Apple opens up Apple Pay to rivals in EU antitrust deal

Apple (AAPL) has reached an agreement with European Union (EU) regulators concluding a long-fought legal battle over antitrust concerns. The tech giant will open up its mobile payment system, Apple Pay, to third-party competitors. This move will allow other companies to integrate their payment services directly into the Apple Wallet on iPhones, ending Apple’s monopoly over payment systems on its devices within the region.

Catalysts co-hosts Seana Smith and Madison Mills break down the details.

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This post was written by Angel Smith

Video Transcript

Apple looking to ease regulatory pressure from the eu the regulator accepting commitments from Apple to open up its mobile payment system.

Apple pay to competitors this deal bringing an end to the EU four year investigation into Apple and shot what’s interesting here and just for the context for folks who maybe aren’t using this to swipe into the metro every day, the wallet lets consumers store your debit card, credit card tickets to concerts, your plane ticket.

And now third party developers are going to be able to access the tech that backs that wallet for Apple.

So this could be a boon for Samsung looking to provide their own wallet utilizing that similar technology.

Also other competing platforms like a paypal, maybe even an alphabet, for example.

And then moving forward, if this does extend to the US in some meaningful way, it could also be an upside catalyst for a name like square that could develop its own in competition with Apple.

But of course, the regulatory question mark here is the key headwind for a company like Apple.

And it’s interesting to get a sense from this about how they’re going to be approaching that.

Yes.

So they resolved this issue at least for now when it comes to some more of those details.

And the commitment remains binding for 10 years and Apple versus fine for as much as 10% of global annual revenue.

If it does violate this agreement, we know Apple, not alone in terms of the tech giants being under pressure by the EU.

So this does resolve one issue but not necessarily in the clear when it comes to some regulatory pressure overseas.

So we of course, will see how all of this plays out.

I want to bring up Apple’s reaction to this news today because we’re not seeing a massive reaction to this.

We also had a call out from Bank of America raising their price target on the stock here earlier, they actually raised it.

So we are still down about 1% right now.

But maybe cushioning some of that downward decline is Apple, the price target raises a bit of a more bullish call here from Bank of America, raising the price target to 256 from 230 they’re citing some of that increased confidence on the multi year iphone upgrade cycle.

So once again, a number of headlines out here for Apple today.

So again, it looks like maybe the settlement is having more of an impact on the stock right now.

But despite that, despite those regulatory headwinds, and you had asked, uh, Scott Devitt of Web Bush about the regulatory headwinds facing a lot of these larger tech companies right now and many of the analysts continue to look past that at least for now saying that there’s always regulatory pressure.

It’s just another year.

And many of many of these times these large tech uh tech giants, either they’re fined or they were, they’re able to work out some deal and move beyond that.

It doesn’t at least seem to be changing the narrative surrounding the investment side of the story at least yet.

Right.

He said, oh, regulation.

So that’ll be my memory of how Wall Street is looking at regulation, at least for now.