space gray, gold or silver finish? Do I really need the 1920-by-1080-pixel camera resolution?

All perfectly fair questions to ask when buying a new phone but not as important as this: When you buy the new iPhone, you're not just purchasing your next phone; you're making a decision about the future of your digital identity.

Back in June when Apple announced the release of Touch ID for developers at WWDC, the company shrewdly made its entrance into the consumer identity market. And with good cause. Apple is one of the worlds most trusted and revered brands (even after the infamous iCloud celebrity photo leaks), has over 200 million credit cards on file from iTunes accounts and a bevy of devices that users need to authenticate their identities on.

Now, with the release of the iPhone 6 and iPhone 6 Plus, Apple finally has the pieces together by combining NFC, seamless authentication and relationships with leading financial institutions. With this combination, it seems Apple has set its sights on ensuring that Apple ID is the identity of choice not just for payments but for everything.

Consumers have been longing to get rid of passwords for years. Ad nauseam, we've heard the clamors for the end of passwords because of the deluge of usernames and passwords we have amassed and the inherent security issues and frustration they create. Imagine never needing to create another user name or password again for any site or app by using your Apple ID. That's what Touch ID promises.

Ultimately, Touch ID and Apple Pay are proxies for Apple ID, which is becoming paramount to what is sure to be a strategy to overtake other identity providers.

Consumers will love using Apple ID for authentication on sites and apps because of the seamless experience imagine being able to authenticate quickly not only at point-of-sale systems and mobile apps using your thumbprint but also on third-party sites just by having your phone in close proximity to your computer.

Businesses, or relying parties, will love it because they'll get more registrations, identify more customers across devices, and have lower shopping cart abandonment. Apple, in turn, will establish more permanence with users, further entrenching them into the Apple ecosystem.

Google/Google+ ID has gained steady momentum over the last few years and the fact that it has tied identity to its own set of phones (Android) will be important in continuing that growth. Similarly, Amazon, which became an identity provider with the release of Login and Pay with Amazon in 2013, has also taken on the hardware + software identity strategy with the launch of Fire Phone handsets.

Digital identity is evolving quickly, and as consumers are presented with a greater variety of authentication methods, the competition to become the de facto identity provider among some of the worlds biggest companies is heating up. Apples entrance, with Apple Pay/Touch ID as its Trojan horse will put pressure on many of these other providers to offer features like payments or even mobile phones, with features like biometric authentication.

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