News

Dec 18, 2023

Inside Apple's secret plan to kill the cash register

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By Mike Elgan

Contributing Columnist, Computerworld |

If you've ever been to a store, you know the drill: Browse the merchandise, pick something, carry it to the checkout counter, maybe wait in line, pay, then walk out with your purchases and a receipt.

Whether it's a clothing store, a grocery store or a coffee shop, you're likely to find a big counter with a cash register on it, and a person operating that cash register on the other side. You go to them; they don't come to you. Why?

An American saloon owner named James Ritty invented the cash register in 1879. Since then, all cash registers have shared the characteristics of bigness, heaviness and bulkiness -- and have required the old walk-up-to-the-counter behavior in order to buy things.

One notable exception is your local Apple Store. There are no cash registers. If you want to buy something, you flag down some kid wearing a brightly colored T-shirt and hand over your credit card. The kid scans the item's bar code with a specially outfitted iPhone or iPad, swipes your credit card and emails you the receipt. The transaction can happen anywhere in the store.

Apple, apparently, thinks the whole process for buying things in retail stores is dumb. The big counter you have to walk up to? The giant machine for registering the transaction? The paper receipt? Dumb. Dumb. Dumb.

And it has a point. Cash registers are obsolete and unnecessary.

So why would Apple's hotly anticipated iWallet system require a cash register?

It won't, if one analyst has it right. More on that below.

When people talk about the future of digital wallets -- electronic smartphone-based replacements for credit cards, debit cards and cash -- you're likely to hear the initials NFC in the same breath. NFC, for "near-field communication," is a set of technologies that makes it possible to pay for purchases using smartphones, among other things.

The idea is that all smartphones will contain special NFC chips that enable you to use your phone as a credit card. To make a transaction, you pass your phone over or near a special gadget that's hooked up to a cash register as an equivalent to swiping a credit card.

Many Android devices and other phones already have NFC chips. A few retail stores use NFC equipment. (As I write this, I'm sitting in a shop that's part of the Peet's Coffee & Tea chain. There's an NFC device near the register at the checkout counter, and there's a little sign specifying Google Wallet-based payments.)

Everybody's been waiting for the other 900-lb. handset gorilla -- Apple -- to ship iPhones with NFC chips in them to kick-start the contactless-payment revolution.

The point-of-sale industry (made up of companies that make and sell cash registers and the software and networked systems that support them) is in crisis. Apple's iPad is growing as an alternative to big, heavy cash registers and their hard-to-learn systems and interfaces.

Small retail businesses are opening their doors without ever buying a cash register. Instead, they're using iPads that use Square technology, or something similar, to handle the main functions of cash registers -- at a fraction of the cost.

Yet iPad-based point-of-sale systems don't involve digital wallets. The payment medium is still an old-and-busted credit card.