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The new iPhone will be the start of a radical push by Apple to run your digital wallet, starting with tickets, boarding passes, coupons and loyalty cards but likely expanding into mobile payments at bricks-and-mortar stores, analysts and app makers say.
Virgin Australia has confirmed it will be supporting Apple's upcoming Passbook, in iOS6, for boarding passes, while Fairfax Media can reveal that Event Cinemas is working on integrating its ticketing engine with Passbook and have new apps almost ready for release. ShopperNova will offer location-based retail deals from some of Australia's biggest brands.
Independent telecommunications analyst Horace Dediu, who runs Asymco.com, told Fairfax Media that all the signs, including Apple's invitation for the US launch event, indicated the release of an “iPhone 5”. The event begins on Thursday at 3am (Australian time).
Analysts are already predicting Apple will sell eight million iPhone 5 units in the final three months of the year. JP Morgan's chief US economist estimates the new iPhone could do what the White House and Congress failed to do — boost the US economy in a measurable way — by adding between quarter and half a percentage point to US GDP.
Apple has the largest collection of credit cards ... and those users are one click away from making any type of purchase.Horace Dediu, Asymco.com
The new device will run iOS6, which is also expected to be available for owners of previous iPhone models later this month. iOS 6, previewed earlier this year, will include Apple Maps (replacing Google's offering), Facetime video chat over 3G networks, Facebook integration and most likely an upgraded Siri.
But Passbook is one of the key features of iOS6 and allows iPhone users to store movie and concert tickets, boarding passes, loyalty cards and retail coupons in one place.
Could mobile payments at retail stores using iTunes accounts be next? Apple already allows people to pay using iTunes in its own retail stores via the Apple Store iOS app. It has about 250 million account holders who are used to using iTunes to buy apps and media.
“Apple has the largest collection of credit cards, it's even larger than Amazon's collection, and those users are one click away from making any type of purchase,” Mr Dediu said.
He said Apple was “better positioned than anyone else” to bring mobile payments into the mainstream but would likely launch Passbook first and only add payments down the line.
Google has made tepid steps into this area with Google Wallet and other firms including Visa, MasterCard, Commonwealth Bank, ANZ and PayPal have introduced mobile payment systems and apps. But none has hit on a winning formula yet.
Leaked videos, photos and other specifications indicate the new iPhone will be taller (with a bigger screen) and thinner and include a faster processor, 4G network support and a smaller dock/charging connector.
Competitors including Samsung and HTC have already warned Apple that if it releases an iPhone with 4G LTE connectivity they will sue it for patent infringement and demand a sales ban in the US, TechCrunch reported.
Other rumours for the launch include that Apple will launch a music subscription service to rival other offerings such as Pandora and new iPod models. An Apple television set is not expected to be introduced any time soon.
Mr Dediu said the longer iPhone design will make it more comfortable to hold to the ear while the smaller dock connector was also expected to be designed so users can plug it in any way without worrying whether it's upside down.
He said other phones such as the new Nokia Lumia 920 or Samsung Galaxy S3/Note may have better cameras and bigger screens but Apple had always been focused on delivering the best integrated product rather than the best technical specifications.
There were rumours the iPhone 5 may include a near-field communications (NFC) chip for mobile payments but more recently Apple watchers have cooled on this prediction. Passbook would offer Apple a way to enable mobile payments without NFC chips, external partnerships and terminals.
Passbook also allows brands to offer location-based deals to customers who are near their shops. The same feature means your concert tickets will come up on the phone's home screen as you approach the venue.
Darren Winterford, co-founder of Australian retail coupon site ShopperNova, said when Passbook is switched on users will be able to download their app, browse offers from shops around them, and then tap to reserve offers — such as discounts — which are stored in their Passbook. They then take their iPhone to the designated shop and redeem the offer.
“I think Passbook is the first step towards the phone as the new wallet ... there is certainly enough evidence to suggest that Passbook could be linked with iTunes in the future,” said Mr Winterford, adding he expected even things like transport ticketing to be offered by Passbook in the future.
He said ShopperNova had weeks of exclusive offers lined up for Australian brands including Lorna Jane, Oporto, BWS, Westfield, Pie Face, Kathmandu and General Pants Co.
Sydney-based Procwave said it was launching a service that enables businesses to take advantage of digital wallets like Passbook without having to build their own infrastructure and manage things like vouchers and membership cards. Another Australian startup, Stampii, said it was going to integrate Passbook into its tablet-based loyalty platform, which is still in beta testing mode.
Mr Dediu said Apple's apparent decision to continue the sequential naming formula indicated it wasn't planning to release iPhones in other forms such as an iPhone Mini. With the iPad, Apple has removed the numerical naming system and calls the latest model “iPad”, paving the way for an iPad Mini, which the rumour mill suggests will be launched later this year.
“That is significant because again this would make [iPhone] the only product that Apple sells that doesn't have a variation in form factor or a variation in sub branding,” Mr Dediu said, speculating Apple's production facilities may be capable of satisfying demand for only one key smartphone product at a time.
“It's extremely unorthodox; it's ... unique to Apple and unique to the industry and I had been expecting that the uniqueness would end at some point ... we've seen this happening for five years and it looks like it's going to continue to the sixth year.”
Samsung has stayed well away from the iPhone launch but other competitors including Amazon, Nokia and Motorola launched new flagship devices earlier this month. Mr Dediu said “everyone now is indexing their vision, their strategy, their operations to the iPhone”.
“It makes no sense to launch against the iPhone, the iPhone sucks up not only all the buying decisions but all the visibility and media attention; you have the black hole effect — you can't stand too close to it otherwise you get sucked in,” he said.
“I think everyone's thinking about the same question — how do I work around the gravity field that Apple is creating?”