Shulou(Shulou.com)12/24 Report--

CTOnews.com, Dec. 17 (Xinhua)-- Technology giant Apple and payment giants Visa and MasterCard have recently been caught in an antitrust whirlpool, accused of conspiring to stifle competition in the payment card service market and driving up credit and debit card transaction fees for merchants.

The lawsuit alleges that Apple used its iPhone device to block the NFC chip, allowing only Apple Pay as the only mobile wallet platform to crowd out other competitors. Visa and MasterCard reached an agreement with Apple to transfer Apple Pay transactions to their respective payment networks and pay Apple a share of the transaction fee in return.

The plaintiffs argued that the agreement was essentially an "ongoing and huge bribe" offered by Visa and MasterCard to Apple, depriving Apple of its incentive to create an independent payment network, reducing market competition and causing merchants to pay higher credit and debit card processing fees.

"Apple has reached an agreement with Visa and MasterCard not to use iPhone to establish its own independent POS payment network, but to let Apple Pay transactions be conducted through Visa and MasterCard networks," the lawsuit said. According to reliable sources, Apple agreed to protect these existing networks from competition and restrict third party access to iPhone's specific hardware, the "security element", which allows third parties to develop mobile payment solutions that compete with existing networks. In exchange, Visa and MasterCard agreed to share part of the transaction costs generated by their respective payment networks with Apple. "

It is worth mentioning that CTOnews.com noted that it was reported earlier this week that Apple proposed opening up iPhone's Apple Pay NFC system to other companies under pressure from antitrust investigations in the European Union. However, it is still unclear whether this opening up will really happen and whether it will be extended to other markets.

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