Evan Schuman's StorefrontBacktalk

Does Apple really plan to use Bluetooth instead of NFC for mobile payments? Probably not, but you’d think so based on the buzz over the past week from the Apple-watching echo chamber. The consensus: All iPhones and iPads now have Bluetooth built in. It will take years for NFC to get into enough phones to matter. Ergo, Apple will use Bluetooth for its mobile wallet and sweep the table.

That’s unlikely—if widely deploying a technology was the problem, contactless cards would have wiped out magstripes years ago. But will Apple use Bluetooth for payments? We may know by the end of the summer.

The “Apple will use Bluetooth to destroy the cash register” line has been showing up all week in Apple blogs and the IT trade press. The comments all appear to stem from a report last month from retail analyst Pablo Saez Gil of the U.K.-based analysis firm ResearchFarm, in which Saez Gil points out the obvious (NFC-based mobile payments aren’t exactly taking off like a rocket) and the less obvious (Apple has upgraded its iPad and iPhone Bluetooth so it can now be used the way NFC is).

Let’s be clear here: In his report, Saez Gil qualifies his speculation. Right after pointing out Apple’s Bluetooth upgrade, he adds, “Whether [Bluetooth] will play a role on m-payments or not remains to be seen, but the technology is in many ways superior to current NFC offerings and can enable new features in m-payments such as long-distance check-outs.”

Here’s how that translates after a month in the echo chamber: “Apple’s secret plan to kill the cash register.”

What’s wrong with this picture? (Leaving aside the fact that no one who actually understands retail IT or mobile payments would actually refer to a “cash register.”) The reasons are old hat to anyone at a retail chain: Not everyone has an iPhone. Plastic cards are ubiquitous. Not everybody uses plastic instead of cash. There are transaction security and loss-prevention issues. The easy part of a card transaction is the swipe or tap or button-push; the harder part is the complicated back-end arrangement, but hardest of all is changing customer behavior.

So for an Apple Bluetooth-based mobile payments system to bump the existing in-store payments stack, first it would have to address all those problems. Then it would have to convince retailers to make a major POS investment (that is, another major POS investment, after just adding EMV and contactless). And then any new system would have to coexist with the existing payments stack during a long transition.

No matter how much other retailers admire the glitz of Apple’s own stores and are ready to buy iPads for in-store mobile payments—always equipped with sleds for reading magstripes—that’s just too big a step to be credible.

Then there’s the fact that even Apple Stores aren’t using anything other than magstriped plastic cards for in-store mobile payments—at least not yet.