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CurrentC tries and fails to explain why merchants are blocking Apple Pay

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Basically no one had heard of CurrentC last week. But as of Saturday, that all changed: everyone now knows it as the reason that big retail stores like Walmart and Best Buy aren't letting you use Apple Pay. CurrentC is those stores' own mobile payments app, and it was created specifically for them and many other retailers by the company MCX, which was formed just for that purpose. MCX is now under some criticism because its partners are blocking Apple's new payments system, even though they have the technology to support it. It's also in damage control mode after announcing earlier today that some of its users' email addresses had been stolen in a hack.

"This is not a technology decision."

In the wake of all of this, MCX decided to hold a call with members of the press to answer the many, many questions about what's going on. Unfortunately, its answers didn't explain much — and maybe only make things more confusing.

On the call, MCX CEO Dekkers Davidson suggested that there isn't a technological hurdle prohibiting retailers like Walmart from offering Apple Pay and Google Wallet alongside CurrentC, saying instead that it was a choice made specifically based on what each store believes customers want. "This is not a technology decision," Davidson says. "It's about consumer engagement." At the same time, Davidson also implies that there may still be a limitation that prevents both from being used simultaneously right now. "In the future that could be entirely possible," he says.

In fact, Davidson says that MCX expects — if not actually wants — to see some competition in the market. Without it, MCX doesn't think mobile payments will actually be able to take off. "We and our merchants believe it will require two or three strong players to build this system," he says. "We need to build the mobile commerce ecosystem to have two or three viable players. One won't simply build the market." It even sounds like retailers that plan to support CurrentC could eventually offer Apple Pay as well. When asked if there was any harm to letting Apple Pay be used alongside CurrentC, Davidson responded, "There is no harm from competition. It should happen."

That said, whether CurrentC partners are bound to any sort of exclusivity agreement remains unclear. The New York Times reported earlier today that partners could have to pay large fines for letting customers use other mobile payment solutions, like Apple Pay. On the call, however, Davidson denied that there were fines involved. Rather, he said that it's up to individual merchants to choose what mobile payments systems to support — and, presumably, to not support as well. "Merchants make their own choices about their commitment," Davidson says, noting that these merchants have "invested their time and money and effort" into building CurrentC.

"You should expect, and we have expected, attacks."

Even if it is up to merchants, it appears to be a somewhat collective decision to block out the competition in favor of their own option. And while Davidson paints the development of CurrentC as a way to help retailers and consumers connect, the broader idea seems to be letting retailers skirt the credit-card fees that they've long had to deal with on a good many of their transactions. That's a reasonable objective, but Davidson says that removing these fees is actually only a "tertiary item" on retailers' list of goals for CurrentC. Its primary interest, he says, is in making "it easy for consumers and merchants to engage directly with one another." That includes CurrentC's ability to work with loyalty cards, coupons, and other offers. MCX even says that it's signed deals with two credit card companies, which it declined to name, both of which come with familiar fee structures.

Davidson also says that MCX accepts responsibility for the email thefts this morning, though they apparently occurred on its email partner's machines. He declined to speculate on whether the hack related to the situation with Apple Pay, but he did say that MCX's attempts to disrupt the standard payments system may be making some people unhappy. "When you poke at a large ecosystem like that, you should expect, and we have expected, attacks," Davidson says. He also says that this hack does not make the company hesitant to use the cloud to store sensitive customer information, as it plans to do for users of CurrentC.

CurrentC is being tested in limited areas right now, and it plans to publicly launch early next year. It isn't making a good first impression, but with the huge names behind it, consumers may not have a choice but to give it another chance.